# Rail traction: Unit economics

Why wiring a railway pays only where trains run often

Source page: https://www.materialinsights.org/energy/e_rail_traction/economics/

What this tab covers What it costs to move a unit of energy this way: capital and operating costs, tariffs, utilisation and how it compares with the alternatives.

Electric trains are cheaper to run than diesel but need expensive fixed wires; electrification pays where traffic is dense. Diesel-electric operators cut fuel mainly through engine upgrades and, newly, batteries.

#### Key costs

| Measure | Value | Note |
|---|---|---|
| **UK electrification cost, simpler projects** | 0.75-1.0 million GBP per single-track km (2019)^[14](https://www.riagb.org.uk/RIA/RIA/Newsroom/Publications Folder/Electrification_Cost_Challenge_Report.aspx) | troubled recent projects GBP 2-2.5 million |
| **Running cost, electric against diesel trains** | over 35% cheaper%^[14](https://www.riagb.org.uk/RIA/RIA/Newsroom/Publications Folder/Electrification_Cost_Challenge_Report.aspx) | RIA citing a 2009 UK Department for Transport estimate |
| **Battery locomotive fuel saving (pilot)** | about 11%% of train fuel use^[11](https://www.freightwaves.com/news/wabtec-battery-electric-locomotive-reduces-fuel-use-by-11) | 2.4 MWh FLXdrive in a BNSF consist, California, 3 months in 2021; about 6,200 gallons saved; second generation above 6 MWh could save up to 30% |
| **Engine upgrade fuel saving** | up to 7%% additional fuel saving^[10](https://www.wabteccorp.com/trains-of-thought/advantage-wabtec-relentless-innovation-drives-evolution-series-engines-into-the-future) | Wabtec EVO Advantage upgrade, 2025 |
| **Global new rolling stock market** | 64.6 billion EUR (2024)^[6](https://www.sci.de/shop/productfiles/p18/WorldwideRollingStockManufacturers2025readingsample.pdf) | top ten makers about 70% |
| **Saving from a steady UK electrification programme** | about 30% (range 16-37%)% of infrastructure cost^[15](https://www.riagb.org.uk/common/Uploaded files/Publications/Electrification Cost Challenge 2.0.pdf) | RIA estimate, 2026 |
| **US on-highway diesel price** | 5.19 USD per gallon (2026 average, EIA October 2026 outlook)^[16](https://www.eia.gov/outlooks/steo/archives/oct26.pdf) | retail including taxes; used in the worked example |

#### Where the money goes

| Item | Share or amount |
|---|---|
| **Route clearance in UK electrification (raising bridges, lowering track)** | 30-40% of the cost of some schemes^[14](https://www.riagb.org.uk/RIA/RIA/Newsroom/Publications Folder/Electrification_Cost_Challenge_Report.aspx) |
| **Rolling stock in Alstom sales** | about 52% of EUR 19.2 billion (calculated: 10,045 of 19,171 million)^[8](https://www.alstom.com/press-releases-news/2026/5/alstoms-fiscal-year-202526-results) |
| **Energy losses per 100 units at the wheel, modern electric train** | transformer 7.5, converter 4.7, motor and gearbox 12.2, auxiliaries 9.9, parked 8.4^[1](https://library.e.abb.com/public/896cf517fcce4406b7a4facb6d6b7d0c/Traction_systems_high%20power_RevB_180916_web.pdf) |

Worked example: the FLXdrive pilot saved about 6,200 gallons of diesel in three months. At EIA's 2026 average US on-highway diesel price of USD 5.19 per gallon that is about USD 32,000 (calculated), or roughly USD 129,000 a year if repeated (calculated); railways buy fuel in bulk without road taxes, so their saving per gallon is lower. Battery locomotive prices are not published in the checked sources, so payback cannot be computed; savings are largest on hilly routes where braking recharges the battery. BHP is commissioning two 7 MWh FLXdrive units on its Pilbara iron ore lines in Western Australia.

#### Sources

1. [Traction systems for high-power applications (brochure, Rev B) (company data)](https://library.e.abb.com/public/896cf517fcce4406b7a4facb6d6b7d0c/Traction_systems_high%20power_RevB_180916_web.pdf) ABB, 2018
2. [Worldwide Rolling Stock Manufacturers 2025 (reading sample)](https://www.sci.de/shop/productfiles/p18/WorldwideRollingStockManufacturers2025readingsample.pdf) SCI Verkehr, 2025
3. [Alstom's fiscal year 2025/26 results](https://www.alstom.com/press-releases-news/2026/5/alstoms-fiscal-year-202526-results) Alstom, 2026
4. [Advantage Wabtec: relentless innovation drives Evolution Series engines into the future](https://www.wabteccorp.com/trains-of-thought/advantage-wabtec-relentless-innovation-drives-evolution-series-engines-into-the-future) Wabtec, 2025
5. [Wabtec: battery-electric locomotive reduces fuel use by 11%](https://www.freightwaves.com/news/wabtec-battery-electric-locomotive-reduces-fuel-use-by-11) FreightWaves, 2021
6. [Electrification Cost Challenge](https://www.riagb.org.uk/RIA/RIA/Newsroom/Publications Folder/Electrification_Cost_Challenge_Report.aspx) Railway Industry Association (RIA), 2019
7. [Electrification Cost Challenge 2.0](https://www.riagb.org.uk/common/Uploaded files/Publications/Electrification Cost Challenge 2.0.pdf) Railway Industry Association (RIA), 2026
8. [Short-Term Energy Outlook, October 2026, Table 2 (US energy prices)](https://www.eia.gov/outlooks/steo/archives/oct26.pdf) US Energy Information Administration, 2026

## Other sections

- [Summary](https://www.materialinsights.org/energy/e_rail_traction/index.md)
- [Overview](https://www.materialinsights.org/energy/e_rail_traction/overview/index.md)
- [Correlation](https://www.materialinsights.org/energy/e_rail_traction/correlation/index.md)
- [Science and limits](https://www.materialinsights.org/energy/e_rail_traction/science/index.md)
- [Value chain](https://www.materialinsights.org/energy/e_rail_traction/valuechain/index.md)
- [Engineering methods](https://www.materialinsights.org/energy/e_rail_traction/methods/index.md)
- [Equipment and suppliers](https://www.materialinsights.org/energy/e_rail_traction/equipment/index.md)
- [Relationships](https://www.materialinsights.org/energy/e_rail_traction/links/index.md)