Climate change, an opportunity for high-speed train manufacturers.

Alstom is a leader in equipment and systems for the railway sector [1]. Creator of the world famous French high speed train TGV, the company recorded over €6.9 billion in sales in 2015 [2].

The transport sector consumes about 28% of the global energy consumption and its contribution to CO2 emissions has increased incrementally in the past decades to 23.4% of the global emissions [3][4]. In a context where the world population continues to grow and globalization accelerates, developing sustainable ways of transportation is one of the major challenges faced by humanity. As Alstom’s high speed trains offer a proven solution to the above challenge, the company could benefit from climate change, especially in underserved markets such as North America.


Share of final energy consumption by sector, 2013 [3]

Share of final energy consumption by sector, 2013


The Future of transportation – an opportunity for Alstom.

Rail transport represents 6.4% of the global transportation modal worldwide but less than 1% of CO2 emissions [3][4].


World transport modal share, 2013 [4]



Due to the electric propulsion technology, the rail is now seen as the greenest mode of transportation, in that aspect exhibiting a competitive advantage over road, navigation, and aviation. With climate change concerns on the rise and decreasing oil reserves, the geo-political environment is encouraging development of sustainable transportation projects independent of fossil energy. With such geo-political initiatives and an environmentally aware general public, local governments increasingly express interest in sustainable transportation development [5][6]. In the light of climate change, Alstom can capitalize on the forthcoming changes facing the transportation industry.

An opportunity as a market leader.

Alstom introduced its first version of the TGV in 1981 [7]. Compared with the Japanese Shinkansen, the TGV can operate on conventional tracks, providing significant cost savings to nations that wish to update their railway system rather than develop a brand new network [7]. Additionally, the last version of the TVG holds the speed record as the fastest wheeled train (358 mph) and can be operated at speeds of up 223 mph in total safety [7][8]. While the top speed (without passengers) of the TGV is 17 mph slower than its Japanese competitor, the TGV can operate safely (with passengers) 23 mph faster. On the energy efficiency side, the estimated annual CO2 emissions for the TGV is 42% lower than its Japanese counterpart [8]. Alstom’s product offers the most economic high speed train technology in terms of necessary capital investment and energy consumption and is therefore well positioned to take full advantage of the global swift towards rail transportation due to climate change.


Operating speed, construction cost and compatibility

(with conventional network characteristics of the four high-speed train models) [12]

Operating speed, construction cost and compatibility (with the conventional network) characteristics of the four high-speed train models



… then, why is my train only running at 100 mph?

Since its invention in the 1960’s, high speed trains have been praised for having many benefits, though the deployment of this revolutionary technology has been limited to a few countries in Europe and Asia that all happened to be producers of such technologies. In fact, exporting high speed trains proved to be very challenging due to the lack of long-term commitment of governments. Indeed, high speed trains generally requires not only high initial investment but also long term planning from governments. This has proved to be very difficult in western democracies like the United States where government involvement in public service is traditionally sparse and further complicated by the fact that infrastructure planning may change each election cycle, and federal initiatives may need approval from local legislators at state, county, and township levels [10]. Despite the advantages of the high speed trains and its proven necessity on both coasts of the United States [5], the political disagreements have prevented its implementation, but this is changing rapidly. Although no high speed trains are currently operating, the current US administration, along with both presidential candidates [9], committed billions of dollars to building high speed trains to link major cities [10].


A future full of success

With the American public awareness of global warming at an all-time high, Alstom offers an already proven solution to decrease the country ecological footprint. Recent success seems to demonstrate that the company strategy is working as Alstom signed in 2016 a $2.4 Billion contract with Amtrak to bring high speed trains on the east coast of the United States [11]. This is a very competitive market and the current technology does not allow the trains to be carbon neutral. Alstom should seek to maintain its leadership in sustainability and continue to invest until it manages to produce carbon neutral high speed trains [6].

(757 words, excluding references)



[1], “World market share of leading global rail equipment manufacturers in 2001”,, accessed November 2016.

[2] Alstom,, accessed in November 2016.

[3] Jean-Pierre Loubinoux and Fatih Birol, “Railway Handbook 2016”, Page 20,, accessed November 2016.

[4] Jean-Pierre Loubinoux and Fatih Birol, “Railway Handbook 2016”, Page 19,, accessed November 2016.

[5] Yoav Hagler and Petra Todorovich, “America 2050, where high-speed rail works best”, Page 6,, accessed in November 2016.

[6] Challenges, “Alstom va développer un train “zéro émission” en Allemagne,, accessed in November 2016.

[7] Moshe Givoni, “Development and Impact of the Modern high-speed Train: A Review”, Page 596,, accessed in November 2016.

[8] Kevin Scott, “How Big Are the Environmental Benefits of High-Speed Rail? A Cost-Benefit Analysis of
High-Speed Rail replacing automobile travel in the Georgetown-San Antonio corridor”, Page 46,, accessed in November 2016.

[9] Haley Sweetland Edwards, “Trump agrees with Democrats on high-speed trains”,, accessed in November 2016.

[10] N.B., “Obama and high-speed rail, late arrival”,, accessed in November 2016.

[11] Amtrak, “Amtrak Invests $2.4 Billion for Next-Gen High-Speed Trainsets and Infrastructure Upgrades,, accessed in November 2016.

[12] Moshe Givoni, “Development and Impact of the Modern high-speed Train: A Review”, Page 598,, accessed in November 2016.



Allianz: Insuring Both Sustainability and Resilience


Wildfires – PG&E’s latest $90 million problem

Student comments on Climate change, an opportunity for high-speed train manufacturers.

  1. The author of this blog post hails Amtrak’s partnership with Alstom (which will replace Amtrak’s current Acela trains with Avelia Liberty trains for the Northeast Corridor) as a step in the right direction towards improving the country’s sustainable transportation. However, while a step in the right direction, I disagree with the author about the extent of the impact this will have, as the new trains will run at the same speeds as the older Acela train due to the actual track speed limits [1]. Until the country actually improves the rail infrastructure, improvements in high-speed trains will have limited impact in shifting consumer behavior towards environmentally-friendly rail travel versus environmentally-damaging flying. The U.S. government needs to first and foremost turn its resources towards improving the physical rail infrastructure, to promote a future of sustainable transportation in our country.

    [1] “Alstom to provide Amtrak with its new generation of high-speed train,” Alstom, August 26, 2016,, accessed November 2016.

    1. I agree with PThatai. Rail infrastructure (and its general poor state of readiness) remains the limiting factor for expanding passenger rail service in the United States. Additionally, existing U.S. rail infrastructure located beyond the Atlantic northeast is committed to commercial freight use.

      I am interested to know how CO2 emissions relative to rail PKM (for passengers) and TKM (for freight) are calculated. I would imagine that rail emissions are variable depending on the local electricity source. So, a rail line in Japan powered by a nuclear plant might “emit” no CO2, while a very similar line in Connecticut powered by a coal plan might emit quite a bit. The accounting challenges are real.

      I enjoyed this article and am curious to know how other rail equipment manufacturers (like Siemens and Bombardier) are competing or not competing with Alstom in this sector.

  2. Good to know that rail transportation can actually contribute to climate change. When I was in China, railway is always my preferred transportation method when I commuted between Beijing and Shanghai. Not because sustainability issue but because the high-speed train offered more leg space and was also pretty fast. However in US I realize that Amtrak does not meet my expectation mainly because its speed. It takes more than three hours to travel between New York City and Boston. In contrast, traveling between Beijing and Nanjing takes almost the same time but the distance doubles (800+ km). Therefore, I think it would be great if Amtrak could partner with high-speed train provider and offer more efficient transportation service. During the same time they could also make more contribution to mitigating climate change.

  3. As I am writing this post, I am currently riding on the Acela (“fast speed” rail) from NYC to Boston. Unfortunately, the time I shave off this route versus the NorthEast Regional Rail is only about 40 minutes of a 4.5 hour journey. I agree with PThatai’s point on the need for better rail infrastructure. The reason why fast speed trains cannot help increase speeds is the sharp turns found in current rail infrastructure. Because the existing rail network was driven at slower speeds, trains were able to travel on sharper curves and route around existing private property. Therefore, the upgrade to faster rail must coincide with a private and public effort to uproot existing properties for a straighter path. The other way this could potentially be done is through Elon Musk’s idea of the hyperloop. Such a vehicle would not require as high of a maintenance capex (in theory) found in traditional rail. Powered by electricity in a close to vacuum compact tunnel, the hyperloop could be more space saving and energy efficient, leading to a greener future.

  4. Great article. As a user of America’s rail services, high speed rail is appealing not only because it is green, but also because it would tremendously improve the travel experience. You also mention increasing globalization and increased travel across the world also makes high speed rail a good fit for those looking to combat climate change due to its low carbon emissions. However, naturally, globalization often means traveling across oceans, seas, and other bodies of water. Given this, while this may be a good way to be more green within countries and regions, as you mention, as people increasingly want to travel abroad for business or pleasure, this mode of transportation won’t meet the objectives, as I would imagine any benefit you’d get from the limited emissions in high speed rail would be offset by an increase in air travelers. In addition, this would only work in the U.S. if the existing rail infrastructure was improved. To fix the rail infrastructure, it is likely that tons of concrete and other materials would be needed, which would contribute heavily to climate change.

  5. Blaine raises some very important point in his comment above. Some electric trains just shift the carbon impact responsibility upstream to the power plants that produce the electricity. While I agree that even conventional, non-electric locomotives have an incredibly low impact due to the massive load a single locomotive can transport relative to a diesel truck transporting cross country, electric high speed trains require large amounts of electricity to maintain magnetic levitation. These friction reductions due to levitation allow for incredible gains in speed but require substantial electrical input to overcome drag at high speed. While I am excited about the potential that high speed electric trains provide, I feel that the impact will not be significant until substantial investments are made in rail infrastructure as well as a carbon neutral power generation on a large scale, such as nuclear, is widely adopted.

Leave a comment