A Canadian pension fund wants to roll up its sleeves and roll out Auckland's $6 billion modern tram project capable of moving 11,000 commuters an hour.

Ideally, CDPQ would like to be consulting shortly with business owners on Dominion Rd and other places where modern trams - also known as light rail - will run, but first it has to be selected for the job.

Jean-Marc Arbaud, CDPQ's deputy managing director of infrastructure, told the Herald that Quebec's pension fund wants to design, build, own and operate light rail in Auckland.

This is an exciting opportunity to show the model for procuring light rail in Montreal can be tailored in a new environment


CDPQ, with funds of about $350b worldwide, has teamed up with the NZ Super Fund to form an international consortium and submitted an unsolicited proposal to the Government.


Senior Government ministers welcomed the proposal in May, but said the procurement process would be open to allcomers. The New Zealand Transport Agency is setting up the procurement process, expected to be under way at the end of the year.

Arbaud said the Canadians and the NZ Super Fund wanted to make a long-term commitment to light rail under a model that keeps debt off the Government's balance sheet.

Using the design-build-own-operate model, CDPQ has built a 20km light rail line between Vancouver's CBD and the city's airport and began construction in April on a 67km light rail network in Montreal costing $7.3b.

Not only does the CDPQ model design the network and services, it sets timetables and, in the case of Montreal, changed bus services running in the direction of light rail from every 30 minutes to every 10 minutes to improve efficiency.

Arbaud says the Montreal network will be half completed by 2021 and fully completed in 2023. The REM, as it is known by its French acronym, will be the fourth longest automated transport system in the world.

Under a contract with the city's transit authority, CDPQ carries all the risk on ridership and gets paid about 73 cents per passenger kilometre to cover all its costs of capital and operating the network.

This is about 1 cent more than the transit authority currently pays in operating costs for public transport, Arbaud said.

"You have to demonstrate that you are very efficient and that it will work...you have to be sure your costs of operation are very competitive because if they are not you will have a problem one day or another."

Benedicte Colin, CDPQ's director in Sydney, pointed to Sydney's light rail project, which has been plagued by problems and contractors suing the State Government for being misled on the complexity of moving underground utilities.

The earlier a partner is brought into the discussions to avoid pushing the risk of things like utilities on to the private consortium, the better, she said.

Arbaud and Colin are keen for CDPQ to be involved in consultation on light rail in Auckland at the outset to get a handle on the feelings and concerns among communities, and build long-term relationships.

"This is an exciting opportunity to show the model for procuring light rail in Montreal can be tailored in a new environment and with a strongly-aligned partnership," said Arbaud.