Hyperloop or just hype? Panel’s report says Missouri could be site of first test route

With a request for a proposal on the horizon from the leading hyperloop company, Missouri is positioning itself to win a bid to place a 12-to-15 mile test track in the state, with an eye to becoming the nexus of the futuristic transportation system.

Missouri leaders released a 176-page proposal Monday on the costs and benefits of a system that seeks to use enclosed tubes to shoot pods of light freight — and eventually people — up to 670 miles per hour.

It made clear that the project can only be achieved with private investment.

This spring, Missouri House Speaker Elijah Haahr convened a bipartisan “Blue Ribbon Panel” to examine ways to speed up development of a hyperloop route in the state. The end goal would be a magnetic track stretching from Kansas City to St. Louis, with a stop in Columbia, cutting a statewide drive of four hours to 30 minutes.

The state expects Virgin Hyperloop One — the only company yet to have a successful test track in the United States — to soon seek states to place a lengthier test track, according to the panel’s vice chair, Andrew Smith. A letter has been sent to governors alerting them of the RFP, Smith added.

Smith said the company has confirmed Missouri is a top contender, partially because of the engagement of elected officials and the state’s business leaders.

“You won’t see another state in the country where the speaker of the house, the lieutenant governor, the director of the department of transportation, the department of economic development director and a bunch of legislators sit in a room for six months along with business leaders to figure out how to get a project going,” Smith said. “...We’ve done the work.”

At a news conference on Monday, Haahr said he expects Missouri to issue multiple proposals to place the test track in Kansas City, Columbia or St. Louis.

“It allows us to not just compete as a Kansas City region, but it allows us to leverage the entire state of Missouri, frankly the states of Kansas and Illinois and all of us here in middle America,” Kansas City Mayor Quinton Lucas said at the news conference.

Last month, Virgin Hyperloop One CEO Jay Walder told The Star his company’s hyperloop technology is nearly ready for deployment. It’s been tested more than 400 times in Nevada and the company plans to name a location for the first real-world site soon.

The hyperloop electronically shoots a pod through a depressurized tube. Magnets line the tube and levitate the pod like an air hockey puck. The lack of air and friction allow it to reach a high speed quickly and sustain it with minimal energy. In Nevada, Virgin Hyperloop One has achieved test speeds up to 245 miles per hour, though the company expects the tubes to eventually exceed 670 mph.

Walder brought a test pod to the American Royal World Series of Barbecue at the Kansas Speedway.

“We’re right on the cusp right now,” he said.

While the ultimate goal remains to build a commercial route, the state panel recommends first building a track of up to 15 miles for regulatory review and safety tests. The study views that as a key advantage in the race to establish Missouri as a hyperloop leader.

The proposal to connect Missouri’s three population centers along the Interstate-70 corridor would help create a “megaregion” that would rival the nation’s top 10 metro areas, according to the study.

The tubes would connect Lambert Airport in St. Louis, Truman Sports Complex in Kansas City and the University of Missouri in Columbia.

By drastically cutting travel time, the route would essentially merge now-separate supplier networks and labor pools. Cerner, for instance, would have quick access to researchers at the University of Missouri and high-skilled workers in St. Louis.

Cutting travel time for high-paid workers is estimated to save employers as much as $561 million per year.

The study says that a test track would position Missouri as the “natural epicenter” for research, development and commercialization of the technology and dissuade other regions from duplicating efforts. In essence, whoever lands the test track first will emerge as a national leader.

“There will be no prize for second place” it says.

Smith said he views Texas and Ohio as Missouri’s top competition.

“It’s an opportunity that’s directly in front of us,” said Ryan Weber, president and CEO of the KC Tech Council and a member of the panel. “We could be first. And being first with a project like this could have significant long-term economic benefit for the state.”

The study purports several benefits of a statewide hyperloop route, including:

  • An economic impact of $1.67 billion to $3.68 billion
  • The creation of 7,600 to 17,200 jobs
  • The reduction of carbon dioxide emissions by more than 530,000 metric tons
  • The reduction of as many as 1,564 traffic accidents per year

The project is expected to cost $7.3 billion to $10.4 billion — as much as $40 million per mile. That’s a burden the state cannot bear alone, the report says, and will require a public-private partnership to fully fund.

“However, it is clear that Missouri is the most attractive place to begin a national hyperloop system and therefore beginning in Missouri is the best interest of the nation,” the report reads.

A different study by Overland Park’s Black & Veatch engineering firm released in October 2018 concluded that idea could be commercially viable: The geography along I-70 is conducive to hyperloop, particularly since the Missouri Department of Transportation owns much of the right-of-way along the interstate.

On the research front, the report calls on the University of Missouri system to establish itself as a leader in the field. The university has already started work to form an International Tube Transport Center of Excellence.

The report proposes MU to partner with research universities in nearby states like Illinois, Indiana and Iowa.

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Virgin Hyperloop One released this rendering of what a hyperloop terminal might look like near downtown Kansas City.

How to fund the hyperloop

But Monday’s report provides no solid source of initial funding.

“I know there’s still a lot to be answered,” Weber said. “But in the meantime we can be excited about what opportunities this is going to bring to the region and to the state.”

Developers could apply for some federal transportation grants, issue tax-exempt bonds through the department of transportation and work with the port authorities in Kansas City and St. Louis to enter development agreements with private contractors.

The report also points to the possibility of foreign investment. Saudia Arabia has a large investment fund set aside just for infrastructure projects, Smith noted.

To move forward, the report says the project needs to secure $50 to $100 million for research and development within the next three years.

It recommends identifying a project sponsor and eventually creating a Missouri Hyperloop Corporation to develop a “responsible” financial plan that mitigates taxpayer risk.

“That’s always the key question and it’s the right question to keep asking,” Weber said. “I want taxpayers to know they’re not going to be asked to take the burden of something like this on.

Smith said he envisioned much of the private capital needed to jumpstart the track to come from hyperloop companies like Virgin Hyperloop One.

“They are going to need to have significant skin in the game,” Smith said.

The report highlights multiple risks of the project: The technology may not work over long distances, it may never be certified for human safety by federal regulators and it may never draw the kind of private capital needed. Likewise, the study says the project may never be self sustaining, requiring ongoing government subsidy.

But the house speaker said all transportation breakthroughs, whether in the way of the steamboat or the interstate highway system, were met with widespread uncertainty before adoption.

“Every step forward in innovation is going to come with risks,” he said.

But private funders will likely remain wary until there’s more clarity around the regulatory framework for hyperloop transportation. U.S. Transportation Sec. Elaine Chao announced a new council in March designed to explore the regulation and permitting of hyperloop technology. But that’s just the first step in a years-long approval process.

“There’s just so much to still be determined about that from a federal level,” Weber said. “I think this is a bit of a call to action to our federal officials to figure this out.”

The Virgin Hyperloop One pod was on display at the American Royal World Series of Barbecue at the Kansas Speedway in September. Shelly Yang

Kevin Hardy covers business for The Kansas City Star. He previously covered business and politics at The Des Moines Register. He also has worked at newspapers in Kansas and Tennessee. He is a graduate of the University of Kansas