A transportation system that could eventually see people travel between Edmonton and Calgary in about 45 minutes has taken another step forward.
Toronto-based TransPod announced Tuesday it has secured US$550 million in financing for its multibillion-dollar hyperloop system.
UK-based Broughton Capital Group, in cooperation with China-East Resources Import & Export Co., have agreed in principle to provide a combined US$550M finance and Master EPC arrangement respectively, to accelerate the development of a TransPod Line between Edmonton and Calgary.
“To finance the first phase of the project, which consists of the airport connection of Edmonton,” said Sebastien Gendron, co-founder and CEO of TransPod.
The high-speed transportation system is being developed to carry passengers and cargo in a low-pressure tube environment at 1,000 km/h. Described as an aircraft without wings, the vehicles would be powered by electrically driven magnetic propulsion, according to the company.
Gendron said this initial investment is a key step in the overall project, because it proves there’s a market for it.
“It’s actually a recommendation we got from financial institutions,” he said. “They were saying that we may have the best tech in the world, but if there’s no market we’re not going to go really far. So that investment, it’s confirming that there is an interest to build such infrastructure.
“We have the momentum and the dynamic to develop the technology associated to this project. So that’s a key milestone for TransPod, definitely.”
TransPod said the Master EPC arrangement is expected to involve a “significant contribution” from Canadian contractors.
“As the first and only company to confirm such finance for a multibillion-dollar tube-transportation infrastructure project, TransPod is proud of its commitment to driving growth in Alberta through true innovation and partnership,” Gendron said.
“The construction and operation of a TransPod Line will help Albertans move around easily, create new jobs and facilitate investment into the region. With the confidence of our investors and the government of Alberta, we will deliver on a joint vision of a progressive, sustainable and growing economy.”
A feasibility study released last year estimated the project would create up to 140,000 jobs and add $19.2 billion to the region’s GDP throughout the construction.
The study also projects the tube-based transportation would be able to make the 300-kilometre trip between Edmonton and Calgary in 45 minutes, for an estimated cost of $90 per person.
“TransPod is an exciting, game-changing leader for the future of green infrastructure and transportation in Canada and beyond,” said Terry Parker, executive director of Building Trades of Alberta. TransPod has partnered with Building Trades of Alberta to leverage its regional expertise to support regional job development and provide employee training for the TransPod Line.
“Not only will it help Canada tackle its carbon goals, the Alberta TransPod project will create thousands of well-paying, community-supporting jobs for Alberta’s skilled trades workers, including those from Indigenous communities, women, new Canadians and apprentices,” Parker said.
In August 2020, TransPod signed a memorandum of understanding (MOU) with the government of Alberta to support the development of its hyperloop system.
Also Tuesday, TransPod outlined the next phases of the Alberta project:
- Short-term: Research and development; construction permit; environmental assessment; land acquisition (present-2024)
- Medium-term: Test track construction, high-speed tests, and certification (2023-2027)
- Long-term: Construction of a full inter-city line between Edmonton and Calgary (to begin in 2027)
TransPod is still awaiting approval from the Alberta government and Gendron confirmed the province has not yet committed any money to the project.
“In the short-term, we’re looking at the final approval from the government. We need the green light. Hopefully we’ll get that by the summer and as soon as we have that green light, we’ll be able to establish the disbursement plan for that US$500 million,” he explained.
In a statement, Transportation Minister Rajan Sawhney said the provincial government continues to look at the feasibility of the proposed project.
“I congratulate TransPod on securing this private investment. Alberta’s government is always encouraged to see innovative private sector ideas that have potential to grow our economy and create jobs,” read the statement.
TransPod will need to negotiate the land acquisition for the test track with the City of Edmonton and Edmonton International Airport. There is no government of Alberta involvement in that process.
“The more we progress, the closer we are. In addition to this milestone, we have a another announcement planned for mid-May. We’re building right now a functional prototype and we’re going to showcase it to the public in May.”
Gendron said the prototype will be showcased in Toronto, with hopes of then shipping it to Alberta so people here can see how the technology will work.
“We’re glad to have found Alberta. I would say today, from our point of view, Alberta is leading the innovation agenda from Canada and I would say without Alberta we wouldn’t be there today.”
‘A long way to go’
Matti Siemiatycki is a professor of geography and planning at the University of Toronto. He said when it comes to the hyperloop technology, while there has been a lot of enthusiasm behind it, there’s also a lot of uncertainty.
“This is a brand new technology that is still really in the research and development stage and really needs to be further tested,” he explained.
When it comes to transportation, Siemiatycki explained that there are always a variety of technologies being pitched at any given time, and they’re all competing with each other to be turned into reality.
“With transportation, for every 99 of these that don’t happen, there’s one that comes along that does hit and that actually could potentially change the world,” he said.
That’s no reason not to pay attention, though, according to Siemiatycki. He said the fact private investors have come forward with funding does give some indication it’s a project to watch. But he warned that there are still many hurdles facing the project.
“The money coming forward now is noteworthy, but it still really shouldn’t supersede the technical challenges as well as the social and political dynamics to make a project like this real,” Siemiatycki said.
“To be able to move that quickly with a technology that still requires considerable research and development, plus all the permitting, plus all the safety checks… I think there’s a long way to go.
“There’s a long way to go before you’re either riding this yourself or looking out the window with envy, wishing you were on it.”
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