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Rail access charges and the competitiveness of high speed trains
Abstract
This paper examines rail access charges for high speed trains on new high speed lines in Europe and the impact these have on the market position of high speed rail. It examines the latest evidence on the marginal infrastructure and external costs of high speed rail, finding that the best evidence is that these are both not more than 2 €/train-km. However, current legislation states that environmental costs should not be charged for unless they are charged for on competing modes. Mark ups based on Ramsey pricing principles might reasonably raise prices by 100–200%, given that infrastructure charges are only a part of the final price of rail. The paper then examines the actual prices charged in the main European countries operating high speed trains and the impact these are likely to have on traffic levels and mode split. It is found that mark ups often exceed even the optimal Ramsey levels, with a significant impact on rail volumes and market share. It is concluded that, whilst it is not surprising that governments wish to recover some of the construction costs of new high speed rail lines from users, they should consider carefully whether the level of charges is actually significantly reducing traffic on and benefits from these lines.
... [6] e [21], ad esempio, esaminano i costi di accesso all'infrastruttura nei Paesi europei, mentre [22] si concentra solo su Bulgaria, e lo studio di TALEBIAN et al. [32] analizza il continente australiano. [28] esplora l'impatto dei canoni di accesso sulla competitività dei servizi AV in Europa, mentre [17] esamina i modelli di regolamentazione delle ferrovie per 20 paesi di tutto il mondo. ...
... Inoltre, la successiva fase dell'analisi utilizza la Data Envelopment Analysis cuses only on Bulgaria and [32] analyses the Australian continent. [28] explores the impacts of access charges on the competitiveness of high speed services in Europe while finally [17] (DEA) con l'obiettivo di classificare l'efficienza di diverse sezioni di linee ferroviarie italiane sulla base di selezionati parametri. Il caso di studio presentato si concentra anche sulla competizione AV lungo le linee Milano-Bologna e Bologna-Ancona, cercando di classificare le diverse sezioni di linea dal punto di vista di una IF. ...
An appropriate access charges regime represents the basis for guaranteeing fair competition in the rail sector. In accordance with the recent European and national legislations, the Italian rail infrastructure manager has lately presented a new charges scheme with a better cost orientation and deeper market segmentation based on the ability to pay. This contribution describes and compares in detail the new and the previous regimes, presenting an empirical case study on two selected Italian corridors (Milan-Bologna and Bologna-Ancona). For each OD (Origin – Destination) couple, several parameters have been defined and evaluated (with both the regimes, whether relevant). According to the particular scenario, such parameters have been selected as inputs or outputs in order to rank, by means of a decision support method (DEA - Data Envelopment Analisys), the efficiency of the rail segments taking into account the points of view of the different stakeholders, such as Infrastructure Management (IM), Railway Operators (ROs) and Transport Regulator.
In general, the outcomes show variability across scenarios and access charge schemes. In particular, based on how the scenarios were set, the results show that HS services better respond to the needs of IM or Rail Regulator while, especially with the new charges scheme, the considered ROs perspective ranks better short connections by regional trains.
Such kind of analysis could help competition and regulatory authorities or railway stakeholders to identify where and how benefits could be gained or lost and by whom.
... Track access charges can exert a controlling function in all phases of network capacity allocation (Sanchez-Borras et al., 2010). Enhanced differentiation of the charging model will mean that charges can be raised or lowered on the basis of vehicle characteristics and train path, thus linking to capacity utilization (Gibson et al., 2002;Nash et al., 2004). ...
... Track access charges can exert a controlling function in all phases of network capacity allocation. (Sanchez-Borras et al., 2010). Enhanced differentiation of the charging model will mean that charges can be raised or lowered on the basis of vehicle characteristics and train path, thus linking to capacity utilization. ...
Purpose
The purpose of this paper is to provide a theoretical conceptualization of how data envelopment analysis (DEA) can be applied to rail freight rolling stock in order to develop a tariff for track access charges which is functionally dependent upon the derived relative benchmark values of performance.
Design/methodology/approach
It is posited that track access charges should be differentiated to reflect differences in the performance of rolling stock and that this can be achieved purely on the basis of technical and other characteristics. The performance benchmarking of rolling stock is proposed as the basis for formulating and justifying a performance-based tariff structure. Using DEA, relative index measures of rolling stock performance can be derived, benchmark performance can be identified and a tariff structure can be developed.
Findings
A workable approach to implementing the concept, utilizing existing in-house databases, is found to be feasible and a template for tariff setting is established.
Research limitations/implications
In the absence of access to in-house technical data on rolling stock, which is commercially sensitive, no empirical application of the concept is possible.
Originality/value
There are many ways to improve the efficiency of a railway system. Many are inherently long term and involve significant investment. Using Sweden as an example, this paper proposes the more immediate, simpler and cheaper approach of incentivising the use of better rolling stock through appropriate track access charging. Such an approach should reduce the number of problems arising on the rail network and the costs imposed on other rail users, the infrastructure providers and society. Ultimately, the implementation of this approach would support the objective of increasing long-term robustness and reducing disruptions to railways.
... However, there are fewer papers which have analysed the implications of access charges in the competition in rail markets. The paper by Sánchez-Borrás et al. (2010) offers evidence on the marginal infrastructure and external costs of HSR services. Then, actual charges are examined for the main European countries and conclude that their levels are indeed reducing traffic on and benefits from these lines. ...
... Cost elasticities from such studies are generally low (in the range between 0.1 and 0.4). Thus marginal cost-based prices will need substantial markups even if only the full costs of maintenance and renewals are to be covered, let alone a contribution made to investment costs (see Sánchez-Borrás et al. 2010). Finally, the structure of the rail industry can affect the level of track access fees. ...
This paper develops an ex ante analysis of the introduction of on-track competition in High Speed Rail (HSR) lines. The distinctive elements of our analysis are the consideration of: (i) the vertical structure of the rail sector, (ii) operators that compete in prices and number of services, and (iii) access charges for the use of the rail infrastructure that are endogenous. We provide simulation results for three Spanish HSR routes. The socio-economic viability of entry is found to depend on whether infrastructure and rail operations are integrated or separated, and also on the policy rule to set rail access charges. Firstly, separation without entry is not an appropriate good policy: the reduction in prices is followed by a reduction in the number of services that leads to lower consumer surplus and lower industry profits. Secondly, marginal cost pricing, that would entail losses to the infrastructure manager, would make entry profitable because access charges are much lower; welfare gains would be in the range of 6–9% higher than in the pre-entry scenario. This conclusion holds for large increases in rail traffic. Thirdly, the consideration of a more realistic scenario (where the entry of a new operator would lead to a modest rise in the whole rail traffic), while encouraging entry, would imply welfare losses yet consumer surplus would go up as long as access charges are set to marginal cost pricing.
... " (atOn its face, the decision to focus reform discussions on high-speed rail is a bit puzzling, since it is not KTX but the traditional passenger (Mugunghwa and Saemaeul) and freight operations of Korail that are reported to have been losing money over the years. KTX, on the other hand, has reportedly been a successful operation that runs an operating profit (though it has not been able to pay back the costs of construction); it carries almost two-thirds of non-commuter rail passengerkilometers in South Korea and earns an operating profit for Korail despite paying an access fee to use the KR tracks reportedly of the equivalent of about 7.5 euros per train-km within the range paid by high-speed rail TOC's in Europe (Sánchez-Borràs, et al., 2010;Sánchez-Borràs and López-Pita, 2011). As shown inKorail management and its labor unions have been fighting both of the government's reform proposals, though the earlier proposal has so far attracted stronger opposition because it was subject to being dubbed " privatization " by its opponents. ...
... In general, however, governments have set access charges for high-speed trains very high, especially if the trains run on newly constructed, specialized infrastructure.Sánchez-Borràs, et al. (2010)and Sánchez-Borràs and López-Pita (2011) have estimated the marginal costs of high-speed train operation, including externalities, applied ranges of estimates for elasticities of demand, and concluded that in general European countries especially have set access charges for high-speed trains considerably above even those that would be ju ...
South Korea, like many countries, is engaged in a policy debate concerning possible railways reforms. However, unlike most countries, here the focus of discussion has been the government’s proposal to open high-speed passenger train lines to a second train company that would supply on-track competition to KTX trains. While such a policy may indeed lead to lower fares and greater efficiency, worldwide experience casts doubt on the government’s hope that it would lead to such dramatic increases in ridership that the level of subsidies to the overall rail system could be reduced. We argue that a more promising reform strategy may be to introduce competition into freight rail. Based on the Latin American experience, creating independent, vertically integrated, competing freight railway companies could be expected not only to lower shipper rates and increase efficiency but also to raise considerable revenues from the private sector in franchising fees and new investments.
... It is interesting to note that some of them have developed a methodology inspired by the Ramsey method. This solution has been investigated by several academic articles like Link andNilsson (2005), Sauvant (2008) or Sanchez-Borras et al. (2010), Broman and Eliasson (2019), Ait Ali and Eliasson (2021a) Ait Ali and Eliasson (2021b) or Börjesson et al. (2021) among others. ...
To guarantee fair and nondiscriminatory access to rail networks, European Commission raised the importance of regulation by promoting short run marginal cost. Thus, to recover the full cost of infrastructure, Infrastructure Managers may use mark ups over the marginal cost, using Ramsey pricing for example. However, a Ramsey pricing implementation for rail infrastructure is strongly limited by the lack of information about the demand elasticity of train paths. The aim of this article is to try to fill this gap by conducting an empirical research on the price sensitivity of the railway paths using a French dataset from 2003 to 2016. Preliminary results suggest that track access charges influence negatively the train path demand for high-speed trains and freight trains but do not seem to influence the train path demand for regional trains under PSO. Nevertheless, if track access charges are related to the track category (UIC category) or to the kind of line (high speed or conventional) results may differ. Regarding regional and freight trains, the track category seems to determine the statistical significance of track access charges elasticity while the kind of line seems to explain the impacts on the demand of rail paths for high-speed trains.
... Borras vd. [16] yaptıkları çalışmada, yüksek hızlı trenlerin çevre dostu bir ulaşım sağlaması ve seyahat ücretlerinin uygun aralıklarda fiyatlandırılmasından dolayı yaygın bir ulaşım türü haline geldiğini belirtmişlerdir. Ayrıca ulaşım sisteminin altyapı inşa maliyetlerinin yüksek oluşu, kademeli yatırımın mümkün olmayışı, sistemin ancak ve ancak arazinin belirlenen eğimlerde olması koşuluyla çalışabilir olması, demiryolu ulaştırma ağı tesis etmede coğrafi engellerden kaynaklanan çeşitli kısıtların olması sistemin dezavantajları olarak karşımıza çıkmaktadır [21]. ...
Türkiye de ulaşım altyapısı ve ağı kurgularken uzun yıllar demiryolu yatırımları ihmal edilmiştir. Bu durum ulaşım ağı içerisinde türel dağılımı olumsuz etkileyen sonuçlar doğurmuştur. Karayolları ağırlıklı oluşturulan planlamaların çevresel olumsuzlukları ve havayollarının hızlılık avantajına rağmen bu ulaşım türlerinin her noktaya taşımacılık hizmetinin bulunmaması, ulaşım araçlarında yenilikleri beraberinde getirmiştir. Güvenli, hızlı ve konforlu bir seyahat kapsamında geliştirilen yüksek hızlı trenler Türkiye’de yeni bir ulaşım türü olarak karşımıza çıkmaktadır. Ankara, İstanbul, Eskişehir, Konya arasında ulaşıma açılan hatların yanı sıra yapımı devam eden ve yeni oluşturulacak hatlar ile bölgeler ve şehirlerarasında hızlı, güvenli ve konforlu bir seyahat oluşturulması hedeflenmektedir. Bu çalışmada yüksek hızlı trenlerin; güvenlik, konfor, seyahat süresi, ulaşım maliyetleri gibi etkileri incelenmiştir. Mevcut hatlar arasında faaliyet gösteren ulaşım türleri kıyaslamış ve sonuç olarak yüksek hızlı trenlerin birçok etki açısından daha avantajlı ulaşım sağladığı belirlenmiştir.
... The track access charge systems for railways in Europe are highly diverse and dependent on many boundary conditions [44][45][46]. For country specific track charges we differentiate between two scenarios, based on the current network statements of the respective countries for freight 1 The data set was provided for research purposes. ...
Purpose
A fully electrified transport chain offers considerable potential for CO 2 savings. In this paper, we examine the conditions necessary to introduce a fully electrified, large-scale, high-speed rail freight transport system in Europe in addition to high-speed passenger trains, aiming to shift goods transport from road to rail. We compare a novel high-speed rail freight concept with road-based lorry transport for low-density high value goods to estimate the potential for a modal shift from road to rail in 2030.
Methods
To characterize the impacts of different framework conditions, a simulation tool was designed as a discrete choice model, based on random utility theory, with integrated performance calculation assessing the full multimodal transport chain regarding costs, emissions and time. It was applied to a European reference scenario based on forecast data for freight traffic in 2030.
Results
We show that high-speed rail freight is about 70% more expensive than the conventional lorry but emits 80% less CO 2 emissions for the baseline parameter setting. The expected mode share largely depends on the cargo’s value of time, while the implementation of a CO 2 -tax of 100 EUR/tCO 2 eq has an insignificant impact. The costs of handling goods and the infrastructure charges are highly influential variables.
Conclusion
High-speed rail track access charges are a suitable political instrument to create a level playing field between the transport modes and internalize external costs of freight transport. With the given access charge structure, a reduction of the maximum operating speed to 160 km/h has a positive impact on the expected mode share of rail transport while it still reacts positively to a wide range of the cargo’s time sensitivity (compared to a maximum operating speed of 350 km/h). The flexibility of rail freight’s operating speed is important for an effective implementation. Further research should concentrate on time- and cost-efficient transhipment terminals as they have a significant impact on transport performance.
... Показано, що останнім часом пасажири схильні користуватися послугами LCC (low-cost carrier), крім більш заселених пунктів, де зберігається перевага щодо використання HSR (high-speed railway). Для пасажирів європейських залізниць цінними є результати витрат на залізничні перевезення високошвидкісними поїздами на нових швидкісних лініях [4]. Особлива увага приділена руху поїздів при максимальному завантаженні інфраструктури і зовнішнім витратам на організацію руху на високошвидкісному залізничному транспорті. ...
Розглянуто стратегічні напрямки розвитку перевезень пасажирів залізничним транспортом в Україні та країнах світу. Приділено увагу організації руху поїздів на високошвидкісних магістралях. Для підвищення ефективності функціонування українського залізничного транспорту запропоновано визначати час відправлення поїздів з використанням теорії розкладів, що допоможе врахувати попит пасажирів на перевезення, наявність рухомого складу та ниток графіка руху для задоволення попиту.
... In general, however, governments have set access charges for high-speed trains very high, especially if the trains run on newly constructed, specialized infrastructure. Sánchez-Borràs, et al. (2010) and Sánchez-Borràs and López-Pita (2011) have estimated the marginal costs of high-speed train operation, including externalities, applied ranges of estimates for elasticities of demand, and concluded that in general European countries especially have set access charges for high-speed trains considerably above even those that would be justified by Ramsey pricing. They conjecture that governments are adopting these policies because of the high costs of high-speed rail network construction, and they raise the concern that demand may be inefficiently discouraged as a result. ...
... Borras vd. [5], çevre bilinci ve ücretlendirmenin uygunluğu gibi unsurların YHT' yi müşteri tercihlerinde ön plana çıkardığını çalışmalarında anlatmışlardır. Givaoni [6], YHT teknolojisindeki modernleşmenin müşteri tercihlerinde önemli bir unsur olduğunu vurgulamaktadır. ...
Ulaşım alanında büyük yatırımların yapıldığı ülkemizde şehirler arası ulaşım için de çeşitli projeler ortaya konulmaktadır. Köprü, viyadük, tünel ve otoyol projeleri ile kara yolu; yüksek hızlı ve hızlı tren projeleri ile şehirler arası ulaşım geliştirilmeye çalışılmaktadır. Bu çalışmada yapımı devam eden Ankara-Sivas yüksek hızlı tren (YHT) hat güzergahının değerlendirilmesini kapsamaktadır. Değerlendirmede çok kriterli karar verme yöntemlerinden analitik hiyerarşi süreci (AHS) kullanılmıştır. Mevcut ve yapılması düşünülen ulaşım projeleri ile entegrasyon, hattın geçtiği şehirler ve yakın bölge, bölgenin nüfus yoğunluğu, erişilebilirlik, yolculuk üreten önemli noktalara erişim ve hatta olan talep kriterleri ile çok yönlü bir değerlendirme yapılmıştır. Çalışmanın sonucunda hattın konumunun ve güzergahının raylı sistem ağını genişletebilecek bir noktada olması ile ilerleyen zamanda hat etkinliğinin daha da artacağı sonucuna varılmıştır.
... It has been argued that for this reason train operators should bear the full costs of the infrastructure, but where there are many operators that leaves room for some train operators to try to free ride without cooperating to reduce fixed costs, and if this is achieved by a mark-up on variable charges, it raises charges above marginal cost, leading to inefficient reductions in services which are willing to pay marginal costs. 12 Particular problems arise where innovations in signalling systems or smart monitoring transfer costs between infrastructure managers and train operators, for instance through the use of onboard monitoring systems. The most significant example of such a development is, of course, the European Train Control System, which will ultimately replace track side signals with on-board equipment. ...
This paper examines whether there are features of the structure and regulation of the British rail industry which fail to provide adequate incentives for innovation and how to overcome those found. British experience is of wider interest because Britain has gone further than any other European country to try to provide appropriate incentives through sophisticated track access charges and performance regimes and through cost- and revenue-sharing arrangements. The methodology adopted in this study started with a literature review but then followed this up with a round of interviews in Britain and a more limited round of interviews in Germany and Sweden plus reports prepared by partners on Sweden, France and Slovenia. The two main issues identified are fragmentation of the rail system, so that the organisation bearing the costs of the innovation may not receive the benefits, and short time horizons produced by franchising and regulatory arrangements. A variety of solutions have been tried in different European countries, including the holding company model, government leadership and alliances or other cost- and revenue-sharing arrangements, but all have disadvantages as well as advantages, and the best approach to take depends on circumstances such as whether there is, or could be, a single dominant operator on the network concerned.
... According to Sánchez-Borràs et al. (2010), France and Spain apply mark ups to social marginal cost, while Germany, Italy and Belgium follow an access pricing policy consisting of collecting the full financial cost minus subsidies. ...
Pricing and investment decisions are not independent; causality in the relationship cuts both ways. Optimal prices, once the investment has been made and is irreversible, are quite different compared with the situation contemplated in the ex-ante evaluation of the project, when no cost is already sunk, and various capacity options are still open. This paper deals with this critical aspect of the relationship in the planning process, when deciding on alternative transport infrastructures. Pricing affects demand and, hence, social welfare. The social profitability of the project can vary significantly depending on the pricing policy. Therefore, before deciding whether it is socially worthwhile to invest in a project, the government needs to be clear about the charging scheme that will be applied. In this paper we show that, when comparing different transport alternatives, a particular charging scheme may favor the creation of a particular transport infrastructure network, leading to irreversible long-term equilibria that would not be optimal under other charging schemes.
... Wheat and Smith (2008) report elasticity of infrastructure costs with respect to traffic volume to be in the range of about 0.2 to 0.3 in Britain and a few other countries in Europe. Sanchez-Borras et al. (2010) report around 2 Euro per train-km as a reasonable estimate of the marginal infrastructure cost (wear and tear) per train-km for high speed rail, and that this is higher than for other types of trains. ...
We consider a setting in which a rail infrastructure provider divides the track costs proportionally between the above-rail operators based on their usage. We study a proposed access charge regime aimed at incentivizing the operators to use longer train configurations. The regime sets a target length and gives a discount on an operator’s charge if it deploys a configuration of at least the target. That is, the operators may be able to reduce their access charges by deploying a longer train configuration. We analyze the policy, and conditions under which both operators have an incentive to deploy long train configurations.
... The arrival of high speed rail technology requires a comprehensive and integrated approach of government authorities and an incentive to attract investors in this sector. Strategic studies and the formulation of a general policy, as well as the prioritization of the implementation of high-speed projects, can be useful in making decisions [6]. In order to achieve sustainable economic development, proper use of the factors of production and planning is of particular importance because it increases productivity in the condition in which the country's economy is faced with limited production factors [7]. ...
A gigantic evolution has been brought about in the railway transportation by the emergence of the expressways as the most efficient method of carrying passengers within short and medium interurban distances. Various types of expressway pavements have been offered during the recent years. A considerable amount of the repair and maintenance costs in railroad sector is allocated to the constituents forming the pavements. No thorough and precise research has been so far conducted on the railroad expressways featuring traffics with speeds over 250 km/h and the extant information have merely been trivial changes in the procedures existent for speeds below 200 km/h and these are not deemed of much use and applicability. Thus, the current research paper is devoted to the investigation and selection of express railways pavement system design using VIKOR method. The evaluations indicate that the commencement of the first high-speed train work in 1964 in Japan marked a turning point in the railroad passenger transportation in the world. The development of the high-speed railway transportation is enumerated as an important revolution helping the railroads retake their crucial role in passenger transportation in such a way that it is found overtaking the roadway and aerial transportation and even exposing some airlines to real crisis. The high-speed railroad is undergoing an intensive expansion worldwide and as a safe, sound and sustainable transportation system, it has well proved its role in the social and economic development of the nations.
... The importance of the topic is recognised also by the scientific literature, which in the last years has treated the issue at different geographical scale and from different perspectives. Nash (2005) or Sanchez-Borras et al. (2010) examine the infrastructure charges and their impacts at European level while Laurino et al. (2015) review the railways regulation models for 20 countries worldwide. Nikolova (2008) focuses only on Bulgaria and Talebian et al. (2016) look at the Australian continent. ...
An appropriate access charges regime represents the basis for implementing an open market and for guaranteeing fair competition in the rail sector. In accordance with the recent European and national legislations, the Italian rail infrastructure manager has lately presented a new charges scheme with a better cost orientation and a deeper market segmentation based on the ability to pay. This paper describes and compares the new and the previous regimes, presenting a case study on selected Italian corridors. Interesting insights are added by applying a data envelopment analysis to rank the efficiency of the rail segments considering the different standpoints of three stakeholders: infrastructure manager, rail operators and rail regulator.
The results of the case study, beside showing different patterns by applying the two charges schemes, suggest that high-speed services may better respond to the needs of infrastructure manager and rail regulator while the rail operator's perspective ranks better short connections by regional trains (especially under the new regime).
This evaluation framework could help policy makers, transport authorities or railway stakeholders to identify where and how benefits could be gained or lost and by whom.
... For the Paris-Lyon HSR route in France which was opened with two stages between 1981 and 1983, the in-vehicle travel time elasticity was around −1.6 in the first stage and then reduced to −1.1 after the opening of the Northern section [86]. The in-vehicle travel time elasticity for the Madrid-Barcelona route in Spain was around −1.3 [87]. It was observed that the absolute values of direct elasticity of HSR demand with regard to travel time are significantly greater than 1; there is an inverse relationship between the elasticity values and the distance from the Italian HSR market [88]. ...
The development of high-speed rail (HSR) services throughout the last decades has gradually blurred the concept of competition and cooperation with air transportation. There is a wide range of studies on this subject, with a particular focus on single lines or smaller regions. This article synthesizes and discusses recently published studies in this area, while aiming to identify commonalities and deviations among different regions throughout the world, covering services from Europe, Asia, and North America. Our meta-analysis reveals that the literature is highly controversial and the results vary substantially from one region to another, and a generalization is difficult, given route-specific characteristics, such as demand distribution, network structure, and evolution of transportation modes. As a major contribution, we propose a list of five challenges as a future research agenda on HSR/air transport competition and cooperation. Among others, we see a need for the construction of an open-source dataset for large-scale multimodal transport systems, the comprehensive assessment of new emerging transport modes, and also taking into account the resilience of multimodal transport systems under disruption.
... However, one can consider that the increasing rail efficiency after the implementation of separation model can actually be the result of separation of accounts that is occurring at the same time. A lot of authors [5][6][7][8][9][10][11] examined the effectiveness of railway reform in the EU old member states. One of the factors the influence of which was attempted to be assessed by researchers was the separation effect on the efficiency of rail activity. ...
The objective of the article is to compare rail freight markets in Lithuania and Poland. The comparison is mainly focused on rail and road transport competition in various freight segments – oil, fertilizers, grain, coal and minerals as well as palletized cargo in both countries. The serious differences are obtained in separate freight segments. For instance oil and oil d products are so called as “rail-borne freight” in one Lithuania. The same freight segments are mainly served by roads in Poland. The pricing levels, average transportation distance, the competition within railway market are also taken into account to compare both countries. The main outcome of the article would be very valuable when Rail-Baltica project will be finished and Lithuanian and Poland rail freight market would be fully integrated.
... For different approaches on this issue see e.g. (Albalate, Bel, & Fageda, 2015;Sánchez-Borràs, Nash, Abrantes, & López-Pita, 2010) 10 According to the Implementing Regulation, a "silent train" should be composed of at least 90% of wagons complying with TSI noise norms. 11 Dust and other direct emissions can be deemed negligible, with the possible exception of underground stations. ...
European legislation implies the use of marginal social cost pricing in rail access charges levied on rail operators. Thus, they may include specific environmental charges to internalise the impacts of rail transport. However, when applying these principles in practice, several difficulties call for second-best settings adapted to the particularities of the rail market. In this context, few European railway administrations are already implementing rail access charges with an environmental dimension. This paper reviews the literature on the issue and assesses the current European experience in noise and air pollution rail charges. For this purpose, an analytical framework is built on the definition of four basic dimensions: charging approach, allocation of abatement efforts, degree of differentiation and intermodal approach. The qualitative examination of the existing systems suggests that the level of environmental surcharges can be generally increased given the low substitutability between rail and road and that the range of abatement possibilities should be enlarged by further differentiating charges. It is also found that the pricing scope should be adapted to achieve particular cost-efficient allocations of abatement efforts among rail operators and upstream agents. Finally, further research requirements for a quantitative assessment are defined.
... However, one can consider that the increasing rail efficiency after the implementation of separation model can actually be the result of separation of accounts that is occurring at the same time. Friebel et al. (2004), Beria et al. (2012), Sánchez-Borràs (2010) examined the effectiveness of railway reform in the EU old member states. One of the factors the influence of which was attempted to be assessed by researchers was the separation effect on the efficiency of rail activity. ...
In the world railways are organized in two ways. In one case, infrastructure management and organization of traffic and commercial activities are integrated at the level of one of the enterprise whereas in the other case the functions of the carrier and the manager of the infrastructure are separated. This article addresses approaches of different scientists and politicians on both forms. The analysis of the case of Lithuania has been carried out. The case of Lithuania is a typical one - historically the railways have had a monopoly with the infrastructure and transportation not separated. This article presents a critical view of theoretical pros and cons of both the models.
... A simplification is that the model only considers high-speed trains' average speed (V avg ) as the independent factor, but the other supply factors like fares, frequency and other conditions different from the average case are not considered. These other supply factors must also be considered if they differ from the average, for example in order to maximise the operator's profit or if high track access charges are part of the financial requirements (Adler et al., 2010;Sánches-Borrás et al., 2010). ...
There are examples where the design speed of new high-speed lines has been based more on performance of present technology than on optimisation of the cost-benefit outcome considering future needs. A model for optimising the design speed, or intended dimensional speed, for new high-speed lines to attain more cost-efficient planning is presented in this paper. This model, HSLdim, includes a travel demand sub-model where the dependent variable is commercial speed, and design speed dependent infrastructure cost and train operating cost sub-models, adapted for fast optimisation. Some aspects of a proposed high-speed network in Sweden have been analysed. The average speed should be as high as possible to maximise benefits. The optimal design speed for the Swedish case was found to be 325–350 km/h depending on the share of ballastless track, which has a significant influence on the construction costs. This is in line with international experience but somewhat higher than the planned design speed of 320 km/h. To summarise, the paper gives an example that analysis could increase the socio-economic output by optimising the design speed in a CBA to take future needs into consideration in new high-speed rail projects.
... (v) Reservation charges for scarce capacity, which must be paid whether the capacity is used or not. (vi) Non-discriminatory mark-ups but these must not exclude segments of traffic which could cover direct cost (Sánchez-Borràz, Nash, Abrantes, & López-Pita, 2010). Rail infrastructure is a natural monopoly and an essential facility required to provide transport services. ...
This paper examines the pricing models for the use of the railway infrastructure in some European countries. A regulatory environment shall guarantee fair access to essential facilities, specifically in presence of vertically related markets and the existence of an essential facility provided only by one firm. This paper considers two pricing models classified according different principles: the model of marginal cost and the model of full cost. Given that the effective traffic does not influence the relevant fixed costs of the networks, managers will have expected curves of marginal cost firmly under the curves of average cost, and as a result, the current trade-off between the optimal use of the network and the optimal coverage of the costs. This paper states that countries where a marginal cost model is in use, the railway system has a smaller impact on public spending.
... This has attracted increasing numbers of new passengers from air and car travel Banister, 2006, 2012;EC, 2010). Due to its increasing attractiveness, the TGV has become a complementary mode of transport to air travel, but it also competes with air travel (Sànchez-Borràs et al., 2010;Dobruszkes, 2011). The attractiveness and competitiveness of the TGV are linked to shortened distances and travel times thanks to increasingly rapid speeds (Banister, 2011) and the location of the TGV in the urban centres (Brons et al., 2009). ...
z Demiryolları konusu XIX. yüzyılın ikinci yarısından itibaren önem kazanmıştır. Türkiye'nin modernleşme tarihi açısından bakıldığında, Tanzimat Döneminde başlayan demiryolu inşasının Cumhuriyetin ilk yıllarında yoğun şekilde devam ettiği ve demiryolunun geçtiği yerler arasında sosyal, ekonomik ve politik bağlar kurduğu ve yeni merkezler meydana getirdiği görülmektedir. Günümüzde özellikle çevre faktörleri, temel ihtiyaçların karşılanmasını ve ulaşım konusunu yeniden düşünmeye itmektedir. Demiryolu taşımacılığı, daha az enerji gerektirmesi ve çevre dostu olması nedeniyle yaygın kullanılan karayolu taşımacılığı kaynaklı sorunları azaltmak için önemli bir alternatif olarak kabul edilmektedir. "İklim sorunu ile başa çıkma mücadelesinde, daha toplumcu ve daha çevreci, enerji tasarrufu sağlayan bir demiryolu bugünün sorunları için çözüm olabilir mi" sorusu çalışmanın temel savını oluşturmaktadır. Çalışma, Türkiye'deki demiryolu sistemini, tarihsel dönemeçler üzerinden anlamayı amaçlamaktadır. Sürdürülebilir bir dünya tartışmalarının yapılageldiği bir dönemde toplu ulaştırmanın yarattığı toplumsal ve çevresel etkiler üzerinde düşünmek demiryolu ulaşımını yeniden gündeme almamızı gerektirmektedir.
This paper explores the effects of cooperation between rail and air infrastructures in setting per-passenger fees prior to competition among airlines and high-speed rail (HSR) in a transport network. It is shown that, for a sufficiently low degree of substitution, cooperation results in lower fees and greater HSR traffic than under competition. Besides, it leads to more connecting passengers. An empirical application allows for a quantitative assessment of cooperation. Gains to passengers and operators are sizeable when cooperation either involves all infrastructure managers or the rail and the hub airport managers. Welfare gains are in the range of 10.4-11.1%. Our contribution offers an ex-ante analysis about the benefits of intermodal cooperation at the upstream level.
Sweden has been a front runner in vertical separation. We use data from the business long-distance corridor in Sweden to calibrate and define a demand and supply model. We simulate how the profit, welfare, fares, frequencies, modal shares and train size depend on the level of the track charges. We simulate the welfare optimal track charges, given different levels of congestion on the track, hence using the charges as a pricing instrument to allocate the train slots efficiently. We find that increases in charges have a limited impact on fares but larger impacts on the frequency. When the length of the trains can be extended and when the crowding penalty is high, the impact of higher track charges on the frequencies is larger. Higher track charges increase the length of the trains if possible. The intermodal competition from road and air has a significant impact on rail fares.
Although Chinese Railways remains largely a government owned vertically integrated system, track access charges were implemented for passenger trains in 2005 and freight trains in 2017. In recent years, many joint venture railway companies and local railway companies have been set up to bring in funding from provincial governments, state-owned enterprises and private enterprises for the construction of new lines. The coexistence of different railway enterprises and the interconnected characteristic of the railway network make the proportion of inter-rail company traffic for both passenger and freight high in China. Therefore, Chinese railways have adopted a series of revenue / cost settlement regimes reforms, including new rail access charges regimes. This paper examines these reforms, finding that the current Chinese access charges are still mainly a way to balance the accounts of rail companies. Given the revenue model of joint venture railway companies in China, the level of rail access charges is crucial for their financial performance. Moreover, the Chinese government has announced its intention of permitting open access competition, so the level and structure of track access charges will become much more important in future. Finally, this paper produces recommendations about how to reform the Chinese rail access charges regime for better adapting to the market needs in the future, in the light of European and Japanese experience.
Governments make substantial contributions to the finance of railways in Europe. This paper first considers the possible justifications for subsidies – namely normalisation of accounts, public service obligations, economies of density, relief of externalities on other modes, wider economic benefits and option values. It then considers the alternative ways of giving subsidies in the form of contributions to infrastructure costs, investment grants and subsidies to services. It concludes that there are good reasons for subsidising railways – in particular a first best argument for subsidising infrastructure will usually exist and a failure to do so will lead to fewer services being operated than are economically justified – but there is a need to ensure subsidies are used efficiently. Ways of achieving this include the setting of clear objectives and financial constraints, decentralisation of decision taking to focussed sector management, regulation and benchmarking of infrastructure costs and the introduction of competition for and in the market. Together these should reduce or eliminate the link between subsidies and inefficiency observed in earlier times.
Our study involves the decision-making problems that railway infrastructure managers face in a rail network with dedicated tracks and shared-use corridors. We will analyze the consolidation strategy for shared-use corridors, where the track serves passenger and freight trains. In the stochastic demand case, we will provide an analytical model for the railway infrastructure manager to compute the expected long-term profit using a consolidation system. We will pinpoint the different characteristics of passenger and freight trains, and analytically derive the optimum track allocation and consolidation time, together with the optimum price, in all such cases, using two different model structures, i.e., the additive and the multiplicative forms. We will extend our model further to consider the due-date requirements and volume incentives for railway operators. Our experiments will use realistic parameter values, based on the Dutch railway system.
This paper develops a cost-estimation model for building, operating, and maintaining a high-speed rail (HSR) system. The model introduces a macroscopic life cycle cost approach that encompasses HSR systems, the interactions between the subsystems, and the variability of the systems. For this reason, costs associated with HSR systems were categorized into operations, infrastructure, maintenance, and external costs, and their relationships and behaviors were modeled over their lifetime. A hypothetical HSR line was assumed to illustrate how the model behaves with respect to demand, speed, length, and the infrastructure and rolling stock types. The results show that articulated train sets provide a lower life cycle cost than nonarticulated sets, ceteris paribus. The results also indicate that the designs proposed by most manufacturers are less interesting from a life cycle cost perspective.
Reduced travel time, regional cohesion, economic development and environmental benefits were some of the reasons given to develop the High Speed network in Spain, the largest in Europe. Ever since the opening of the first High Speed line in 1992, High Speed Rail (HSR) have become a new travelling experience despite the fact that in the recent years several voices have raised concerns over a lack of demand and low occupancy rates for HS trains compared to other countries. In February 2013, RENFE implemented a new pricing scheme which reduced ticket prices by at least 11%, and introduced flexibility in their purchase in order to boost the usage of HSR. In this research, the effects of the new scheme are analyzed and the impact on the shift in the modes of transport is underpinned by considering a discrete choice model. As a consequence of this policy, occupancy rates have been hugely increased but several other findings arise from the research. Although apparently ticket price is not regarded by users as the main factor to travel by HS trains, the price elasticity of demand turns out to be high. Depending on the transport modes competing with HS the effects are quite different. For short routes connecting small and medium-size cities with big metropolitan areas the growth of demand is achieved at the expense of car and bus, whereas for long routes connecting large cities where air transport is available the growth is made mainly at the expense of air transportation, and induced demand is also triggered. Finally, when the owner of the infrastructure and the Train Operating Companies (TOC’s) are both managed by the government, the rail infrastructure fee policy set may prompt unfair competition with other modes such as the bus or the plane.
As a result of the "Speed Up" campaigns initiated in the end of last century when commercial train service averaged 48 km/h, China now has the world's longest high speed rail (HSR) network. In the past decade, China Railway High-speed (CRH) has undergone numerous technological innovation to ensure their safe, eco-friendly, and economical operation. With the privilege of involving in the construction and operation of such a large scale and long distance HSR network, researchers and engineers in the field have gained systematic and deep understanding about the dynamic system composed of train, wheels and rails, catenary and pantograph, and aerodynamic resistance. In this review paper, we summarize current research progress covering aerodynamics, catenary-pantograph interaction, dynamics and related issues of carbody, stability analysis, rail-wheel interaction, reliability of key components, and mechanisms about noise-generation. At the end, we supply our perspective about opportunities and challenges for future research and development on the mechanics of high speed rail.
Capacity pricing and allocation play important roles in efficient management of railway corridors, especially shared ones. This study analyzes how train operators would respond to different track-access charges as a first step to understanding the relationship between train operators and infrastructure managers in railway systems with some level of vertical separation. With the modeling of a corridor whose users are long-distance high-speed trains and freight trains along the entire corridor and commuter trains offering services around large urban areas in the corridor, the focus is narrowed down to each individual operator, and the factors that drive each operator's ultimate service levels are studied. Assuming an environment in which the train operators are competing for capacity, financial goals and boundary conditions of each train operator are derived, and a number of sensitivity analyses for various typical and extreme conditions are performed. This model allows forecasting the train operator's response to track-access charges and can thus help the government, regulators, and infrastructure managers in the design of appropriate capacity pricing and allocation schemes.
North American freight rail demand is projected to increase, and new passenger services are being proposed to operate simultaneously over portions of the freight infrastructure. Capacity allocation and corresponding charges have become important issues in shared-use rail lines. This study developed new approaches suitable for North American shared-use corridors with capacity models and base train equivalent concepts to estimate the possible capacity charges in congestion cost and opportunity cost. The possible access charging schemes were also assessed and compared with the current regime (infrastructure cost only). The evaluation of capacity charges demonstrates that owning railroads may bear significant congestion or opportunity cost, or both, resulting from the addition of passenger services. Opportunity cost, which represents the profit loss caused by lack of capacity and is paid by the owning railroad, is higher than the congestion cost. Therefore, capacity charges should be considered in the negotiation process between freight railroads and passenger operators. The proposed approaches facilitate the estimation of capacity charges from additional passenger trains with rational and quantitative methods. The charging schemes can assist railroads and operators in achieving a mutually satisfactory agreement.
In this paper, we derive optimal zonal prices in the Italian day-ahead electricity market using estimation of a complete system of hourly demand in 2010-2011. In Italy, the hourly equilibrium price for all buyers is computed as a uniform average of supply zonal prices, resulting from market splitting due to line congestion. We model ex-ante individual bids expressed by heterogeneous consumers, which are distinguished by geographical zones. Using empirical estimations, we compute demand elasticity values and new zonal prices, according to a Ramsey optimal scheme. This is a new approach in the wholesale electricity market literature, as previous studies have discussed the relative merit of zonal prices, considering only the issue of line congestion. Our results show that the optimal pricing scheme can improve welfare in the day-ahead Italian electricity market, with respect to both the existing uniform price scheme and the proposal to charge the existing supply zonal prices to the demand side.
The Spanish high-speed railway (HSR) network has developed swiftly over the past few years. In less than two decades, this network has already become the second longest in Europe and the third in the world ranking, and the network continues to grow. Given this situation and given that the Spanish HSR system is considered by several governments as an example to follow, the authors of this paper analyzed whether the Spanish case could be considered an example of success in terms of HSR and whether some Spanish practices could be improved on. A thorough analysis presents the Spanish HSR network in terms of its use, competitiveness with air travel, environmental and territorial impacts, and profitability and costs. The results of this analysis allowed conclusions to be drawn regarding the success of the Spanish HSR and some recommendations to be made for decision makers planning the construction of a high-speed line.
Access charges to the railway infrastructures, and in particular of the high speed lines, poses many theoretical and practical questions. Besides the need to decide whether it is better to apply a principle of marginal cost or a full cost approach, a difficulty arises with regard to the possibilities of competition between various operators. France is especially affected by this problem since access charges are particularly high while at the same time competition is non-existent. Is this absence of competition explained by the high level of access charges? After describing the principles which underlie the pricing scheme for high speed trains in France, this paper attempts to find out if these tolls constitute a barrier to entry. After building a model that summarizes the components of supply and demand on the Paris–Lyon journey, this paper shows that the considerations relating to demand (peak hour or off-peak hour) are more fundamental than access charges, which do not in themselves constitute a barrier to entry. Barriers exist, but they involve access charges in relation to the allocation of slots which would make it possible to guarantee certain profitability to a new entrant. Break-even points are proposed which show that SNCF's potential competitors have margins for manoeuvre.
This study explores the productivity of Taiwan’s freeway bus service (FBS) industry in response to competition from the Taiwan High-Speed Rail (THSR). We employ the Malmquist index to investigate the productivity of Taiwan’s FBS industry and apply the dynamic panel data (DPD) model to identify the factors influencing its productivity. The emergence of THSR initially worsened the total factor productivity of the FBS industry firstly and stimulated it in a longer time period. We also find that year 2007, sales and management expense, the total assets, and capital/asset ratio of an FBS company are the primary factors positively influencing the productivity. However, lagged 1 period Malmquist index service and service diversity reversely influence it significantly.
This paper considers the existence of a given transport infrastructure and analyzes the optimal conditions for investing in a complementary or rival new infrastructure. The model allows us to identify some key variables to be considered in cost–benefit analysis and highlights the importance of socially optimal access pricing in relation to investment decisions. The socially optimal conditions for investment depend on, among others, the cross-effects between different modes of transport, the volume of demand, the construction cost of the new infrastructure, and the restrictions faced by the regulator.
This paper explores the access charge for the use of the Italian rail infrastructure. Access problems arise when the provision of a complete service to end users requires the combination of two or more inputs, one of which is non-competitive (OECD, 2004). It is a well-known fact that excessive access charges mean higher prices for rail passengers and rail freight companies when using the infrastructure. We conclude that the structure of the access charge has changed significantly with the recent introduction of the HS/HC (high-speed and high-capacity) network; specifically, the fixed component has lost importance, whilst the variable component reaches 94%.
The impacts of the already decided increase in rail infrastructure charges in Sweden are described for various market segments within the rail transport system and on the aggregate level for society as a whole. The need for complementary measures in the road transport system is also discussed. Likewise, the paper also mentions the impact of increased rail infrastructure charges on certain significant industrial sectors. An increase in rail charges may reduce social welfare even though the reduction in rail transport mileage is small. This is mainly due to large non-internalised absolute externalities for road freight. For commuter trains, the infrastructure charges' share of the costs of rail transport is expected to rise to 13 percent, which in an international perspective still will be small.
The practice of cost-benefit analysis (CBA) has a long tradition in France, dating back to Dupuit (1849), but is still a topical subject. This practice is in fact the result of the combination of economic theory and decision processes regarding project choices. Both of these are constantly changing: advances and progress in the theory mean that the technical methods and tools used are constantly improving, while changes to decision processes and institutional organisations are transforming evaluation requirements. In some countries, the process of constant change has been very fast indeed. This is currently true in France, where major transformations are occurring. We are now leaving a period during which the doctrine was based on the strict application of…
It is sometimes argued that standard state-of-practice logit based models cannot forecast the demand for substantially reduced travel times, for instance due to High Speed Rail (HSR). The present paper investigates this issue by reviewing travel time elasticities for long-distance rail travel in the literature and comparing these with elasticities observed when new HSR lines have opened. This paper also validates the Swedish official long-distance model and its forecasted demand for a proposed new HSR track, using aggregate data revealing how the air-rail modal split varies with the difference in generalized travel time between rail and air. The official linear-in-parameters long-distance model is also compared to a model applying Box-Cox transformations. The paper contributes to the empirical literature on long-distance travel, long-distance elasticities and HSR passenger demand forecasts. Results indicate that the Swedish state-of-practice model, and similar models, is indeed able to predict the demand for a HSR reasonably well. The non-linear model, however, has better model fit and slightly higher elasticities.
In this paper, we address the issue of the allocation of railway track maintenance (wear-and-tear) costs to traffic classes. Neglecting other costs (including renewal costs), we consider a very general function relating maintenance cost C to a set of technical production characteristics K required to produce output vector T.q at input prices P.
The data base pertains to over 1500 sections of the French rail infrastructure in 1999 (Quinet, 2002), representing about 90% of the total network of 40 000 km, and provides about 10 technical characteristics and five traffic categories for each section. As input prices are assumed to be uniform in space, or constant, they disappear, as in the national cross-sectional analyses by Johansson and Nilsson (2001). Several functional forms are tested: linear, log, translog and Box-Cox. All are embedded in an unrestricted version of Khaled’s (1978) general functional specification which allows for significance tests among them and strongly establishes one of them as most appropriate for our data.
It appears that several technical characteristics, such as maximum allowed speed, power supply, type of control or number of crossings, are highly significant maintenance cost factors; also, the relation between track maintenance costs and traffic categories is nonlinear and the marginal costs of various traffic categories differ significantly, clearly following distinct “power laws”. The study also provides information on the costs of lines dedicated to freight or passenger traffic. Some implications for infrastructure charging are outlined.
The external cost of transport has been discussed in the European transport policy since the 60s. However, it was not until the mid-90s that the European Commission decided on a pricing policy for the transport sector. This policy has stimulated a wide array of new research on the external cost of transport. A survey of some of the most recent studies in the area displays a clear picture; the latest studies are clearly focused on the marginal external cost and based on detailed bottom-up methods. The paper summarise the methods used to estimate some of the components of the marginal cost of transport -marginal infrastructure cost, congestion and scarcity cost, accident and environmental cost. The survey displays the huge variation in the estimates that follows from the use of more detailed databases. While this may be perceived as a problem for blunt pricing policies the paper suggests that it highlights the need for a more refined pricing policy in the transport sector.
This policy note describes the research into the congestion costs that Railtrack (the owner and manager of the railway infrastructure in the UK) faces in operating additional trains on the rail network. This work was undertaken as part of the first periodic review of Railtrack's access charges. This is the first time that such a detailed analysis of the relationship between capacity utilisation and train performance has been undertaken on a rail network. The paper defines capacity utilisation and identifies the key drivers of congestion costs: geography, time/day of operation, relative speed and flex. The results of the congestion cost research has been reflected in the introduction of a new track access charge, known as the capacity charge. © The London School of Economics and the University of Bath 2002
Transport causes a wide range of damage to human health, ecosystems and materials. This damage should be taken into account when making decisions, i.e. it should be reflected in the prices for transport. The damagae caused by cars, planes, ships and trains should be calculated and transformed into monetary values - so called external costs. In this book we endeavour to evaluate the external costs stemming from the emissions of atmospheric pollutants caused by transport, including damage from greenhouse gases, fine particles, ozone, nitrous oxides and benzene as well as other carciogenic substances, so as to be able to calculate the external costs of a huge number of current and future modes of transport operating in different locations all over Europe. The results offer an important basis for assessing modes of transport, discussing transport taxes and charges and implementing green accounting.
Cet article constitue la mise au point et le développement d'une communication antérieure sur le même sujet [4]. Il concerne le problème posé par l'incompatibilité de la règle de vente au coût marginal préconisée par les Welfare Economics, et les conditions d'équilibre budgétaire imposées par les Pouvoirs Publics aux entreprises nationalisées. La méthode consiste en une ``maximation de Pareto'' appliquée à un modèle général dont les liaisons de structure comportent à la fois des liaisons entre les quantités et des liaisons entre les valeurs. Les résultats obtenus, rassemblés dans la section 8, sont commentés et comparés aux solutions antérieurement proposées à ce problème. Un résumé de cet article est constitué par les sections 1, 3, et 8, qui peuvent être lues sans prendre connaissance des calculs. Le modèle développé dans la section 2 a pour objet de faciliter l'interprétation donnée dans la section 3, et d'expliquer plus clairement l'intervention des prix et revenus dans les liaisons du système; mais la maximation exposée dans la section 5 est effectuée sur le modèle transformé qui, à la fin de la section 4, rassemble sous une forme condensée les liaisons du système. La section 9, enfin, à l'occasion de la critique faite de la politique ``traditionnelle'' des monopoles publics, commente certains points particuliers des résultats exposés dans la section 8.
It is European Commission policy to charge modes of transport according to the marginal social cost of their use of the infrastructure, including environmental costs. However, progress in implementing this process has been slow, partly because of the difficulty of measuring and valuing these costs. This need has led to a great deal of research in this area in recent years. The paper presents the results of some of this research, and in particular of the European Commission‐funded Unification of Accounts and Marginal Costs for Transport Efficiency (UNITE) project. UNITE used the Impact Pathway Approach developed in the ExternE project series to provide a bottom‐up methodology for the estimation and valuation of marginal social costs of transport, taking into account the diversity of circumstances in terms of location (e.g. population density, and speed and direction of winds) and time of day. The paper first explains the approach used for the measurement and valuation of environmental costs and then presents results on both total and marginal costs. It then discusses the results of a parallel project using the same methodology that estimated the marginal social cost of road use at a very disaggregate level for different vehicle types, locations, types of road and times of day for Great Britain. The results show that off the main network and outside the conurbations, private cars are currently overcharged, but elsewhere they are charged too little, particularly in the main conurbations. Buses, and even more so heavy goods vehicles, are undercharged to a greater extent. Only a kilometre‐based charging system capable of charging at different rates by vehicle type, type and location of road, and time of day is capable of reflecting all these differences; due to the development of global positioning satellite (GPS) technology, such systems are now becoming available.
This paper applies econometric methods to estimate marginal track maintenance cost in Britain - for the first time. The British case is the most radical example of rail reform in the world, and the 2005 Railway Act has resulted in a new and unique regulatory process for determining funding and service levels, where the marginal cost of changing service patterns will be a key input. Cost elasticity and marginal cost estimates are reported and compared against the results of the engineering-based approaches currently used to set variable access charges in Britain, and also against those reported for other countries. The relationship between traffic density and elasticity and marginal cost estimates is explored. The paper also discusses the potential biases introduced into elasticity and marginal cost estimates when dealing with a railway that may be out of steady state, and how to adjust for these. © 2008 LSE and the University of Bath
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