1 Monitoring Impacts of EU - Infrastructure Programmes Werner Rothengatter Universität Karlsruhe (TH)
2 Monitoring Impacts of EU - Infrastructure Programmes 1 Introduction 2 Transeuropean Networks 3 Strategic Assessment 4 Assessment with CBA and CGE/SDM 5 Megaprojects and their Risks 6 Financing Issues 7 Monitoring and the Role of NGOs
1 Introduction 3 1 White Paper and the TEN Revision 2004 2 European Interest versus Country Interest 3 Increasing Complexity: PPP and Concession Finance 4 Experience from Megaprojects 5 Failures in Public and Private Regimes 6 Necessity of an Independent Observatory 7 Particular Role of NGOs
2 Transeuropean Networks 4 European Policy Guide: White Paper 2001: Time to Decide 1 Shifting the balance between modes of transport 2 Eliminating bottlenecks 3 Placing the users at the heart of transport policy 4 Managing the globalisation of transport
2 TEN 5
3 TEN Strategic Assessment Criteria for Selecting the Corridors 6 1 Accessibility 2 Traffic Loads/Bottlenecks; Share of International Traffic 3 Economic Impacts (Generalised Cost, Time Savings and Cost Reductions) 4 Environmental Impacts
7 3 TEN Assess
3 TEN Assess 8
Road particulates 9 3 TEN Assess The costs caused by road congestion in a region j are estimated by following formula: Ź, Ź where Ź basic value of time from UNITE by trip purpose p Ź CF C correction factor for country C the region j and the link i belongs to Ź t s,i difference in travel time on road link i during time slice s compared to travel time under free-flow condition d s duration of time slice s within a whole year traffic volume on link i during time panel s, differentiated by vehicle type vt Ź
4 Assessment with CBA and CGE/SDM 10 Standard CBA - Benefits 1 Mandatory Impacts - - Time Savings Savings of Operation Costs - - Change of Variable Infrastructure Cost Change of Accident Costs 2 Discretionary Impacts - Environmental Impacts - Climate Change - Spatial Impacts
4 Assessment with CBA and CGE/SDM Standard CBA - Benefits 1 Problem Area I - Country-based CBA not Comparable - Ex: Lyon - Turin High Speed Project 11 2 Problem Area II - European Value is not Equal to the Sum of Country Values - National Companies don t Consider International Benefits 3 Problem Area III - Scales are not Comparable with Private Investments - Political Appraisal Bias
4 Assessment with CBA and CGE/SDM SGE/SDM 1 Computed General Equilibrium Models - Consideration of Horizontal Interdependencies - Mainstream Economic Welfare Analysis 12 2 System Dynamic Modelling - Consideration of Horizontal and Vertical Interdependencies - Modelling of Staged Policies 3 Most Important Issues - Identification of Overall Net Benefits and their Spatial Distribution - Construction of Complete Scenarios (Investment and Finance)
4 Assessment with CBA and CGE/SDM SDM 13 TEN investments in the TIPMAC BAU scenario [Mio*EURO/year] 14000 12000 10000 8000 6000 4000 2000 0 1995 1998 2001 2004 2007 2010 2013 2016 2019 Austria Belgium+Luxemburg Danmark Spain Finland France United Kingdom Germany Greece Ireland Italy Netherlands Portugal Sweden
4 Assessment with CBA and CGE/SDM SDM AS T RA M o du les a n d M ai n In ter face s Popul a tion C hang e Pot enti a l L abour For ce Popul a tion St ruc tur e POP 14 MA C GD P, ( U n -)E mploym GD P, P roduct ivity e nt, S ec tor a l Ou tput S ec tor a l Good s F lo w s R E M Expo rts, Import s F O T T ran sport Exp e nditu re, P e rform an ce, T im e Ge ne raliz e d Co st O D T ran sport De mand OD T RA T ran sport C ost, T im e OD VF T VA T R e v e nu e Fu el T ax R ev enu e GD P, E m ploym e nt,... Fu e l Pri ce Fl ee t S tru c tur e E N V WE M Abb rev iati ons : P O P = P o pul at io n M od ul e MAC = Macro e co n om ics M od ul e RE M = Reg io n a l Eco n o m ic s Mo d u le F O T = F ore ig n T ra d e M od ul e TR A = T r an sp or t Mo dul e EN V = E n v iro nm en t Mo dul e V F T = V eh icl e Fl ee t Mo dul e WE M = We lf are Meas u re m e n t M od ul e
4 Assessment with CBA and CGE/SDM SDM 15 Reactions of macroeconomic aggregates for EU15 (SMCP-Tolls scenario) 3 Change to BAU scenario [%] 2 1 0-1 -2-3 GDP Employment Consumption Investment Export Government Consumption Gross value added Total factor productivity -4 2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 2020 Year
4 Assessment with CBA and CGE/SDM SDM 16
5 Megaprojects and their Risks Examples 17 1 Channel Tunnel, Oeresund (in Operation) 2 NEAT Tunnels (under Construction) 3 Further Alpine Tunnel Projects 4 Fehmarn-Belt 5 Strait of Messina 6 Spanish Rail Interoperability
6 Financing Issues European Assistance 18 1 The Megaproject Financial Rule(FBR): - Add 50% to Cost Figures - Subtract 30% from Estimated Demand 2 Procurement Including a Company outside the Public Budget - Example of the Oeresund Project - - 30% Rule of FBR Clear Risk Allocation
6 Financing Issues European Assistance 19 3 Financial Volume for TENT: - 600 bill. in total - 225 bill. for the High Priority Projects - 140 bill. in the Period 2007-2013 - Presently available: 700 mill. per year 4 Financial Contributions - 20 % EU Funding (for Cross Border or Cross Natural Barrier Projects, up to 50% in Cross-border Sections) - Private Contributions: 20% - Rest of Funding: Member States, EIB
7 Monitoring, Role of NGOs Government Failures 20 1 Process of Procurement - Lobby Groups; Projects and Political Career - State as a Promoter - Systematic Underestimation of Costs and Overestimation of Benefits - No Interest in Ex-post Evaluation 2 Possible Change - Role of Coordinator and Protector of Social Interest as well as of the Environment - Clear Set of Performance Specifications - Quality Control. Observatory of Progress
7 Monitoring, Role of NGOs Private Failures 21 1 Process of Procurement - Lobbying for Projects, Rent Seeking Behavior - Partial Optimisation, Fragmentation of the Networks - Reinvestment in Value Adding Segments - No Interest in Strict Auditing 2 Possible Change - Public Framework for Concession Finance - Shorter Life of Concessions, Tender - Benchmarking (Yardstick Competition) - Improved Contracts (No Cost-plus Contracts)
7 Monitoring, Role of NGOs Role of NGOs 22 1 Participation in Project Procurement - Setting Performance Criteria (Economic, Social, Environmental) - Representing the Stakes of Users and Taxpayers - Protecting the Groups Exposed to Harmful Impacts 2 Participation in Quality Control and Auditing - Observatory for Project Development - Construction and Operation Phase - Benchmarking - Control of Recontracting and Tendering Processes