Impact assessment support study for the review of the Community guidelines on State aid for railway undertakings

In the wake of stagnant modal share of the European rail freight sector, this support study provides market information for the revision of the Guidelines on State aid for railway undertakings. It addresses four areas of interest: status of rail infrastructure; accessibility and costs pertaining to rolling stock; profitability and demand elasticity of rail freight ser- vices; and effectiveness of State support measures. A novel dataset of costs and revenues of rail freight across Europe, compiled using both publicly available data and input from extensive stakeholder consultation was built for that purpose. The findings are as follows. The inadequacy of intermodal terminals, congested rail networks, and costliness of private sidings all restrict the capacity of European rail infrastructure. Access to rolling stock is characterised by high costs and a lack of technical standardisation across Member States. We find that rail freight sectors in many countries are loss-making, with some segments being profitable. Efficient transshipment and transport of high freight volumes over long distances improves profitability of intermodal operations. The study shows that price sen- sitivity of rail freight services differs depending on the level of competition faced by road transport. The study also highlights to what extent higher thresholds for proportionate State aid and improved flexibility of schemes could be considered.