Canada is moving ahead with Alto, a high-speed rail network that will link Toronto and Quebec City, a corridor of about 1,000 kilometres where trains can go up to 300 km/h.
The new line would mean a trip between Toronto and Montreal, Canada’s two largest cities, would take about three hours, instead of the usual six with Via Rail.
For supporters, Alto is a long overdue initiative that will bring Canada in line with other advanced economies. But critics worry the project’s enormous costs cannot be justified by the expected returns.
“There are just so many places where we need investment,” said Matti Siemiatycki, director of the Infrastructure Institute at the University of Toronto. “This project feels like a nice to have, not a need to have.”
The project comes at a time when governments are already facing pressure to balance budgets and invest more in existing transit infrastructure, Siemiatycki notes.
“We’re running huge deficits,” he said. “We need to make sure that [Alto] doesn’t go forward just on nostalgia, or on hope and ambition … and that [the project’s] benefits outweigh the cost.”
Where Canada stands
Canada is currently the only G7 country without high-speed rail. Freight rail companies own Canada’s intercity tracks and give their trains priority, undermining the passenger experience for Via Rail customers.
“There’s no doubt that Canada is behind when it comes to rail — and rail of all types,” said Siemiatycki.
“If you’ve taken VIA [Rail] recently, especially in the Toronto-Montreal corridor, you know the service itself is quaint and charming, but the travel times have become completely unreliable.”
Last quarter, the Carney government’s Major Projects Office recognized Alto as a “transformative strategy” that will have the support of the office, which exists to accelerate infrastructure development.
In December, Transport Canada said it expects to begin consultations on high-speed rail in 2026, and to begin construction of an initial Ottawa-Montreal segment in 2029. In his announcement, Transport Minister Steven MacKinnon said high-speed rail would cut passengers’ travel times in half, increase tourism and housing development along the corridor, and boost the economy.
If implemented, Canada would join the likes of France, Spain, Germany, Japan and China, which have extensive high-speed rail networks with frequent service and dedicated rights-of-way.
Ahmed El-Geneidy, a professor at McGill University’s School of Urban Planning, cautions against treating those countries’ systems as the most relevant benchmark for Canada. He said differences in population density, land-use patterns and investment levels make direct comparisons with Europe or East Asia misleading.
Instead, El-Geneidy says Canada’s closest analogue is the United States — another large, car-oriented country that has struggled to deliver high-speed rail outside select, high-traffic corridors.
“ If you compare to the Europeans, you might find that they [are building] cheaper because they have an abundance of rail that they can take over and build upon,” he said.
“If you look at the Chinese example, they are … using modular [technology and] economies of scale. It’s different.”
Big assumptions
In November, El-Geneidy and two colleagues at McGill released a report pegging the total cost of a high-speed rail network at $80 billion. This figure aligns with Ottawa’s previously stated estimate of $60- to $90-billion.
The report projects the high-speed rail system would become “self-sustaining starting Year 44 onwards,” meaning it would be decades before the project breaks even.
This projection assumes the project is built through a public-private partnership, where Ottawa finances a third of the total cost and private investors finance the rest. It also assumes the value of land near stations increases by about $12 billion.
El-Geneidy said the breakeven estimate is based on a number of optimistic assumptions, especially on the demand side.
“We were very generous in … aspects in our calculations,” he said.
For their study, El-Geneidy’s team had conducted polling of Canadians living near proposed high-speed rail stations. About a third of respondents said they would use the high-speed line at least once a year. Respondents also said they would be willing to pay, on average, just $20 more to ride by high-speed rail than the current Via Rail fare.
El-Geneidy says they used this polling data to inform demand estimates, and assumed demand increased by six per cent a year for the first six years.
“We gave them the benefit of the doubt [that] the demand is going to be really, really increasing very much,” El-Geneidy told Canadian Affairs. He noted his team also made generous assumptions about growth in tourist use, higher prices for weekend rides and land value around stations.
“It can happen,” said El-Geneidy of a breakeven point. “But it requires a lot of work from the government to make it happen.”
Competing priorities
Siemiatycki says the size of the contemplated investment raises important considerations around trade-offs.
“For that amount of money you could build the Eglinton crosstown extension to the University of Toronto Scarborough; you could build the [SkyTrain] extension to the UBC in Vancouver; you could build an LRT project in Montreal that has a giant price tag, over $10 billion; the whole Quebec City LRT that has a price tag over $10 billion; the Calgary Green Line as well; and you’d still have money left over for maintenance and $10 billion to fix the existing VIA [Rail network].
“This is just a staggering amount of money.”
El-Geneidy says the government has committed to moving ahead with Alto, so the more pressing question now is how to structure the project to minimize the long-term burden.
“Clearly, the Alto train has left, and this project will be built,” he said. “So now we have to make sure it happens in the best way — so my children are not paying for it for the rest of their lives.”
In an emailed statement to Canadian Affairs, Transport Canada said it could not provide an estimate for when the initial Ottawa-to-Montreal corridor would be operational. It emphasized the expected benefits of the project.
“[The] project will revolutionize transportation along the country’s busiest corridor and is anticipated to generate spin-off economic benefits for Canadians by creating jobs, attracting investments, and improving connectivity between Canada’s key economic centers,” the spokesperson said.
There will be a significant benefit when passengers take the train rather than flying. Lower capital and operating costs for the airports which that are already overloaded.
I am beyond understanding why Canadian taxpayers all across Canada are expected to pay for rail between Ottawa and a province that wants to separate from said country?
There will be significant disruption in places along the high speed rail corridor. Here in Peterborough, land costs will rise, while median income will not. Housing pressure will become worse than it already is. It is already pretty bad. I can’t help but think that there could be wiser ways to use 80 billion dollars in Ontario. Boring a tunnel under the 401 would not be one of these, I hasten to add. This isn’t the place for a diatribe, but it doesn’t take long to find extensive arguments against this initiative.
Simply an $80 billion (probably closer to $200 billion by the time its in place) government boondoggle! And a 40-100++ year payout, forget it. Spend taxpayer $$$’s on something worthwhile!!