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Melbourne and Gold Coast tram operator sets up in Canberra to bid for light rail project

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With the release on Friday of the long-awaited full business case for Canberra's $800 million tram line, the operators of Melbourne's trams are setting up shop to bid for the project.

Keolis Downer has put together a consortium, with Bombardier as the tram supplier, to bid for the chance to build, own and operate the 12-kilometre line from Gungahlin over 20 years.

Keolis operates the new Gold Coast tram, a similar length through Surfers Paradise, and has a 15-year franchise to operate Melbourne's network, which it says is the world's biggest.

Project director Kieran Street is looking for office space and awaiting Friday's release of the expression of interest documents for the bid.

Mr Street said the project was attractive for the wide median strip down Northbourne Avenue, the public-private-partnership model, the redevelopment of Northbourne, and because of the number of years the government had spent investigating the project.

Gungahlin was a sensible place to start given the speed at which Gungahlin was growing and the plans for Northbourne redevelopment.


Keolis corporate affairs director Peter Colacino described light rail as "an enabler", allowing Northbourne to be reshaped and allowing denser living. The keys to successful projects were connecting trams with buses, walking and other "active transport", and linking with urban renewal, he said. It was important to connect the tram line well with Dickson and allow people to move easily through the corridor.

"So the fact that there's actually the idea to do something different on Northbourne Avenue and to create a new gateway to the city is really important to us and really attractive," he said. 

Much of the debate about light rail has centred on whether the tram will attract sufficient passengers to make it viable. But this is a concern more for the government than for the consortiums bidding to operate the line, because the operator won't wear the risk of low numbers of passengers. The fare revenue will go to the government, which will pay the operators a set fee to run the system, albeit with an incentive payment for increasing patronage.

But Mr Street said Keolis was in the business of building trams that people wanted to use.

"We don't want to deliver a system that's carrying around fresh air," he said. "The frank reality is you want to size the network to the population, to the number of people who want to travel, so we'll do a lot of work looking at the numbers that the state put forward to us and we'll try and develop the best value for money outcome.

"But we'll also try to provide legacy value so if you need to upgrade it or extend it or build it bigger into the future, that can be accommodated as well."

The pair rejected the suggestion that the line was limited in its appeal, travelling only to Gungahlin. Mr Colacino said it was easier for tourists to negotiate than buses and would improve access to the national institutions by tying into the city and the lake.

"If you're a tourist and you come to Canberra, you look at the bus network and you think oh my god, that's unwieldy, where am I going to go? Whereas if you walk to a light rail stop you can see where it goes, and it's just much clearer for people. That's been the experience on the Gold Coast as well."

Mr Street said people would see the benefits once the line was in place, resulting in more demand for Northbourne hotel rooms, and "incentivising" hop-on, hop-off short trips.

The company was also looking at ways to accommodate bikes, he said, although he rejected the idea of bus-style racks on the front of trams. On the Gold Coast, stations had bike lock ups and trams allowed surf boards on board.

Mr Street said it was clear from other networks that "the overall net benefit to communities, to growth to stimulating local economies, is actually quite significant, quite compelling".

Keolis and Bombardier were part of a consortium shortlisted to build the Sydney line through George Street and the eastern suburbs, but were forced to withdraw when British-based construction partner Balfour Beatty pulled out.

Mr Street said they were not going to run the risk of a partner pulling out of Australia again and for the Canberra bid they were using Australian company Downer Construction for designing and building. Keolis would provide operations and maintenance, Bombardier Transportation the rolling stock, and the Plenary Group the financial expertise.