Electrification of Indian railways has been one of the most important transformational initiatives taken by ministry of railways. While the general financial and environmental benefits of electrification are well known, it is the actual impact of electrification on railways budget which can stun any sane mind. To understand this better let us take example of South central Railway(SCR).SCR uses energy mix of both electric traction and diesel to run its trains. Due to large electrification and deliberate choice to prioritize the electric traction over diesel, SCR ran 82 percent NTKMS (Net ton KMS) on electric traction and around 18 percent on diesel traction. For those new to railway parlance, net ton kms(NTKMS) is metric to understand the weight moved by transporter over a particular distance excluding the weight of the wagons i.e. it includes only the actual freight weight which has been transported and is considered an important metric from the perspective of revenues and growth.
Thus, in FY22,SCR ran substantial trains on electric traction and fewer on diesel. Now let us come on its financial impact on the budget and it can be mind boggling. For 18 percent diesel NTKMS , SCR had to spend Rs 2000 crores whereas for 82 percent electric NTKMs, SCR had to spend Rs 1400 crores. This means that electric NTKMS on the railways were 4.5 times of diesel NTKMS and electric bill was only 70 percent of the diesel bill. Now let us extrapolate the above figures to dig deep into two extreme scenarios, First is ‘100 percent diesel’ in case the railway had not embarked on electrification. In this scenario, the diesel bill of SCR would have been Rupees 11,111 crores approximately((2000*100)/18).Let me just make the reader aware, that total SCR budget for FY22 was Rs 13000 crores. Thus, if Indian railways had taken the first choice of having 100 percent dependence on diesel then probably the railway would be on the brink on bankruptcy.
Now come to second scenario i.e. ‘100 percent electric scenario’. In this case the total electric bill of SCR would have been Rs 1707 crores (100*1400/82).This would probably means railways returning to a green bottom-line and a surplus at the end of the day. Let us just find the difference between the two scenarios to understand how big the gap is. If we minus full electrification scenario from full diesel scenario, we get a figure of Rs 9404 crores per year for south central railway alone. It means full electrification is likely to save Rs 9404 crore for south central railway and this figure is likely to be 144,676 crores ((2,00,000*9404)/13000) every year for the Indian railways as a whole. Isn’t it astounding? Railway electrification projects will be generating a saving of Rupees 1,44,676 crores every year once 100 percent electrification is complete.
This is one of the best capital investment in infrastructure projects where returns are both visible and substantial. Electrification in railways has matured faster than electrification of automobiles and this is going to give railways an edge in inflationary regime in which we may have already entered. The electrification in railways is simpler and safe as only train moves but the overhead electric source remains constant whereas in automobiles storing the energy is major constraint in deciding the mileage. And that is the reason why electric revolution in Indian railways has been subtle, silent and yet very effective.
Excellent analysis Keshav but do calculate the capital cost of electrification viz a viz diesel locos. You should not discount maintenance cost too on electrical assets like OHE etc. Then a more realistic picture would emerge.
Electrification has its own issues. Electrifying train routes largely transfer the location of the pollution till the time we move to clean energy. I agree with Zaigham that we must calculate all costs to compare electric with diesel. Presently we can’t be conclusive about cost saving. In addition looking at hundreds of idling diesel locos appear criminal.
IR will have substantial savings on fuel costs once 100% electrification is done