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Uncertain times in Estonia

17 Sep 2008

ESTONIA: National rail operator Eestie Raudtee confirmed last month that it planned to split infrastructure management and freight train operations into separate companies with effect from January 1 2009. New subsidiaries EVR Infra and EVR Cargo are to be established, with EVR remaining as a holding company to deal with corporate issues. Such a split had been mooted when the state bought back the network in January 2007.

The split will once again focus attention on the contentious issue of track access charges. The Baltic Rail Services consortium argued at the time of the buy-back that the government had effectively reduced the value of its concession by capping access charges, and pointed out that they were allowed to rise again after the sale, when the government revised the calculation method.

Independent passenger operator GoRail blamed high access charges for its decision to withdraw the Tallin – St Petersburg service from September 1, although EVR rejected the accusation. Nevertheless, we note that the state railway repor­ted a profit of 42 million kroons in the first half of 2008 although freight traffic collapsed to 13·4 million tonnes from 22·3 million for the same period in 2007.

As well as acquiring the former EVR Ekspress business in 2006, Estonian transport company Go Group now works with Edelaraudtee, which runs the lines from Tallinn to Viljandi and Pärnu. And here too the private operator is concerned about state intervention. The government is planning to call tenders for up to 36 electric and diesel trainsets at a cost of 2·7bn kroons, and launch a public procurement exercise for an operating concession. The tender is to be managed by Elektriraudtee, the state-owned operator of Tallinn suburban services, but Edelaraudtee has reportedly rejected suggestions that the two passenger operators should make a joint bid for the concession.