ANALYSIS AND EVALUATION OF ROAD PRICING BENEFITS AND COSTS

Mr. John MaoDr. André DantasDr. Alan NicholsonDepartment of Civil Engineering

Presentation outline

Context

Objective

Method to assess benefits and costs of road pricing projects

Case Study

Conclusions

Context

Road pricing in urban areas

Singapore and London experiences: road pricing as constitutes a planning instrument; andConcerns about long-term impacts and reliability of project evaluations.

•Instrument for reducing of the adverse impacts on the environment, including air pollution, accidents and noise (Button and Verhoef, 1998);

Context

Road pricing in theory

Mechanism to apply marginal charges (Bell and Iida, 1997);

•The most efficient allocation of resources results when travellers pay the marginal cost inclusive of the externalities (Economic Theory)

Used for congestion relief based on travel time both in cost functions and project evaluations

Context

Road pricing: benefits versus adverse impacts

Benefits estimated from reduction net travel time1st and 2nd Wardrop’s principles

•Project evaluation assumes that the road network can be controlled to reach the best use of the road capacity.

Context

Road pricing: benefits versus adverse impacts

Are state-of-art practices and methods suitable for assessing benefits and adverse impacts of road pricing schemes?

•Is economic efficiency reached from the minimization of the net travel time?

Can social impacts be incorporated in the evaluation of road pricing schemes?

Objective

Study of the benefits and costs of road pricing projects

Assess its effects on the whole society including congestion, energy sustainability and environment

rather than concerning travel time only

•Evaluate the social impact of the current road pricing practice for congestion relief purpose

Method

Supply and demand data •Fixed OD matrix

•Net characteristics, (free flow speeds and

link capacities)

Cost functions and assignment methods

Assignment types

Computation of the traffic assignments

•UE and UO•BPR

•Total Travel Time•Social Cost

Method

Supply and demand data •Fixed OD matrix

•Net characteristics, (free flow speeds and

link capacities)

Cost functions and assignment methods

Assignment types

Computation of the traffic assignments

•User optimum•System Optimum

•Social User Optimum

•Social System Optimum

•Total Travel Time•Social Cost

Cost functions & traffic assignment methods

Assignment type

Description Accomplished by UE assignment with

User Optimum(UE)

Minimising own travel time (cost) by every traveller

Perceived cost (time) e.g.

System Optimum(UO)

Minimising total travel time network-wide

Marginal cost e.g.

Social User Optimum

(SE)

Equal social cost by all users Social cost:user costs+externalities

Social System Optimum

(SO)

Minimising total social cost Social marginal cost (can be derived from social cost)

Cftt 110

Cftt 10

...

vcncapcacopcttcsc

Method

Cost functions & traffic assignment methods

Assignment type

Description Accomplished by UE assignment with

User Optimum Minimising own travel time (cost) by every traveller

Perceived cost (time) e.g.

System Optimum Minimising total travel time network-wide

Marginal cost e.g.

Social User Optimum

Equal social cost by all users Social cost:user costs+externalities

Social System Optimum

Minimising total social cost Social marginal cost (can be derived from social cost)

Cftt 110

Cftt 10

...

vcncapcacopcttcsc

Method

sc (social cost) = ttc (travel time cost) + opc (operating cost) + ac (accident cost) + apc (air pollution cost) + nc (noise cost) + vc (vibration cost) + …

How can we put the social cost components together?

flow

Time

flow

accident

flow

fuel

flow

noise

* Money is the only way to compare dissimilar items

Method

Case Study

Case Study

Case Study

New Zealand

Christchurch City

Case Study

Case Study

UoC Campus and surroundings

Network – University of Canterbury and its surroundings

–131 zones consisting of 94 internal and 37 external zones –1455 nodes and 1654 links–Zone number 1 represents the University–Morning peak (8.00 am to 9.00 am) traffic flow

Case Study

The current state –reproduction of the current traffic

Case Study

4

0 36.01Cftt

57000

58000

59000

60000

61000

62000

63000

64000

65000

UE UO SE SO

Assignments

Tota

l Tra

vel T

ime

(veh

-min

s)

Case Study

13350

13400

13450

13500

13550

13600

UE UO SE SO

Assignments

Trav

el T

ime

Val

ue (C

ost)

($)

22350

22400

22450

22500

22550

22600

22650

22700

22750

22800

22850

UE UO SE SO

Assignments

Tota

l Soc

ial C

ost (

veh-

min

s)

0%

20%

40%

60%

80%

100%

UE UO SE SO

Assignments

Perc

enta

ge Noise Cost ($)Air Pollution CostAccident Cost ($)Operating Cost ($)Time Value ($)

User Optimum

Social Equilibrium

User EquilibriumSocial

Optimum22500

22550

22600

22650

22700

22750

22800

22850

59000 60000 61000 62000 63000 64000

Total Travel Time (veh-mins)

Tota

l Soc

ial C

ost (

$)Case Study

Current practices do not suit the special characteristics of road pricing analysis and evaluation:

–minimization of travel time contradictory to the nature of road pricing schemes, which are heavily based on charging users the marginal travel costs.

Conclusions

Serious concerns over technical decisions and impacts in the society.

–Road pricing benefits could not be reliabily predicted in the case study

Advantages and disavantages of applying UE, UO and SO

The implementation of road pricing (UO) results in a broader version of Braess’ Paradox in terms of social cost

Braess’ Paradox does not occur in social optimum

Conclusions

Current road pricing may bring out economically inefficient transportation system in terms of travel time value rather than travel time

Further Study–Analyses on other networks, especially more congested and bigger ones –Examination of the “second-best” road pricing policy–Cost evaluations in the context of transportation planning–Precise cost evaluation of air pollutants

* A research is currently undertaken involving the first and second best road pricing on the Christchurch City network

Conclusions