High Speed regulation

Feras Alshaker
Feras Alshaker
Head of Planning & Enhancements
Body
Components

We regulate HS1 very differently than Network Rail because it has a 30-year concession to operate the high speed railway between London St Pancras and the Channel Tunnel. This includes looking after the stations on the route - London St Pancras, Stratford International, Ebbsfleet and Ashford.

The concession agreement HS1 Ltd has with the Secretary of State for Transport insists that it must manage the network as if it were looking after it for the next 40 years, and even specifies how many trains must be able to travel at any time between certain points, and how fast trains must be able to travel between London and the Channel Tunnel.

How we regulate

To ensure that HS1 Ltd does this efficiently, every five years the Office of Rail and Road carries out a review to determine, for the coming five years (known as a Control Period):

  • what HS1 Ltd must deliver for its customers;
  • how much it can charge its customers to access its network; and
  • how we as the regulator will monitor them.

Find out more about ORR’s approach to the periodic review for 2020-2025.

What’s different about HS1?

In railway terms HS1 is new and its infrastructure performs very well compared to the older (in some cases 150 years older) network. HS1 Ltd is not funded through a Regulated Asset Base (that is, by assessing the current value of the assets), nor by a direct grant from the government like Network Rail. Instead, repairs and maintenance are funded from an Escrow account jointly held by HS1 Ltd and the government.

Operators pay into this account as they use the network, which means that future operators won’t be saddled with the cost of replacing parts of the network while current users get the benefit. HS1 Ltd has to estimate what it thinks those costs are and we assess this as part of our determination.

We want to make sure that HS1 Ltd has incentives to reduce the cost of using its network. This should mean a better deal for its customers (train operators), and their customers (passengers or businesses moving freight by rail).

We are working with HS1 Ltd and its customers to understand how the money it gets from train operators is managed, and how spending decisions are made - this will help us to make sure that current and future users benefit from investment in, and good management of, this unique part of the UK railway network.

While the HS1 network performs very well now, and things which are common on the classic network such as disruptive engineering works are rare, we know that as it ages this may not always be the case. Our review is looking to tackle some of the difficult questions now and set HS1 up for success in the future.