I think the future of transit in Surrey comes down to the Surrey people want to create. There are 2 paths, each with their own pros and cons.
1) Skytrain.
Skytrain, in Metro Vancouver is primarily a regional transit system. It is designed to (and does) connect separate town centers and provide connections between them so that residents in one center can take advantage of amenities in another, all the while providing a high speed commuter link to Downtown Vancouver (the greatest amenity of them all). At the town centers, bus routes converge and provide local connections for people and businesses not located in the centers. This allows much of the population throughout Vancouver, Richmond, Burnaby, New West, Coquitlam and Surrey to have a short bus ride to the transportation backbone that can carry them great distances.
What this does do however is create nodes around which these centers grow. In practice, most of the town centers are really residences for people who work downtown. The Skytrain offers them a rapid transportation method downtown. Around most town centers, only locally based service businesses take hold, and most town centers do not develop their own economy with local high paying jobs.
There is nothing wrong with that, and is in fact quite sustainable. It allows people who do not have the opportunity or the finances to live close to where they work the ability to chose where they live, and make longer commutes without sacrificing that much time. But what it does do is maintain regional focus on the major centers: Downtown, Richmond, Metrotown.
Surrey City Center is growing, but right now it is still the place where Skytrain leaves.
If it is extended to Guildford, Guildford will be the end of the line. The Skytrain will take people away from Guildford and bring them East. Most residents moving into the area after Skytrain will be doing so to take advantage of the high speed link to places other than Guildford. People who currently bus to City Center for work will be replaced by wealthier residents who Skytrain into Burnaby and Vancouver.
@XD, the Guildford mall will not be a regional destination, ever. People will not come from any further than King George. Why would most people not just take an extra 10 minute ride to Metrotown, or even downtown? And most of the mall's current patrons, people to the South and East, won't be getting there by Skytrain if it is built. They would still have to drive or bus to the mall. The mall might see an increase in traffic from people passing through, but malls are typically not major regional destinations, unless the mall is a one of a kind. While you see Skytrain bringing in people to Guildford Mall, I see Skytrain taking far more people away, to better places.
So, if Surrey wants to make (or keep) Guildford a part of town where people leave in the morning to head to Downtown Vancouver and come back in the evening, then Skytrain is the best choice. It will offer commuters leaving Surrey the best transportation possible.
2) LRT.
LRT can create a different Guildford neighborhood. By not being connected to the Regional backbone, Guildford can be more Surrey focused. Instead of being a Vancouver Suburb, it can be a Surrey City Center Suburb.
LRT on 104 Ave, with more stops than Skytrain, can create a vibrant community the length of the road where none exists. 104 ave right now is so desolate, that they can't even find a tenant for the 104 Ave center, and it still sits empty. Most of the road is lined with dilapidated buildings and many empty and under used lots. Skytrain would not solve this. At best, there might be 1 other station between King George and Guildford, and this might contribute to some growth, but most of the street, especially the western sections, would say the same.
LRT can create an enticing business environment where many of the existing buildings are replaced by higher density dwellings and more businesses. The more frequent LRT stops will spread out the population instead of concentrating it at the mall, making more walkable neighborhoods reducing dependency on the automobile to get regular chores done.
The LRT will bring these residents fairly quickly to downtown Surrey. This can create critical demand for more office space in the city's center and create more then just residential growth, but contribute to Surrey's economy and business tax base. From the City Center, more LRT lines can be built, creating a funnel bringing in people from all over the city to their own downtown.
The LRT will also serve the mall, bringing in residents from more stations along 104 Ave. Whereas a Skytrain might only pick up people at 144 St. Skytrain will serve more people leaving Guildford going to Vancouver while LRT will serve more population along the line, giving them equal cost (in time) between going to the mall or elsewhere, making their choice of going to the mall that much higher.
People who do work outside the city will still have access to Skytrain, like they do now. But the LRTs will be able to handle larger numbers of commuters and offer greater reliability and speed over the buses they replace. This will still drive up demand for Skytrain into Vancouver, but the LRT will create a positive business environment at Surrey City Center.
The distance between Guildford and City Center on 104 Ave is not that great. The 501 is scheduled to make that trip in about 10 minutes. An LRT with dedicated lanes and favorable signalling can probably make or beat that. So if you were to shave off a minute or two with Skytrain, I don't see what the advantage is. You reduce the need to Transfer to Skytrain, but again, that facilitates travelers leaving Surrey. If that is what you want to create, then Skytrain is the best choice.
But if you want to grow the City Center and make Surrey more self sufficient then LRT deserves a credible analysis. The city is currently large and spread out, with multiple smaller town centers, not all nicely aligned along a central, high demand route. Extending Skytrain to each of these is not economically feasible and still maintains Surrey's Vancouver Centric position.
However, it does sacrifice regional mobility at the hands of creating better communities. Which is why a third alternative will most likely be considered.
3) Both.
Skytrain only becomes advantageous to the City of Surrey's economy if it brings in people from further away. The distance between Guildford and City center is so short, there is hardly a difference between them. Be it Skytrain or LRT, if you are going from the Mall to the Mall, either would take about the same time.
But Skytrain has it's advantages when bringing in people from further away. Which is why many advocate its use on the Fraser Highway. Fleetwood is further from City Center than both Guildford and Newton (almost as far as both of them combined). The time savings there would be far more noticeable for travel to City Center.
It also brings the Regional Transportation backbone closer to far more people. While the Guildford Skytrain would be great at serving about 50,000 people (who already have amazing access to Highway 1 and soon to be rapid bus for their regional transit needs) heading towards Fleetwood brings Skytrain closer to the majority of people in East Surrey (East Newton, Fleetwood and Guildford, a population of almost 100,000 while also being a much shorter bus trip in from Cloverdale and Langley).
Extending further to Langley bridges the gap between Langley City Center and Surrey City Center, creating a SOF regional backbone. Most of the SOF population would be a 10 minute or less bus or LRT ride away regional transit. While that is not needed soon, SOF is becoming more densely populated and internally focused. SoF will one day require a backbone that locally focused LRT and frequent buses can bring people to for their longer trips. One day, commerce and travel between Langley City and Surrey will be far more important than it is today, and when that time comes, Skytrain to Langley will be critical to the growth and sustainability of the SoF community.
I can see a future where Skytrain provides a regional backbone connection between Downtown Surrey, and Downtown Langley, and links them to the larger regional network. And LRT is used to feed all those major centers, with lines operating on 104, King George, 200 St, and maybe even streets in between, connecting the smaller, more spread out town centers with the city centers.