Nevada State Rail Plan

The 2021 Nevada State Rail Plan as a model for other States and Provinces

The Nevada Department of Transportation contracted OnTrackNorthAmerica and its sister, for-profit advisory firm Strategic Rail Finance, to create the 2021 Nevada State Rail Plan. Applying our Collaborative Industrial Optimization approach, we established a breakthrough rail-enabled economic development strategy for the state.

Like many states, Nevada developed during the westward expansion of railroads in the 19^th century. While this history is often forgotten in our modern discourse, reestablishing the railroad's value to an efficient, sustainable society is essential to Nevada and the entire continent. While North America’s dearth of passenger trains is often lamented, people are surprised to learn that the U.S. freight rail system is a global leader. However, North America shares a dynamic with the rest of the world, wherein rail freight lags far behind truck transportation as a consequence of the massive public investment in road and highway infrastructure of the 20^th century.

At its peak, the Nevada rail system stretched 2,422 miles. Since then, it has receded to 1,193 miles despite the expansion of the state’s population and industrial activity. The 2021 Nevada State Rail Plan (NVSRP) has been created to support a balanced transportation system that maximizes sustainability, productivity, and profitability. The plan established eight regions and teams and comprehensively identified passenger and freight rail infrastructure and operations. This includes all active and proposed mines and industries, businesses and their proximity to rail, and all truckload shippers. The plan cataloged over 12MM individual truck and rail shipments, classified by commodity, traffic flows, empty and full truck dynamics, volume changes, and destination and origin. Further analysis of the economic and environmental impacts, including congestion, air quality, population demographics, and industrial employment data, informed the calculated benefits of modal conversion from truck to rail.

Key Data Findings:

• 77% of freight tonnage is carried by trucks
• 83% of rail volume is through traffic, primarily serving commerce outside the state
• Only one warehouse of 137 in Nevada is using rail
• 70% of all trucks in the state are moving to or from California on that trip
• Only 4% of ground freight moving by rail is going to or from a Nevada business
• Less than .25% of land freight is moving by rail from one Nevada business to another
• Transportation and warehousing is the second-largest employment sector and growing
• Transportation is currently responsible for 28% of U.S. Greenhouse gas emissions
• Modal conversion from truck to rail would reduce emissions by 5%-25%

Working and investing comprehensively to transform a system is more productive and efficient than narrowly focusing on an individual project basis. The 17 recommendations pinpointed in the NVSRP comprise a systematic solution that optimizes the use of rail for Nevada’s economic expansion and environmental improvement.

The NVSRP tackles the chronic challenges to state rail plan implementation:

1. Regional marketplace dynamics that throttle rail expansion
2. Limited public funding for rail infrastructure
3. Follow-up organizational structure and commitment

The NVSRP illuminated an investment opportunity of $740M to connect rail infrastructure to 53 identified industrial growth projects. While public funding is limited, this commercially informed plan establishes rail construction as attractive to private-sector businesses and investors.