ScotRail Green Bonds Could Save £362m on Train Replacement

ScotRail could save up to £362 million on new trains by using green bonds, shifting from private financing to public investment for sustainability. This is reported by the railway transport news portal Railway Supply.

Public Investment Could Transform ScotRail Financing Strategy

Trade union leaders are urging the Scottish Government to fund the replacement of ScotRail’s ageing train fleet through green bonds, potentially saving hundreds of millions of pounds.

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A new University of Glasgow study, commissioned by the Aslef union, supports this proposal and highlights the inefficiency of current financing models.

Instead of relying on private rolling stock companies and expensive leasing schemes, the research suggests that Scotland could use its borrowing powers to issue green bonds. According to Professors Andrew Cumbers and Grace Brown, this shift could lower costs by up to 70%, saving between £144 million and £362 million over time.

Private finance initiatives (PFIs) and non-profit distribution models have been criticized for diverting funds from the public sector into shareholder dividends. Kevin Lindsay, Aslef’s Scottish organizer, called for a break from what he described as a “failed model” that enriches offshore investors instead of reinvesting in the transport system.

Green Bonds Offer ScotRail a Path Toward Lower Costs and Sustainability

As part of its climate strategy, the Scottish Government aims to phase out diesel trains by 2045. The transition to battery, electric, or hydrogen-powered trains aligns with national decarbonization goals. However, current procurement delays and reliance on private capital threaten progress.

Green bonds, issued through Scotland’s global capital investment plan, could finance this transformation while keeping revenues within the public system. The study argues these funds should support local jobs, infrastructure, and fare reductions, creating a railway that benefits the public—not private shareholders.

Transport Scotland acknowledged the findings and confirmed that any decisions regarding future train procurement will align with broader infrastructure investment plans. Officials also highlighted that public ownership offers the opportunity for long-term planning and sustainable service delivery.

With mounting pressure to modernize ScotRail, the choice between private profit and public reinvestment has never been clearer. Green bonds may hold the key to building a rail network that’s affordable, sustainable, and future-ready.

Source: www.scotsman.com

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