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Focussing on funding management

Interview with Thomas Kaspar on the status and new developments

Thomas Kaspar Innovation, Strategic Programs and Steering

Since the beginning of 2014, L.CBA has conducted a systematic funding management for DB Cargo Group, in order to accompany project financing in the production / asset and market sectors for an innovative European rail freight transport.

Thomas Kaspar, single point of contact for funding management within DB Cargo, offers us an overview of the current status of ongoing funding projects and of future funding opportunities.

Which funding contributions does DB Cargo receive? 
DB Cargo has successfully placed funding projects in various European and national funding programs over the last 5 years.

Most of the funding contribution comes from EU funding programs, in particular the Connecting Europe Facility (CEF), with approximately 75% and Shift2Rail (S2R) with approximately 10%.

A total number of 15 projects have been approved within CEF since 2014 (for instance, ERTMS on-board equipment, LEADER, HELMS, LL retrofit of rail freight wagons, introduction of EPS in 8 countries, transport concepts for automotive or steel in Spain and the UK). At S2R, the strategic importance for DB Cargo is essential in shaping railway transport research and development, in particular in the field of automation.

Since July 2018 the DB Cargo funding portfolio covers also the BMVI “Modernitätsfonds” – a program to fund digitalization projects. Here, funding is provided for a joint project with RWTH Aachen and the startup company Inspirient from Berlin to intelligent data-based identification of damage patterns in rail vehicles.

Which tasks are covered by funding management? 
The most important task is to identify eligible projects within DB Cargo and to accompany them from submission until approval. This process is specific to each project, the effort being considerable and, generally, takes around six to twelve months. 
Under certain circumstances, project partnerships and consortiums have to be created initially. 
Later, the project approach or work packages and the division of tasks among project partners have to be clarified and a budget plan has to be prepared in the course of the project. In case of a positive assessment, grant agreements will be prepared in coordination with the funding institution.

After funding approval, the second essential task of funding management starts with the beginning of the project. This includes, first of all, the support of the project manager in controlling of the milestones and reporting, in particular in case of problems or delays. 

There are generally very high demands from the funding institutions, which have to be fulfilled on time. A further important task is the complex preparation of funding payment claims in cooperation with financial auditors. The aim is to minimize the risk of reduction or rejection of eligible costs by funding institutions.

Which topics are in the focus in 2019?
In particular, the so-called Energy and Climate Fund (EKF) and Master Plan Rail Freight Transportation will pro-vide new and significant funding opportunities for the railway sector. In addition, BMVI has plans for a new and independent railway research institutionalization. 

Thus, in addition to the already existing EU funding programs, there will be also opportunities for additional funding for DB Cargo and fort additional financial contribution to our projects.

Under the EU-Funding Program Connecting Europe Facility – Transport the European Commission has approved the following 9 proposals submitted by DB Cargo.

40-CONTECH (Action 2014-DE-TA-0296-W)

This Action refers to the innovative 'just-in-time' (JIT) intermodal logistics concept, by which the beneficiary, DB Cargo aims to shift traffic from road to rail on several Core Network Corridors and reduces 11,200 tonnes of CO2 emissions per year. The Action will lead to a high-quality rail JIT concept between Germany and the UK.
The Action's main focus is the design of and investment in a new 40-foot open top curtain side container to improve the loading and unloading process and increase the utilisation of the maximum allowed weight for each wagon. The Action will invest in 300 innovative 40-foot containers and 184 wagons that are compliant with the Eurotunnel safety specifications. It will also include the investment in ‘track and trace’ technology with GPS telematics for near real time monitoring of freight flows.

MEDAS 3.0 (Action 2014-DE-TA-0326-W)

The Action involved the greening of the automotive supply chain with trusted collaborative networks by bundling cargo and operating a sustainable ‘just in time' rail shuttle service on part of the Core Network Corridors. 
The applicant DB Schenker Rail Automotive (DBSRA) acted as a Lead Logistic Provider (LLP), offered a door-to door service and managed the freight bundling service between several automotive clients.
DBSRA invested in bundling the cargo of automotive clients, while maintaining required just in time delivery, and at the end of the project ran 13-15 freight transport round trips by train per week. DBSRA also invested in vendor inventory ‘track & trace' IT tools and in single wagon equipment with a dual gauge change functionality. 
The Action aimed to increase the environmental sustainability of the automotive supply chain and to reduce greenhouse gas emissions by 26,000 tonnes of CO2 per year.

LL RETROFIT 16000 (Action 2014-DE-TA-0389-W)

The Action was part of the global project of DB Cargo to retrofit freight wagons with low-noise low-friction brake blocks that are running along densely populated TEN-T Core Network Corridors in Germany.
The Action covered the retrofit of 16,000 freight wagons with ‘silent' LL brake blocks, which have been approved by the European Railway Agency. The Action foresaw the retrofitting of mainly wagons with four axles with either 16 or 32 LL brake block units per wagon.
This Action has been completed fully and thus contributed to advancing the global project and to reducing the traffic noise caused by rail freight operations in Germany.

EPS-TAF (Action 2014-DE-TM-0397-W)

DB Cargo will develop and roll out a digital communication infrastructure compliant with the EU's TAF TSI Regulation within eight EU Member States (Austria, Denmark, France, Germany, Hungary, Italy, Poland and the Netherlands) to support interoperable European cross-border rail freight transport services.
The system is called European Production fulfillment System (EPS) and aims at connecting all the rail stakeholders of these eight countries, enabling the digital planning, scheduling, monitoring and execution of international rail freight transport services.
Activities within the Action include studies, testing, training, roll-out and dissemination activities for the EPS. Completion of the Action could serve to support seamless and interoperable cross-border rail freight transport and improved rail freight logistics services on the TEN-T network.

RIO (Action 2014-DE-TM-0414-S)

The RIO Action (Rail Infrastructure Optimisation) was a study with an integrated pilot project, where an interface system aiming at improving energy efficiency on rail freight operations was tested. 
RIO combined a data infrastructure system and panel PC to advise the vehicle driver about how to carry out energy-efficient operations. The data system gathered rail infrastructure details, such as topography and freight train path utilisation planning continuously. This data was transmitted via the RIO interface to the locomotive vehicle in real time to optimise rail freight operations. 
The system was used for passenger transport but not yet on freight transport. Large investments were needed to adapt the current RIO passenger system to the rail freight sector. 
RIO was tested on four main corridors during this Action, and led to a reduction of CO2 and energy use by between 4% and 13%.

HYBRID-INFRA-RAIL (Action 2016-DE-TM-0002-S)

The Action's main objective is to conduct a deployment study with two hybrid units and to improve the rail infrastructure to be able to use the hybrid systems at a large scale. Its specific objective is to adapt the existing hybrid technologies to the needs of the rail sector and to deploy hybrid infrastructure systems, encompassing electrical battery power and diesel for rail infrastructure.
The Action covers real life trials in operational conditions, preparation of design for the necessary battery charging distribution network along the TEN-T network to enable and support the market uptake as well as a business plan containing the market uptake strategy. Two existing diesel locomotives type BR294 will be equipped with electro mechanical hybrid traction technologies. For these prototypes the energy efficiency and consumption will be measured and compared during the real life trials for the situation with and without the hybrid components.
Upon completion of the Action, the hybrid infrastructure system will be ready for commercialisation and the business plan will contain a market uptake and exploitation strategy.

LL RETROFIT EU (Action 2016-DE-TA-0003-W)

The Action aims to reduce rail freight noise by retrofitting a minimum of 27,000 rail freight wagons (owned by DB Cargo and its affiliated entities) that are running along the nine Core Network Corridors with silent brake blocks. 
It is part of a global project of DB Cargo to replace the cast iron brake blocks of the existing wagons by "silent" LL brake blocks made of composite materials which enable that the wheel surface remains smooth. 
The Action will contribute to a noise reduction of up to ten decibels and to increased intermodal competitiveness of the rail transport compared to road transport.

ERTMS SCAN-MED (Action 2016-DE-TM-0128-W)

The Action covers the retrofit of 17 existing locomotives type BR 185.2 with ERTMS (European Rail Traffic Management System) Level 2, Baseline 3 operated primarily, but not only, on the Scandinavian-Mediterranean Core Network Corridor in Germany, Denmark and Sweden.
It is a part of a global project aiming at enabling interoperability of the applicant's rolling stock fleet by means of ETCS deployment. 
The Action includes prototyping of one vehicle - including testing, subsystem verification and authorisation - followed by the serial retrofit of the 16 locomotives.
Successful implementation of the Action will contribute to interoperability of a part of the German railway fleet.

DB TAF-TSI (Action 2017-DE-TM-0009-W)

The Action addresses the implementation of the requirements on rail interoperability for freight by DB Cargo, in adherence to EU rules on the technical specification for interoperability relating to the telematics applications for freight subsystem of the rail system in the European Union (the so-called TAF-TSI Regulation).
In particular, to support interoperable European cross border rail freight transport services and to enhance the competitiveness of the rail freight transport sector, DB Cargo will roll-out a digital communication infrastructure across Europe (operations in 16 EU countries along the nine corridors of the TEN-T Core Network). This will be done in cooperation with the existing international intermediates, such as RailData and RailNetEurope. While DB Cargo is already using some standard digital communication messages, it aims atbecoming fully compliant with the TAF-TSI Regulation. 
As a result, DB Cargo will standardize communication messages for the electronic exchange of data in affected applications, as stipulated in the data catalogue of the said Regulation.