LONDON Underground has slashed the cost of the planned Chelsea- Hackney line in an attempt to attract private finance.
Its previously favoured route needed 18.8 km of tunnel, and would cost 2.8 billion to build.
But three new options released for consultation last week use spare surface lines, and have fewer intermediate stations.
The shortest of these would use a 10.3 km tunnel and cost only 1.5 billion.
Construction work could begin as early as 2000 if LU wins enough financial and political support.
Bill Clarke, LUs railway extensions director, said: Lengthy tunnelling is expensive. We know that a totally publicly funded line is not possible in the short-term, so we must improve its viability to attract private finance.
The line would be designed to become operational in sections, so investors could earn returns on their outlay as soon as possible.
Mr Clarke said: We want to avoid the problem Eurotunnel had where they had to pay for the entire project before they got any revenue.
The scheme would use a rectangular tunnel suitable for normal railway rolling stock, rather than a circular tube as used for older lines.
Its new options would serve either Fulham, or prominent future development sites at Battersea Power Station or Chelsea Harbour.
Another option is a link from Hackney via Stratford and London Docklands to Woolwich, then through a new tunnel back across south London.