Environmental Planning Statement

Transcription

1 Operational Programmes for Malta Cohesion Policy Investing in Our Future This Project is being considered for European Union part-financing Operational Programme I Cohesion Policy Investing in Competitiveness for a Better Quality of Life Cohesion Fund Demolition of Existing Buildings and Construction of a Grade Separated Junction Triq M A Vassalli j/w Triq tas-sliema Gżira San Ġwann Msida MALTA PA/04917/09 Environmental Planning Statement Appendix Two C 30 July 2012 prepared by ERSLI Consultants Ltd on behalf of Transport Malta

2 Issue 3 30 May 2012 Ove Arup & Partners Ltd The Arup Campus Blythe Gate Blythe Valley Park Solihull West Midlands B90 8AE United Kingdom This report takes into account the particular instructions and requirements of our client. It is not intended for and should not be relied upon by any third party and no responsibility is undertaken to any third party. Job number

3 Contents 1 Introduction 1 2 Design Options 2 Page 2.1 Option A Option B 2 3 Existing Data Traffic Data Accident Data 6 4 Traffic Modelling Introduction VISSIM Microsimulation VISSIM Modelling Modelling Period and Runs Calibration Outputs 11 5 Cost Estimations Construction Costs Maintenance Costs 14 6 Benefits Estimation Time Savings Accident Data Vehicle Operating Costs Carbon Emissions 20 7 Economic Appraisal 21 8 Financial Appraisal 23 9 Sensitivity and Risk Analysis Sensitivity tests Critical variables Switching Values Risk Analysis Appraisal Summary 30 J:\210000\ \4 INTERNAL PROJECT DATA\4-05 REPORTS\KAPPARA JUNCTION\APRIL 2012\KAPPARA JUNCTION - FS - ISSUE 3 MAY 2012.DOCXJ:\210000\ \4 INTERNAL PROJECT DATA\4-05 REPORTS\KAPPARA JUNCTION\APRIL 2012\KAPPARA JUNCTION - FS - ISSUE 3 MAY 2012.DOCX

4 Appendices Appendix A Scheme drawings Appendix B VISSIM Modelling Appendix C Calculations and CBA results J:\210000\ \4 INTERNAL PROJECT DATA\4-05 REPORTS\KAPPARA JUNCTION\APRIL 2012\KAPPARA JUNCTION - FS - ISSUE 3 MAY 2012.DOCXJ:\210000\ \4 INTERNAL PROJECT DATA\4-05 REPORTS\KAPPARA JUNCTION\APRIL 2012\KAPPARA JUNCTION - FS - ISSUE 3 MAY 2012.DOCX

5 1 Introduction Arup has been commissioned by the Joint Assistance to Support Projects in European Regions () to undertake an assessment of the Kappara Junction Project in Malta. is an existing at-grade roundabout linking Triq Mikiel Anton Vassalli with Triq Tas-Sliema. The junction has 4 arms and suffers from congestion during peak periods. As a part of the TEN-T project, it is proposed to upgrade this roundabout to ease congestion. This report sets out the undertaken for 2 options for the Kappara Junction upgrade. These 2 options are described in Section 2 of this report. Section 3 provides information regarding the traffic, turning movements and accident data for the Kappara Roundabout. Section 4 describes the traffic modelling, while section 5 summarises the estimated cost for each option. Section 6 provides the benefits resulting from the proposed schemes. Section 7 summarises the findings of the economic analysis. Section 8 provides the financial analysis of the scheme. Section 9 describes the sensitivity and risk analysis undertaken for the project. J:\210000\ \4 INTERNAL PROJECT DATA\4-05 REPORTS\KAPPARA JUNCTION\APRIL 2012\KAPPARA JUNCTION - FS - ISSUE 3 MAY 2012.DOCX Page 1

6 2 Design Options Two options are presented for the upgrade of the Kappara Roundabout. The drawings associated with each option are provided in Appendix A. 2.1 Option A Option A consists of a grade separated roundabout with an overpass joining the main flow. The overpass joins the traffic in both direction of the Triq Mikiel Anton Vassalli. Slip roads are provided to allow traffic interchange between Triq Tas-Sliema and Triq Mikiel Anton Vassalli. Drawing KAPP/PL/002 of Appendix A summarises Option A. 2.2 Option B Option B consists of removing the existing roundabout and replaces it by a free flow route along Triq Mikiel Anton Vassalli. The traffic interchange between Triq Tas-Sliema and Triq Mikiel Anton Vassalli is achieved by a proposed roundabout, signalised junction, bridge, and a number of slip roads. The proposed design is provided in Appendix A. J:\210000\ \4 INTERNAL PROJECT DATA\4-05 REPORTS\KAPPARA JUNCTION\APRIL 2012\KAPPARA JUNCTION - FS - ISSUE 3 MAY 2012.DOCX Page 2

7 3 Existing Data 3.1 Traffic Data A traffic survey for Kappara Roundabout was undertaken for the AM and PM peak hours. The AM peak hour survey was conducted in July 2010, while the only available survey for the PM peak hour was from July Table 3.1 describes the four arms on the roundabout. Table 3.1: Description of arms of Kappara Roundabout Arm Arm A Arm B Arm C Arm D Description Triq Mikiel Anton Vassalli - Northbound Triq Tas-Sliema - Eastbound Triq Mikiel Anton Vassalli - Southbound Triq Tas-Sliema - Westbound The traffic survey showed that for the AM peak hour, Triq Mikiel Anton Vassalli represents the major opposing links of the roundabout as illustrated in Table 3.2. Table 3.2: Distribution of AM traffic by arm Arm Arm A Arm B Arm C Arm D Percentage of Flow 40.5% 11.9% 38.3% 9.2% Table 3.3 shows the turning movements at the roundabout for the AM peak hour. This shows that the largest movements are between Arm A and Arm C, through traffic on Triq Mikiel Anton Vassalli, with 987 vehicles going from Arm C to Arm A and 1,579 vehicles in the opposite direction during the peak hour. Table 3.3: AM peak hour turning movements Arm Arm A Arm B Arm C Arm D Arm A Arm B Arm C 1, Arm D Table 3.4 presents the turning movements at the roundabout of all the incoming flow during the AM peak hour. Table 3.4: AM peak hour turning movement percentages Arm Arm A Arm B Arm C Arm D Arm A 2.2% 19.5% 53.0% 25.3% Arm B 62.6% 2.6% 2.9% 31.9% Arm C 89.7% 1.8% 0.7% 7.8% Arm D 63.1% 14.9% 21.3% 0.7% J:\210000\ \4 INTERNAL PROJECT DATA\4-05 REPORTS\KAPPARA JUNCTION\APRIL 2012\KAPPARA JUNCTION - FS - ISSUE 3 MAY 2012.DOCX Page 3

8 Traffic survey data for the AM peak hour was provided by Transport Malta as well as the average annual daily traffic (AADT). This data was used to derive factors used to convert the AADT on each arm into an AM peak hour. These are provided in Table 3.5. Table 3.5: AM peak hour flow to AADT factors by turning movement Arm Arm A Arm B Arm C Arm D Arm A Arm B Arm C Arm D For the study in this report, it is assumed that the distribution of traffic and AM peak to AADT conversion factors shown in Tables 3.2 to 3.5 remain constant throughout the analysis. It has been assumed that traffic will increase at a rate of 1% per year. This assumption was based on advice from Transport Malta on standard growth rates currently used. Up until around 10 years ago, the standard annual traffic growth rate used by the Local Planning Authority (MEPA) when requesting Traffic Impact Statements (TIS) was 4% per annum, taken from the UK IHT s TIS guidelines. After collecting data over a period of several years from permanent traffic counters, the growth rate for Malta was established in 2002/3 as 2% per annum until 2010, dropping to 1.5% until However, in recent years it has become apparent, particularly on strategic roads, that these rates may be too high. In recent TISs, Transport Malta has accepted a 1% per annum growth rate when estimating traffic growth beyond the 5 th year of operation. Whilst traffic volume surveys are not yet available to confirm these figures, Transport Malta believe that this growth rate of 1% per annum is appropriate from their experience. Table 3.6 shows the AM peak hour traffic by arm throughout the appraisal period based on this growth assumption. Table 3.6: AM peak hour traffic by arm and year Arm Arm A 1,860 1,946 2,044 2,150 2,260 2,375 2,420 Arm B Arm C 1,760 1,831 1,926 2,024 2,126 2,235 2,278 Arm D Table 3.7 shows the PM peak hour turning movements based on the 2004 traffic count. J:\210000\ \4 INTERNAL PROJECT DATA\4-05 REPORTS\KAPPARA JUNCTION\APRIL 2012\KAPPARA JUNCTION - FS - ISSUE 3 MAY 2012.DOCX Page 4

9 Table 3.7: PM peak hour turning movements 2004 Arm Arm A Arm B Arm C Arm D Arm A , Arm B Arm C 1, Arm D A 1% traffic growth per year was applied to the traffic count in Table 3.7 to get from traffic flows in 2004 to traffic flows in 2010 (Table 3.8). The largest movements are between Arm A and Arm C, through traffic on Triq Mikiel Anton Vassalli, with 1,653 vehicles going from Arm C to Arm A and 1,314 vehicles in the opposite direction during the peak hour Table 3.8: PM peak hour turning movements 2010 Arm Arm A Arm B Arm C Arm D Arm A , Arm B Arm C 1, Arm D The traffic survey showed that for the PM peak hour, Triq Mikiel Anton Vassalli represents the major opposing links of the roundabout as illustrated in Table 3.9. Table 3.9: Distribution of PM traffic by arm Arm Arm A Arm B Arm C Arm D Percentage of Flow 51.25% 7.35% 27.58% 13.82% Table 3.10 presents the turning movements at the roundabout of all the incoming flow during the PM peak hour. Table 3.10: PM peak hour turning movement percentages Arm Arm A Arm B Arm C Arm D Arm A 1.1% 14.4% 59.0% 25.5% Arm B 59.1% 2.1% 5.5% 33.2% Arm C 87.1% 1.8% 1.0% 10.1% Arm D 46.2% 23.2% 27.7% 2.9% The AADT data was used to derive factors used to convert the AADT on each arm into an PM peak hour. These are provided in Table J:\210000\ \4 INTERNAL PROJECT DATA\4-05 REPORTS\KAPPARA JUNCTION\APRIL 2012\KAPPARA JUNCTION - FS - ISSUE 3 MAY 2012.DOCX Page 5

10 Table 3.11: PM peak hour flow to AADT factors by turning movement Arm Arm A Arm B Arm C Arm D Arm A Arm B Arm C Arm D Table 3.12 shows the PM peak hour traffic by arm throughout the appraisal period based on this growth assumption. Table 3.12: PM peak hour traffic by arm and year Arm Arm A 2,804 2,947 3,097 3,255 3,421 3,595 3,668 Arm B Arm C 1,508 1,584 1,665 1,750 1,840 1,933 1,972 Arm D Accident Data Accident data for Kappara Roundabout were provided by Transport Malta for years between 2002 and Only the 5 most recent years were used in the cost benefit analysis. The data corresponding to the accidents in years 2004 to 2008 are presented in Table Table 3.13: Numbers of accidents over the period Year Accidents Fatal Serious Slight J:\210000\ \4 INTERNAL PROJECT DATA\4-05 REPORTS\KAPPARA JUNCTION\APRIL 2012\KAPPARA JUNCTION - FS - ISSUE 3 MAY 2012.DOCX Page 6

11 4 Traffic Modelling 4.1 Introduction Time savings are one of the major benefits that need to be quantified in the cost benefit analysis. In order to compute the benefits resulting from time savings, one needs to determine the time of travel from an origin to a destination for the different appraised options. A number of options, ranging from simple calculations to software modelling, are available to determine the travel time. VISSIM microsimulation was adopted for traffic modelling of. 4.2 VISSIM Microsimulation VISSIM was selected as the modelling tool for the Kaparra Junction for its ability to capture the delays in travel time resulting from the interaction of the incoming flows on the arms with the circulation flow in the roundabout the additional distances for travel under Option B together with the effects of the proposed roundabout and signalised junction on traffic speed restrictions on the different links 4.3 VISSIM Modelling Three different models were generated for the, one corresponding to the existing roundabout, one for Option A, and one for Option B. Dynamic analysis was adopted in the modelling where the turning movements were taken to be the Origin Destination (OD) matrix. The same OD matrix was used for the 3 models. 4.4 Modelling Period and Runs The models were run for two time periods corresponding to the AM and PM peak hours. For each period, the model was run for a duration of 1.5 hours to allow 15min shoulder on both sides of the peak hour for the traffic to build up before the evaluation. The models were run with traffic flows for the years 2010, 2015, 2020, 2025, 2030, 2035, and Calibration Calibration is required to ensure that the modelling results are robust and can be used in the cost benefit analysis. The only available data for the are traffic counts conducted for the AM and PM peak hours. No other data such as queue length, or travel time are available. Therefore, the validation of the models will be based on the traffic flow. Tables 4.1 to 4.6 provide a comparison between actual and modelled flows for year They show that the modelled traffic is within 10% of the observed. This calibrates the models and therefore they will be used in the analysis. J:\210000\ \4 INTERNAL PROJECT DATA\4-05 REPORTS\KAPPARA JUNCTION\APRIL 2012\KAPPARA JUNCTION - FS - ISSUE 3 MAY 2012.DOCX Page 7

12 Table 4.1: AM peak hour flow for existing junction (actual/modelled) Arm Arm A Arm B Arm C Arm D Observed Modelled Observed Modelled Observed Modelled Observed Modelled Arm A Arm B Arm C 1,579 1, Arm D Table 4.2: AM peak hour flow for Option A (actual/modelled) Arm Arm A Arm B Arm C Arm D Observed Modelled Observed Modelled Observed Modelled Observed Modelled Arm A Arm B Arm C 1,579 1, Arm D J:\210000\ \4 INTERNAL PROJECT DATA\4-05 REPORTS\KAPPARA JUNCTION\APRIL 2012\KAPPARA JUNCTION - FS - ISSUE 3 MAY 2012.DOCX Page 8

13 Table 4.3: AM peak hour flow for Option B (actual/modelled) Arm A Arm B Arm C Arm D Arm Observed Modelled Observed Modelled Observed Modelled Observed Modelled Arm A Arm B Arm C 1,579 1, Arm D Table 4.4: PM peak hour flow for existing junction (actual/modelled) Arm Arm A Arm B Arm C Arm D Observed Modelled Observed Modelled Observed Modelled Observed Modelled Arm A ,653 1, Arm B Arm C 1,314 1, Arm D J:\210000\ \4 INTERNAL PROJECT DATA\4-05 REPORTS\KAPPARA JUNCTION\APRIL 2012\KAPPARA JUNCTION - FS - ISSUE 3 MAY 2012.DOCX Page 9

14 Table 4.5: PM peak hour flow for Option A (actual/modelled) Arm A Arm B Arm C Arm D Arm Observed Modelled Observed Modelled Observed Modelled Observed Modelled Arm A ,653 1, Arm B Arm C 1,314 1, Arm D Table 4.6: PM peak hour flow for Option B (actual/modelled) Arm A Arm B Arm C Arm D Arm Observed Modelled Observed Modelled Observed Modelled Observed Modelled Arm A ,653 1, Arm B Arm C 1,314 1, Arm D J:\210000\ \4 INTERNAL PROJECT DATA\4-05 REPORTS\KAPPARA JUNCTION\APRIL 2012\KAPPARA JUNCTION - FS - ISSUE 3 MAY 2012.DOCX Page 10

15 4.6 Outputs Travel Times calculated by VISSIM are used to quantify the time saving benefits or disbenefits. Travel Times are defined as the average travel time it takes a vehicle to move from one defined point to another. In additional to the time of travel, Travel Times include the waiting time resulting from queuing or stopping at the entry of roundabout to give way. Appendix B provides the VISSIM networks. J:\210000\ \4 INTERNAL PROJECT DATA\4-05 REPORTS\KAPPARA JUNCTION\APRIL 2012\KAPPARA JUNCTION - FS - ISSUE 3 MAY 2012.DOCX Page 11

16 5 Cost Estimations 5.1 Construction Costs A cost estimate for each of the options was made by Transport Malta in March Based on DG Regio Guidance and our experience in the preparation of application forms to the Cohesion Fund and European Regional Development Fund on behalf of other beneficiaries, the treatment of the capital costs used in economic and financial appraisal should be as follows: i. The total capital costs should be reflected in the economic appraisal, that is ineligible and well as eligible costs should be included ii. iii. iv. Contingencies should be excluded from the capital cost used to estimate the Economic Internal rate of Return and Economic Net Present Value1 VAT on eligible cost should be excluded (as this element of VAT is recoverable by Transport Malta)2. VAT on ineligible cost is included (as this element of VAT is not recoverable by Transport Malta). Table 5.1 and Table 5.2 summarise the cost breakdown. Table 5.1: Estimated construction costs for Option A and Option B in Item Option A Option B Preliminaries 351, , Site Clearance 101, , Road Restraint systems 330, , Drainage and Service Ducts 434, ,158, Earth Works 2,128, ,501, Pavement Works 1,021,148,32 1,583, Kerbs-Footpath-Paved Area 187, , Traffic Signs and Road Markings 21, , Road Lightings - CCTV 262, , Electric Works 105, , Structural Concrete 5,402, ,867, Bridge Expansion 486, , Special Structures 2,270, ,331, Blockwork and Stonework 2,873, , Shifting Cables 660, , Total (excluding VAT) 16,636, ,815, See Application Form footnote to section E Treatment of VAT in the major project applications. DG Regio Note 11 June J:\210000\ \4 INTERNAL PROJECT DATA\4-05 REPORTS\KAPPARA JUNCTION\APRIL 2012\KAPPARA JUNCTION - FS - ISSUE 3 MAY 2012.DOCX Page 12

17 18% VAT 2,994, ,566, Total Including VAT (18%) 19,631, ,382, Table 5.2: Costs summary for Option A and Option B in Description Option A Option B 1 Eligible fees excluding VAT a Design fees 150, ,000 b Construction cost 17,096, ,466, c Supervision 800, , d Land acquisition 4,564, ,661, e Publicity 25, , f Geotechnical investigation 29, , g Contingency 2,266, ,313, h VAT 4,487, ,580, Ineligible excluding VAT 507, , a VAT 91, , Total cost including VAT 30,019, ,625, Total including nonrecoverable VAT excluding contingencies 23,265, ,731, J:\210000\ \4 INTERNAL PROJECT DATA\4-05 REPORTS\KAPPARA JUNCTION\APRIL 2012\KAPPARA JUNCTION - FS - ISSUE 3 MAY 2012.DOCX Page 13

18 5.2 Maintenance Costs Maintenance costs for each option are derived based on the BCEOM study Final Report for Transport Infrastructure Projects in Malta. BCEOM distinguished between the maintenance costs for the existing roads and for newly constructed roads. In this CBA report, the total road surface area for the existing and for the proposed schemes is used to calculate the maintenance costs. The existing roundabout area is 1,800m². In Option A, the overpass will add additional road surface area of 6,000m². In Option B, the total road surface area including the scheme is 21,750m². As both options increase the surface area of road which needs to be maintained, total maintenance costs are higher with the scheme than they are currently. The maintenance strategy adopted in this study and based on the BCEOM report is as follows: For existing road o Periodic maintenance: In year 3 a wearing course overlay, followed by an overlay with scarifying in year 13, year 23, and every 10 years after o Routine maintenance: road cleaning, road marking, and culvert cleaning every year o Routine maintenance: crack sealing, and patching every year for 6% of the total road surface. In the years where overlay is undertaken, there is assumed to be no routine maintenance cost for crack sealing and patching. For new road/overpass o Periodic maintenance: 11 years then 21 years after an overlay using imported aggregate occurs. It is assumed that the first overlay takes place in year 10. o Routine maintenance: road cleaning, road marking, and culvert cleaning every year o Routine cleaning: crack sealing and patching for 1% of the total surface area of the road. In the years where overlay is undertaken, there is assumed to be no routine maintenance cost for crack sealing and patching. The cost for each item associated with road maintenance is provided in Table 5.3. Table 5.2 is adopted from the BCEOM study with costs converted to year 2010 prices 3. These costs exclude VAT. 3 Costs were converted to 2010 prices using the consumer price index for Malta taken from the IMF s World Economic Outlook database J:\210000\ \4 INTERNAL PROJECT DATA\4-05 REPORTS\KAPPARA JUNCTION\APRIL 2012\KAPPARA JUNCTION - FS - ISSUE 3 MAY 2012.DOCX Page 14

19 Table 5.3: Maintenance cost breakdown, 2010 prices (excluding VAT) Description Cost ( /m 2 ) Cleaning, road markings and signs 1.24 Crack Sealing Patching Overlay Overlay with scarifying Overlay on new road 9.64 It has been assumed that as the road becomes older, the routine maintenance costs will increase. For crack sealing and patching, the cost increases by 2% each year until an overlay is undertaken, after which the cost returns to its original level. This applies to both the Do Nothing and the Do Something scenarios. J:\210000\ \4 INTERNAL PROJECT DATA\4-05 REPORTS\KAPPARA JUNCTION\APRIL 2012\KAPPARA JUNCTION - FS - ISSUE 3 MAY 2012.DOCX Page 15

20 6 Benefits Estimation The costs of both options for Kappara Roundabout are appraised against the resulting benefits. The main benefits quantified for the purpose of this report are the benefits of time savings, benefits of accident reduction, benefits of vehicle operation costs, and benefits of carbon emission. 6.1 Time Savings Under the proposed design in Option A, traffic on Triq Mikiel Anton Vassalli going in the north and south directions will use the overpass and therefore will not go through the roundabout. This will reduce the congestion on the roundabout and therefore results in time saving for all vehicles. With this arrangement, fewer cars will be using the roundabout resulting in time saving to these vehicles, and the overpass is designed to be free flowing (according to Transport Malta) therefore the vehicles using it will not encounter any delays. Under the proposed design in Option B traffic on Triq Mikiel Anton Vassalli going in the north and south directions will not go through the roundabout. This will eliminate the congestion currently encountered on the existing roundabout. Vehicles on Triq Tas-Sliema will use the proposed roundabout, signalised intersection, bridge, and slip roads. VISSIM micro-simulation software was used to quantify the travel time per vehicle using the roundabout and the overpass. The travel time per vehicle from its origin to its destination was obtained for the different modelled years. These were linearly interpolated to find out the delays corresponding to the other years. Note that the time saving per vehicle is quantified as the difference in the travel time between the existing situation and the proposed scenario. Speed limits were imposed on the different components of the model. For Option A, a 30kph limit was imposed on the gyratory, 50kph on the approach road, and 60kph on the overpass. For Option B, a 30kph limit was imposed on the approach to the roundabout and signalised intersection, 50km on the bridge, and 60km on the main road. The values of time used in this CBA were based on the Developing Harmonised European Approaches for Transport Costing and Project Assessment (HEATCO). Table 6.1 provides the values of time and journey purpose split between work and non-work. Table 6.1: Value of time and journey purpose split, per hour, 2002 values Description Work Non-work Average Value of Time ( /hr) Journey Split 15% 85% 100% The time savings calculation is presented in Appendix C. The following assumptions should be noted: A constant traffic growth of 1% per year is applied to the 2010 AADT The split of traffic at the different arms remains the same, throughout the appraisal period, as provided in Tables 3.4 and 3.10 J:\210000\ \4 INTERNAL PROJECT DATA\4-05 REPORTS\KAPPARA JUNCTION\APRIL 2012\KAPPARA JUNCTION - FS - ISSUE 3 MAY 2012.DOCX Page 16

21 The traffic on the overpass is free flowing The journey split remains identical to the values in Table 6.1 throughout the appraisal period. It is assumed that no queuing on the overpass (Option A), and proposed Triq Mikiel Anton Vassalli road (Option B) takes place as a result of congestion elsewhere on the network The benefits have been calculated for one AM and one PM peak hour and each of these hours was then factored by 2 to reflect two AM and two PM peak hours as the most heavily trafficked periods. As traffic count data was only available for one hour in each peak period, a more accurate factor based on traffic volumes could not be calculated, but based on the consultants experience this is considered to be a reasonable assumption. Calculating benefits only for the peak hours is likely to be a conservative assumption as Transport Malta have indicated that day time traffic volumes in this area outside of the peak hours, particularly on working days, generally remain at least 50% of those in the peaks and at times this can result in pressures on the capacity of this junction. However delays would not be as great at lower traffic volumes as they are in the peaks and it has therefore been assumed that their contribution to the overall results would not be substantial and hence they have not been included in the analysis. 6.2 Accident Data The number of accidents is expected to decrease as a result of the proposed scheme. This is the direct result of the reduction of traffic flow due to the split of traffic between the different elements of the road network (roundabouts, overpass, bridge, etc ). Actual accident data, presented in Table 3.13, were used to generate a relationship between the number of accidents per year and the overall AADT of the Kappara Roundabout. The UK s Design Manual for Roads and Bridges (DMRB) suggests a relationship of the form Where A is the annual number of accidents f is a function of traffic flow and a and b are constant that varies with the type of roundabout. a should be calculated from actual accident data if they are available. For the Kappara Roundabout, the value of b is set at , while the value of a was computed from the actual accident data. The number of accidents per year for the Kappara Roundabout is estimated using the following equation: (1) 4 Based on DMRB J:\210000\ \4 INTERNAL PROJECT DATA\4-05 REPORTS\KAPPARA JUNCTION\APRIL 2012\KAPPARA JUNCTION - FS - ISSUE 3 MAY 2012.DOCX Page 17

22 For the existing Kaparra Junction, the roundabout is assumed to be in a non-built up area with speed above 40mph (UK COBA Manual). Under Option A, a different accident rate is assumed for, where the roundabout is considered in a built up area with speed up to 40 mph (UK COBA Manual). This assumption is made to reflect the reduction in the traffic volume going through the roundabout as a result of Option A proposal. In Option B, where a new roundabout and signalised junction are constructed, values for a and b have been taken from DMRB, using the values for standard roundabouts with speeds of up to 40mph, 4 arms and a dual lane approach. This gives a value for a of and for the roundabout and signalised junction respectively, and for b of and for the roundabout and signalised junction respectively Accidents on the overpass, bridge and links were also quantified using the DMRB for Option A and Option B. The number of accidents on the link is related to the million vehicle km (mvk) multiplied by a personal injury accident rate (pia). The pia/mvk for the overpass is set at Therefore, the number of accidents on the links is obtained by The cost per accident was estimated based on values per casualty avoided in the Guide to Cost-Benefit Analysis on Investment Projects (European Commission 2008). The estimated value per casualty in 2002 prices are summarised in Table 6.2. Table 6.2: Estimated values for casualties avoided (2002 prices, ) Description Fatality Serious Injury Slight Injury Estimated Value ( ) 1,445, ,500 13,700 Equation (1) and (2) were used to estimate the number of accidents per year for the existing roundabout and the proposed Do Something options over the appraisal period. Different accident severity splits were adopted per accident based on COBA Manual. The benefits representing the savings due to the accident avoided are based on the difference in the numbers of accidents per year between the existing and the Do Something scenarios. The accident savings calculation is presented in Appendix C with the following assumptions: The existing Kappara Roundabout is assumed to be a roundabout with 4 arms and dual highest link standard. The approach velocity is assumed to be above 50kph The overpass Option A), and proposed Triq Mikiel Anton Vassalli road (Option B) are considered to be a modern road with a speed limit of 60kph The accident rates are assumed to be constant throughout the appraisal period (2) J:\210000\ \4 INTERNAL PROJECT DATA\4-05 REPORTS\KAPPARA JUNCTION\APRIL 2012\KAPPARA JUNCTION - FS - ISSUE 3 MAY 2012.DOCX Page 18

23 6.3 Vehicle Operating Costs The vehicle operating costs (VOC) are based on a change in average travel speed. The VOC are split into two types, fuel and non-fuel. The fuel VOC is quantified based on the average fuel consumption. The relationship between speed (V) and fuel consumption (L) is given in the equation below Where a, b, c, and d are constant obtained from the UK s Transport Analysis Guidance (TAG) Unit Values of Time and Operation Costs 5. Table 6.3 provides the information used for the VOC benefits. Table 6.3: Fuel cost per litre (2010 prices) Description Petrol Diesel Pump Price (, 2010) VAT 18% 18% Fuel Tax 52% 42% Economic cost (, 2010) source The economic appraisal uses the resource cost of fuel, excluding the cost of fuel duty and VAT. The BCEOM study provides a split of vehicle between cars, light good vehicles (LGV), heavy good vehicle (OGV), and buses (PSV). Table 6.4 summarises this split Table 6.4: Vehicles split Vehicle Percentage Cars 90.0 LGVs 2.1 OGV1 4.6 OGV2 2.3 PSV 1.0 The non-fuel VOC is calculated using the formula C = a 1 + b 1 /V Where a 1 and b 1 are constants obtained from the UK s Transport Analysis Guidance (TAG) Unit Values of Time and Operation Costs (converted from pence to Euro cent), C is the cost per kilometre travelled and V is the average speed. Non fuel VOCs are made up of oil, tyres, maintenance depreciation and vehicle capital saving (for vehicles travelling in working time only). 5 Source: J:\210000\ \4 INTERNAL PROJECT DATA\4-05 REPORTS\KAPPARA JUNCTION\APRIL 2012\KAPPARA JUNCTION - FS - ISSUE 3 MAY 2012.DOCX Page 19

24 The benefits from the VOC are calculated based on the following assumptions The split between petrol and diesel is adopted as set out in the UK s Transport Analysis Guidance (TAG) Unit The growth in the resource cost of petrol and diesel is as set out in the UK s Transport Analysis Guidance Unit The constants used in the non-fuel VOC formula do not change over time The traffic split presented in Table 6.4 is applicable for each year of the appraisal period The VOC calculations were performed for 4 hours corresponding to 2 AM peak hours and 2 PM peak hours 6.4 Carbon Emissions The change in carbon emissions has been calculated based on the amount of fuel consumed in the existing and with project scenarios over 4 hours corresponding to 2 AM peak hours and 2 PM peak hours. Fuel consumption has been calculated as described in section 6.3 above. The amount of carbon emitted for each litre of fuel consumed has been calculated using the values given in the UK s WebTAG guidance unit Values per tonne of carbon emitted have been taken from HEATCO deliverable 5, Chapter 6. As the values for carbon in HEATCO are given in 2002 prices, these have been converted to 2010 prices using the consumer price index for Malta. Other non-greenhouse gases and noise impacts have not been assessed quantitatively as part of this appraisal. Given the small magnitude of the carbon benefits the non-greenhouse gas and noise impacts are likely to be small. Qualitatively, Option B will bring traffic closer to some houses than it is currently due to the new roundabouts whereas in Option A the traffic will affect the same houses it does currently. J:\210000\ \4 INTERNAL PROJECT DATA\4-05 REPORTS\KAPPARA JUNCTION\APRIL 2012\KAPPARA JUNCTION - FS - ISSUE 3 MAY 2012.DOCX Page 20

25 7 Economic Appraisal A cost benefit analysis was performed for the proposed schemes. The benefits are represented by the savings resulting in time, accident, vehicle operating costs and carbon emission reductions. The costs are mainly the construction costs, land costs, and the maintenance costs. The CBA analysis results are provided in Appendix C. The following points should be noted when interpreting the CBA outputs. The appraisal period is 25 years from the opening year of 2014 (final appraisal year 2038) Constant 2010 prices are used Prices are discounted to 2012 values The appraisal has been carried out incrementally using the difference between the scenarios with and without the project The value of time and estimated cost per accident was assumed to increase throughout the appraisal period in relation to the forecasted gross domestic product per capita in Malta with an elasticity of 0.7 (as recommended in HEATCO Deliverable 5). The values for GDP per capita were obtained from the International Monetary Fund (IMF). The GDP per capita growth year on year and values of time are shown in Table 7.1. No forecasts were available beyond 2015 therefore growth has been assumed to continue at the same rate beyond this year. Table 7.1: GDP per capita growth and values of time (2010 values) GDP per capita growth 0.8% 0.9% 1.2% 1.6% 1.8% 1.8% 1.8% 1.8% 1.8% 1.8% 1.8% 1.8% 1.8% 1.8% Value of time ( /hr) GDP per capita growth 1.8% 1.8% 1.8% 1.8% 1.8% 1.8% 1.8% 1.8% 1.8% 1.8% 1.8% 1.8% 1.8% 1.8% Value of time ( /hr) A discount rate of 5.5% was used in the appraisal The number of trips is assumed to be the same both with and without the project there is no generated traffic with the scheme VAT has been excluded from the economic analysis Residual values have been included for the road construction elements, which are assumed to have a 30 year life (5 years remaining at the end of the appraisal period) and for the drainage and retaining wall elements, which are assumed to have a 50 year life (25 years remaining at the end of the appraisal period) 6. All other elements are assumed to have no residual 6 Assumptions on the life are taken from HEATCO Deliverable 5. J:\210000\ \4 INTERNAL PROJECT DATA\4-05 REPORTS\KAPPARA JUNCTION\APRIL 2012\KAPPARA JUNCTION - FS - ISSUE 3 MAY 2012.DOCX Page 21

26 value, that it they have reached the end of their useful life by the end of the appraisal period. Table 7.2 summarises the CBA outputs Table 7.2: CBA summary results (values discounted to 2012) Description NPV Costs ( ) NPV Benefits ( ) NPV ( ) BCR EIRR (%) Option A 21,108,148 37,914,234 16,806, Option B 21,588,851 60,339,972 38,751, Table 7.3 presents the contribution of time savings, accident savings, and VOC to the overall benefits of each appraised option. Table 7.3: Benefits breakdown (% of total value of benefits when values discounted to 2010) Option Time Savings Accident Savings VOC Savings Carbon savings Option A 57.08% 34.12% 0.87% 0.07% Option B 81.84% 16.95% 1.10% 0.11% Both options result in additional road surface and therefore increased maintenance costs with the scheme. Table 7.3 shows that for Option A, over half of the benefits (57%) are generated from time savings, whilst accident savings make up approximately a third of the benefits. Vehicle operating costs and reductions in carbon emissions make up only a very small proportion of the benefits. For Option B, the majority of the benefits, (82%) comes from time savings. Accident savings account for further 17% of the benefits, whilst the contributions from vehicle operating costs and change in carbon emissions are limited. Both of the proposed options have good rates of return. However, Option B has the highest return on the investment at 16.5%, whilst for Option A the rate is 11.1%. Table 7.3 shows that most of the benefits, for both options, come from the time savings. These time benefits are the direct results of the time savings for the vehicles travelling along Triq Mikiel Anton Vassalli. The benefits from the vehicle operation costs and carbon emissions are limited due to the increase in the travel distances under the proposed schemes J:\210000\ \4 INTERNAL PROJECT DATA\4-05 REPORTS\KAPPARA JUNCTION\APRIL 2012\KAPPARA JUNCTION - FS - ISSUE 3 MAY 2012.DOCX Page 22

27 8 Financial Appraisal A financial appraisal was carried out for the two proposed options. As there will be no revenues generated by the project, this appraisal includes the capital costs and maintenance costs only. The appraisal contains the following assumptions: The appraisal period is 25 from the opening year of 2013 Constant 2010 prices are used Costs include VAT at 18% Residual values have been included as described in section 7 above A discount rate of 5% was used in the financial appraisal The financial appraisal results are shown in Table 8.1. Table 8.1: Results of financial appraisal (values discounted to 2010) Description FNPV ) FIRR (%) Option A -24,460, Option B -26,307, As would be expected for a non revenue generating project of this nature, the FNPV and FIRR for both options are negative. The full financial appraisal for both options is shown in Appendix C. The funding gap calculations are shown below in Table 8.2 for Option A and Table 8.3 for Option B. However, as the project is not revenue generating, in accordance with the guidelines items 9 and 10 have been ignored and the funding gap set to 100%. Table 8.2: Funding gap calculation for Option A Main Elements and Parameters Value Not discounted Value Discounted (NPV) 1 Reference period (years) 25 2 Financial discount rate (%), real 5.0% 3 Total investment cost (in current euro, not discounted) 13,726,382 4 Total investment cost (in euro, discounted) 12,450,233 5 Residual value (in euro, not discounted) 2,943,105 6 Residual value (in euro, discounted) 788,306 7 Revenues (in euro, discounted) 0 8 Operating costs (in euro, discounted) 257,410 9 Net revenue (in euro, discounted) = (7) - (8) + (6) 10 Eligible expenditure [Art 55 (2)] (in euro, discounted) = (4) - (9) 11 Funding gap rate (%) = (10) / (4) % J:\210000\ \4 INTERNAL PROJECT DATA\4-05 REPORTS\KAPPARA JUNCTION\APRIL 2012\KAPPARA JUNCTION - FS - ISSUE 3 MAY 2012.DOCX Page 23

28 Table 8.3: Funding gap calculation for Option B Main Elements and Parameters Value Not discounted Value Discounted (NPV) 1 Reference period (years) 25 2 Financial discount rate (%), real 5.0% 3 Total investment cost (in current euro, not discounted) 28,003,356 4 Total investment cost (in euro, discounted) 26,034,866 5 Residual value (in euro, not discounted) 3,514,000 6 Residual value (in euro, discounted) 941,219 7 Revenues (in euro, discounted) 0 8 Operating costs (in euro, discounted) 453,162 9 Net revenue (in euro, discounted) = (7) - (8) + (6) 10 Eligible expenditure [Art 55 (2)] (in euro, discounted) = (4) - (9) 11 Funding gap rate (%) = (10) / (4) % J:\210000\ \4 INTERNAL PROJECT DATA\4-05 REPORTS\KAPPARA JUNCTION\APRIL 2012\KAPPARA JUNCTION - FS - ISSUE 3 MAY 2012.DOCX Page 24

29 9 Sensitivity and Risk Analysis 9.1 Sensitivity tests Sensitivity tests were carried out to check the impact of changes to different aspects of the economic and financial appraisals. These tests assessed the sensitivity of the NPV and IRR to changes in: 1. Scheme costs (plus 25% or minus 5%) 2. Maintenance costs (plus or minus 10%) 3. Traffic growth assumptions (plus 5% or minus 25% on the growth rate assumed in the Base scenario) 4. Accident reduction with scheme (plus 5% or minus 25% on the accidents number) The sensitivity tests have been carried out only on the preferred option, taken to be Option B as this has the higher rate of return. The tests demonstrated that the NPV and IRR are robust as shown in Table 9.1. Table 9.1: Results of the sensitivity tests (FNPV and ENPV discounted to 2010) Variable tested FIRR 9.2 Critical variables To test whether the variables tested in the sensitivity tests were critical variables, the change in NPV in response to a 1% change in the values of the input variables was calculated. To be considered a critical variable, the NPV should change by more than 1% (based on the threshold in EC guidance). The results are shown in Table 9.2. FIRR change FNPV FNPV change Table 9.2: Critical value analysis (ENPV and FNPV discounted to 2010) Critical value test ENPV ENPV change FNPV FNPV change Capital cost +1% 38,537, % -26,568, % Maintenance costs +1% 38,743, % -26,313, % Traffic growth +1% 38,849, % -26,307, % Accident reduction with scheme +1% 38,588, % -26,307, % EIRR EIRR change ENPV Base -8.36% -26,307, % 38,751,121 ENPV change Capital cost +25% -8.46% 1% -32,816,707 25% 13.58% -18% 33,403,106-14% Capital cost -5% -8.33% 0% -25,006,247-5% 17.28% 4% 39,820, % Maintenance costs +10% -8.48% 1% -26,365, % 16.52% 0% 38,670, % Maintenance costs -10% -8.25% -1% -26,256, % 16.55% 0% 38,823, % Traffic growth +5% -8.36% 0% -26,307, % 16.62% 0% 39,241, % Traffic growth -25% -8.36% 0% -26,307, % 16.34% -1% 37,936, % Accident reduction with scheme +5% -8.36% 0% -26,307, % 16.34% -1% 37,936, % Accident reduction with scheme -25% -8.36% 0% -26,307, % 16.13% -2% 36,371, % J:\210000\ \4 INTERNAL PROJECT DATA\4-05 REPORTS\KAPPARA JUNCTION\APRIL 2012\KAPPARA JUNCTION - FS - ISSUE 3 MAY 2012.DOCX Page 25

30 On this basis, none of the variable are critical variables for the ENPV. The ENPV was most sensitive to a change in the capital costs, with a 1% change giving a 0.55% change in the ENPV. There are also no critical variables for the FNPV, which was most sensitive to a change in capital cost, with a 1% change in the capital cost resulting in a 0.99% change to the FNPV. 9.3 Switching Values No variables have been identified as being critical for the ENPV or FNPV. However, a switching value was calculated for the capital cost. The switching value is defined as the value that would have to occur for the NPV of the project to become zero. The FNPV of the scheme is million Euro (discounted to 2010) and for each 1% change in the capital cost the FNPV changes by 0.26 million Euro. Therefore for the FNPV to be equal to zero (and the project therefore to be able to cover its own costs), the capital cost would need to reduce by 100%. This is an impossible scenario. The ENPV of the scheme is 38.7 million Euro (discounted to 2010) and for each 1% change in the capital cost the FNPV changes by 0.39 million Euro. Therefore for the ENPV to be equal to zero, the capital cost would need to increase by 181.1%. This is an unlikely scenario 9.4 Risk Analysis A Monte Carlo risk analysis has been carried out for the ENPV and EIRR. The following variables shown in Table 9.3 have been identified as key change variables and used in the risk analysis. Table 9.3: Key change variables used in risk analysis Variable Minimum Maximum Capital cost -25% +5% Maintenance cost -10% +10% Traffic growth -25% +5% Accident reduction with scheme -25% +5% No correlation has been assumed between any of the variables tested. A triangular distribution has been assumed for each of the variables using the minimum and maximum values shown above. The probability distributions are based on our experience about a reasonable range of variables as there are no statistical data available. It is usual practice to use triangular probability distributions where risk is estimated by an expert or panel of experts. The simulation was run for 1,000 iterations. Probability density and cumulative probability distributions are shown for the ENPV in Figures 9.1 and 9.2 below. J:\210000\ \4 INTERNAL PROJECT DATA\4-05 REPORTS\KAPPARA JUNCTION\APRIL 2012\KAPPARA JUNCTION - FS - ISSUE 3 MAY 2012.DOCX Page 26

31 Cumulative probability Probability distribution Figure 9.1: Probability density distribution for ENPV Probability distribution for NPV NPV (million Euro) Figure 9.2: Cumulative probability distribution for ENPV 100% Cumulative probability distribution for NPV 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% NPV (Million Euro) The ENPV in the Base scenario is 38.7 million Euro (discounted to 2010). These results show that on the above assumptions, the probability that the ENPV will be negative is zero. Probability density and cumulative probability distributions are shown for the EIRR in Figures 9.3 and 9.4 below. J:\210000\ \4 INTERNAL PROJECT DATA\4-05 REPORTS\KAPPARA JUNCTION\APRIL 2012\KAPPARA JUNCTION - FS - ISSUE 3 MAY 2012.DOCX Page 27

32 Cumulative probability 14.00% 14.50% 15.00% 15.50% 16.00% 16.50% 17.00% 17.50% 18.00% Probability distribution Figure 9.3: Probability density distribution for EIRR 0.25 Probability distribution for EIRR EIRR Figure 9.4: Cumulative probability distribution for EIRR 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% Cumulative probability distribution for EIRR 0% 13.5% 14.5% 15.5% 16.5% 17.5% EIRR The EIRR in the Base scenario is 16.54%. These results show that on the above assumptions, the probability that the EIRR will be lower than the discount rate of 5.5% is zero. Summary statistics are shown in Tables 9.4 and 9.5 below. J:\210000\ \4 INTERNAL PROJECT DATA\4-05 REPORTS\KAPPARA JUNCTION\APRIL 2012\KAPPARA JUNCTION - FS - ISSUE 3 MAY 2012.DOCX Page 28

33 Table 9.4: Summary statistics for the risk analysis ENPV (mil Euro, discounted to 2010) Minimum Mean Maximum Mode Standard deviation EIRR (%) The risk analysis shows that even with pessimistic assumptions the project remains economically viable. Table 9.5: ENPV and EIRR risk analysis summary ENPV (mil Euro, discounted to 2010) 50 th percentile 5%/95% 10%/90% 25%/75% / / /39.64 EIRR (%) / / /16.66 J:\210000\ \4 INTERNAL PROJECT DATA\4-05 REPORTS\KAPPARA JUNCTION\APRIL 2012\KAPPARA JUNCTION - FS - ISSUE 3 MAY 2012.DOCX Page 29

34 10 Appraisal Summary This report presents the feasibility of the two options being considered to update the Kappara Roundabout. In Option A the roundabout would be grade separated with an overpass carrying through traffic for Triq Mikiel Anton Vassalli. In Option B the traffic interchange between Triq Tas-Sliema and Triq Mikiel Anton Vassalli is achieved by a proposed roundabout, signalised junction, bridge, and a number of slip roads. The costs of the schemes are estimated at 23.3 million Euro for Option A and 23.7 million Euro for Option B, in 2010 prices including non recoverable VAT excluding contingencies. The economic appraisal has considered the benefits of the schemes in terms of time savings, accident savings, vehicle operating cost savings and changes in carbon emissions. Both options showed a good rate of return, 11.1% for Option A and 16.5% for Option B. Option B has the higher rate of return and is considered to be the better of the two options. As the scheme is not revenue generating, the financial appraisal showed negative rates of return for the two options, and the funding gap was set at 100%. The sensitivity and risk analysis has shown that the NPV and IRR are robust and even pessimistic assumptions are highly unlikely to undermine the economic viability of the scheme. J:\210000\ \4 INTERNAL PROJECT DATA\4-05 REPORTS\KAPPARA JUNCTION\APRIL 2012\KAPPARA JUNCTION - FS - ISSUE 3 MAY 2012.DOCX Page 30

35 Appendix A Scheme drawings

36

37 30.47 A Legend Existing building Existing kerb Contract Limit New boundary wall New kerb Ramp New road paint marking Zebra crossing Proposed Crash barriers Niche Bus stop shelter Survey sheets No. 5273, 5274,5473 and H G F E D C B A Issued for MEPA Issued for Information Issued for Information E.C.F J.M.R.Z.Oct.11 E.C.F S.P.D R.Z.Sept.11 E.C.F W.P.R.Z.Jun.11 Revision Alterations Drawn Checked Approved Date Proposed Niche PROJECT No : PROJECT No. 2 PROJECT TITLE : DEMOLITION OF EXISTING BUILDINGS AND CONSTRUCTION OF OVERPASS, INCLUDING THE RE-ALIGNMENT OF EXISTING ROAD (KAPPARA JUNCTION -EA15) DRAWING TITLE : PROPOSED LAYOUT DATE : FILE No : DRAWING No : 26th October 2011 RD/448/07/6 KAPP/BO/PL/001 SHEET SIZE SCALE : REVISION : A 1 1 : 500 C CHIEF OFFICER Ing. SIMON GRIMA ARCHITECT ROBERT ZERAFA CHECKED BY J. MERCIECA DRAWN BY SHEET No: E. C. FARRUGIA 5