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Social Cost-Benefit Analysis of Retbus

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Social Cost-Benefit Analysis of Retbus Cost-Benefit Analysis of RetBus A new Bus Rapid Transit system in Barcelona Master thesis: Final report 14 June 2011 Author: Bernat Goñi Ros (1560255) MSc Transport, Infrastructure and Logistics Delft University of Technology [email protected] Thesis committee members: Prof. dr. ir. Bart van Arem (TU Delft, CEG) Dr. ir. Rob van Nes (TU Delft, CEG) Dr. Hans van Ham (TU Delft, TPM) Dr. ir. Miquel Estrada (UPC Barcelona TECH, CENIT) Cost-Benefit Analysis of RetBus Acknowledgements This thesis is the result of my research on the RetBus project in the past nine months. The thesis would not have been possible without the guidance of the members of my thesis committee, who closely monitored my research progress, addressed my multiple questions and continuously challenged me to do things better than I thought I could do. For that reason, I would like to sincerely thank Bart van Arem, Rob van Nes, Hans van Ham and Miquel Estrada. Also, I would like to thank Mireia Roca-Riu and Mateu Turro (Center for Transport Innovation, Barcelona TECH), for providing me with the input data that I needed for my research and for their comments on how to improve the research methodology and analyze the results. In addition, I would like to thank OmniTRANS, especially Peter Kant, for assisting me in building the transport model and analyzing the results and for his willingness to help me in all circumstances. I would like to thank Claire Minett (Department of Transport and Planning, TU Delft) for her valuable remarks on English grammar and writing style. Furthermore, I would like to thank all the other master students who worked on their graduation projects in the same office room of the Department of Transport & Planning as me during the last months. Their contributions to my research and their daily support were really helpful. This thesis is also the culmination of my master studies at Delft University of Technology, which I started in February 2009 with the intention of acquiring the knowledge and skills necessary to work in the field of transport planning. Looking back, I can see that my decision to enroll in the master program Transport, Infrastructure and Logistics was a good decision. However, I do not forget that I could not have finished my studies without the support of many people. First, I would like to thank the TIL community (professors, lecturers and classmates) for helping me to progress with my studies and giving me support during the last two years. I would also like to thank Fundación Caja Madrid for giving me a scholarship and for extending it when I needed it. I could not have finished my master and my thesis without that scholarship and I feel an immense gratitude for the opportunity I was given. I would like to thank my friends in Delft for all their help and the good times we had during the last two years. Finally, I would like to express my most sincere gratitude to my family and friends in Barcelona, who believed in me, supported my decision to come to the Netherlands and gave me strength to carry on with my studies. I dedicate this thesis to my parents, who always devoted a lot of time and energy to my education and wellbeing. i Cost-Benefit Analysis of RetBus Summary A. Background and motivation A1. What is the RetBus project? The RetBus project is a plan of the City Council of Barcelona (Spain) and the transit operator Transports Metropolitans de Barcelona (TMB) which aims to improve the public transport service in the city. The project involves building a new Bus Rapid Transit (BRT) system called RetBus and eliminating or modifying some existing bus lines. The main design objective of the RetBus project is to provide a higher quality bus service to transit users at a lower cost for the operator (TMB). The BRT network has a hybrid grid-radial structure and comprises 11 BRT lines, some of which are composed of two different sub-lines overlapping in the central segment (see Figure 0-1). On average, stop spacing is 650 m (433 in the city centre), service frequency is 20 services per hour (10 in peripheral line segments) and operational speed is 15 km/h. The new BRT system has been designed to provide a service of intermediate quality between metro and bus; therefore it is expected to attract current users of both systems. In addition, the RetBus system is expected to improve the competitiveness of the public transport network as a whole, thus attracting current private vehicle users. Figure 0-1: Map of the RetBus network. A2. Purpose of the study This report presents the results of a cost-benefit analysis (CBA) of the RetBus project. TMB and the City Council of Barcelona need to make a decision on whether or not to proceed with that project; therefore, it is necessary to make a complete assessment of its most relevant effects. ii Cost-Benefit Analysis of RetBus TMB and the City Council would like to know not only whether or not the implementation of the RetBus project will result in adequate returns to justify the investment costs, but also the extent to which socio-economic welfare will increase in the region of Barcelona as a result of the realization of that project, thus considering the net benefit to society as a whole. Based on the results of that evaluation, the report also presents some recommendations on what type of changes could be made to the project in order to make it more socially beneficial and/or financially profitable. The main research questions this thesis aims to answer are: 1) To what extent will the implementation of the RetBus project be socially and financially beneficial?; and 2) What modifications could be made in the RetBus project so as to improve its social and/or financial value? B. Methodology B1. What is cost-benefit analysis? Cost-benefit analysis (CBA) is an economic evaluation method which is frequently used in the public sector to evaluate the desirability of transport projects. Essentially, CBA identifies all the relevant effects of a given project in a systematic way and indicates the extent to which the benefits generated by the project will exceed the costs of its implementation. Both costs and benefits are valuated in monetary units, preferably on the basis of market prices. Two types of CBA have been carried out in this study: financial cost-benefit analysis (FCBA) and social cost-benefit analysis (SCBA). FCBA looks only at the financial-economic effects of a given project, i.e. investment costs, operating costs and revenues. Therefore, it evaluates the project from the viewpoint of the investors and operators. In contrast, SCBA evaluates all relevant effects of the project from the perspective of society as a whole. SCBA includes the effects analyzed in FCBA plus additional items which have a socio-economic value, such as environment, mobility and safety. B2. Appraisal period and project variants The time horizon of the evaluation is ten years (2012-2021). The base case has been defined as a scenario in which the RetBus project is not realized. Two project alternatives have been analyzed: Alternative 1 (TMB plan) and Alternative 2 (Cost-reduction plan). Alternative 1 (TMB plan) corresponds to the RetBus project as it would be implemented according to the plans of TMB: the BRT system is implemented and some changes are made in the bus network in terms of routes and service frequencies (7 bus lines are eliminated, 7 lines are shortened, the frequency of 22 lines is reduced and the frequency of one line is increased). Alternative 2 (Cost- reduction plan) contains all the elements of Alternative 1 plus additional changes to the bus network (namely, 21 extra bus lines are eliminated). B3. Identification of project effects Table 0-1 identifies and defines the most relevant effects of the RetBus project. It also identifies the most relevant social-economic parties affected by the implementation of the project. iii Cost-Benefit Analysis of RetBus Table 0-1: Inventory of project effects and affected parties Project effect Definition Affected parties BRT investment Initial investments in the BRT infrastructure and the TMB / Government costs vehicles needed to operate the BRT system Change in fleet Change in the costs of renewing the vehicle fleet of the TMB / Government replacement costs bus and BRT systems Change in Change in the costs of operating the bus and BRT TMB / Government operating costs systems (fuel and personnel costs) Change in Variation in the total amount paid in fares by all transit TMB / Government operating revenues users Transit user Variation in the total consumer surplus of transit users Transit users benefits Safety effects Variation in external accident costs Society Environmental Change in external environmental costs (i.e. noise, air Society effects pollution and climate change costs) B4. Travel demand forecasts Travel demand forecasts are necessary to estimate some effects of the RetBus project. In this thesis, forecasts have been produced by means of a model based on the traditional four-stage model. First, a growth factor model has been used to forecast future total trip demand by updating an observed base year matrix. Trip growth rates have been assumed to be equal to predicted rates of population growth. Second, a multinomial logit mode choice model has been used to perform modal split. That model has been calibrated based on observed data. Finally, two different models have been used to assign transit and private vehicle travelers to the transit and roadway networks. The assignment of transit trips is based on a multinomial logit model, while private vehicle trips have been assigned by means of a deterministic user equilibrium (DUE) model.
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