The prospects for the revival of the stalled Hobart light rail service project are looking bright. This is despite the initial assessment of the project as an economically unviable one. It was crucial in offering connecting to the northern suburbs. The government’s changed thinking came after a fresh evaluation of the Hobart light rail by Infrastructure Tasmania.

Tasmania’s Infrastructure Minister Rene Hidding said the government is ready to work with Glenorchy and Hobart City councils in taking the project forward for the future, reports ABC News. The Hobart Northern Suburbs Rail Action Group welcomed the minister’s statement. It appreciated the new emphasis given to benefits from land use.

“These land use benefits have not been considered in previous light rail studies and will bolster the economic case,” president Ben Johnston said.

“A small operating subsidy for light rail may be required but this is normal and needs to be considered in light of the enormous socio-economic benefits and avoided costs of road upgrades,” the lobby group said.

According to initial estimates, the Hobart light rail would incur a capital cost of AU$100 million. But concerns on “significant operational losses” had blocked the final nod on the project. However, the government has indicated that it recognises the project’s long term potential. It will be keen to “preserve the rail corridor from Hobart to Granton.”

The minister said the government can work with the city councils of Glenorchy and Hobart City on matters such as land use, zoning and development of the rail corridor. The mayors of Hobart and Glenorchy had been canvassing hard for the Hobart Light Rail Project as a strategic infrastructure. Hobart mayor Sue Hickey expressed happiness that the corridor has been kept open for the future, reports Mercury News.

Agreeing that the economics may not stack up at the moment, Hickey said addressing the mounting congestion from the northern suburbs should be a priority. Glenorchy mayor Kristie Johnston said, “it is not a yes to light rail tomorrow, but it is a positive step in the right direction.”

In 2013, PricewaterhouseCoopers (PwC) had undertaken a strategic assessment of the Hobart light rail proposal.  It saw merit in the project and pointed to the increasing car dependency in Hobart’s ‘suburban sprawl.’ That trend was affecting the socially disadvantaged and aged segments of the population. The PwC said light rail services can be a good option. Light rail is better as a high quality, faster public transport option and will also support better land use in the northern suburbs.