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2. Fare Policy and Integrated Ticketing Strategy

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2. Fare Policy and Integrated Ticketing Strategy Technical Assistance Consultant’s Report Project Number: TA No. 7044-THA February 2009 Thailand: Bangkok Mass Rapid Transit Integrated Ticketing Project (Financed by the Japan Special Fund) Final Report Prepared by CECI Engineering Consultants, Inc., Taiwan TAP For Office of Transport and Traffic Policy and Planning, Ministry of Transport, Thailand Asian Development Bank This consultant’s report does not necessarily reflect the views of ADB or the Government concerned, and ADB and the Government cannot be held liable for its contents. For project preparatory technical assistance: All the views expressed herein may not be incorporated into the proposed project’s design. Thailand: Bangkok Mass Rapid Transit Integrated Ticketing Project Technical Assistance Consultant’s Report Table of Contents Summary ...............................................................................................................................................I Abbreviation Reference Table...........................................................................................................VIII 1. Introduction ...................................................................................................................................1-1 1.1 Background............................................................................................................................... 1-1 1.2 Objectives ................................................................................................................................. 1-2 1.3 MRT Systems in Bangkok ......................................................................................................1-2 2. Fare Policy and Integrated Ticketing Strategy..........................................................................2-1 2.1 Key Findings from Previous ADB TAs............................................................................... 2-1 2.2 Objectives of an Integrated Ticketing System .................................................................... 2-4 2.3 Fares Structure ......................................................................................................................... 2-5 2.4 Fares Models............................................................................................................................ 2-8 2.4.1 MRT Price Elasticity of Demand ......................................................................... 2-8 2.4.2 Testing of Various Fares......................................................................................... 2-9 2.4.3 External Benefits..................................................................................................... 2-14 2.4.4 Suggested Fare Model............................................................................................. 2-15 2.5 Fare Products........................................................................................................................... 2-15 2.6 Fare Policy Conclusion ........................................................................................................... 2-17 2.7 Implementation Strategies for the MRT Common Ticketing System ............................. 2-17 2.8 Current MRT Operator Plans for Establishing a JV Company to Issue Common Tickets on Their Own Systems ................................................................. 2-23 2.9 Applications of Electronic Money (E-money) and Electronic Tickets (E-ticket)......... 2-23 3. Procurement for Back-end System ............................................................................................3-1 3.1 Introduction ............................................................................................................................. 3-1 3.2 Procurement Method and Procedure................................................................................... 3-2 3.3 Appraisal Mechanism.............................................................................................................. 3-5 3.4 System Requirements .............................................................................................................. 3-7 3.4.1 Central Clearing House (CCH).............................................................................. 3-7 3.4.2 Card Issuing Machines (CIM)................................................................................ 3-12 3.4.3 Key Management System (KMS) .......................................................................... 3-13 3.5 System Specification Recommendations and Cost Estimation ........................................ 3-15 3.6 System Operation and Maintenance..................................................................................... 3-19 3.7 System Technology Transfer.................................................................................................. 3-23 3.8 Potential Risks.......................................................................................................................... 3-24 4. Determine Financing Requirements and Funding Strategy...................................................4-1 4.1 Introduction ............................................................................................................................. 4-1 4.1.1 Overview of Project................................................................................................ 4-1 4.1.2 Financial Analysis.................................................................................................... 4-1 4.2 Financial Model........................................................................................................................ 4-2 4.2.1 The Model................................................................................................................4-2 i Thailand: Bangkok Mass Rapid Transit Integrated Ticketing Project Technical Assistance Consultant’s Report 4.2.2 The Model Cases ..................................................................................................... 4-3 4.2.3 The Business Model ................................................................................................ 4-6 4.2.4 The Investment Costs............................................................................................. 4-7 4.2.5 The Revenue............................................................................................................. 4-9 4.2.6 Operations & Management Costs......................................................................... 4-11 4.2.7 Financing................................................................................................................... 4-14 4.2.8 Projected Financial Performance .......................................................................... 4-14 4.2.9 Transaction Fee........................................................................................................ 4-15 4.2.10 Sensitivity Analysis................................................................................................... 4-16 4.3 Project Value for Money Assessment................................................................................... 4-17 4.3.1 Introduction.............................................................................................................. 4-17 4.3.2 Funding Options...................................................................................................... 4-18 4.3.3 VfM Analysis............................................................................................................ 4-18 4.3.4 Analysis Results........................................................................................................ 4-21 4.4 The Management of the Fare-based Revenue Streams as well as the Smartcard Funds Pool......................................................................................................4-22 4.4.1 The Smartcard Pool (Pre-paid Account).............................................................. 4-22 4.4.2 The Working Capital Account ............................................................................... 4-23 4.5 The Financing and Funding Strategy.................................................................................... 4-24 4.6 The Financial Management of the Government Agency.................................................. 4-24 4.7 The Investment Recovery Plan for the Government......................................................... 4-25 4.8 Forming a Common Ticketing Company (CTC)................................................................ 4-27 4.8.1 The Establishment of CTC ................................................................................... 4-27 4.8.2 The CTC Registration Process .............................................................................. 4-31 4.8.3 The Applying for the E-Transaction Licenses .................................................... 4-33 4.8.4 Other Issues on the Forming of CTC ................................................................. 4-34 4.9 Smartcard Regulations ............................................................................................................ 4-36 4.10 Operation of a Common Ticketing Company (CTC) and Related Issues of Transportation Policies............................................................................ 4-37 5. Governance Structure and an Implementation Plan...............................................................5-1 5.1 Organization Structures of MRT Systems in Bangkok ....................................................
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