Transport infrastructure provision and operations: Why should governments choose private–public partnership?

Recent transport sector liberalisation, as well as global economic crisis, is favouring the implementation of transport infrastructure projects through Public–Private Partnerships (PPP). However, there is a debate as to whether PPP schemes are a better option than conventional procurement. To this end, an evaluation framework is proposed, to assess which of these two alternative schemes for transport projects financing is preferable for the public. The proposed framework is complimentary to the Value for Money (VfM) approach and is based on a Multi Criteria Analysis (MCA). The first step is the estimation of the Public Sector Comparator (PSC) for the case of conventional procurement, dealing with construction, maintenance and operation costs revenues, as well as any costs associated with risks undertaken by the public. As for the PPP case, it includes any payments by the public sector and related risks costs. The MCA is then applied only if the PPP is found preferable for the public sector. The latter considers additional impacts, including among others the social attributes of a particular scheme, job creation, environmental impacts and safety and security aspects. The proposed framework was applied to a pilot Bus Rapid Transit (BRT) corridor infrastructure project in the city of Indore, India, in order to demonstrate its validity. The framework and its application could provide useful guidance when considering PPP for a transport project, since it demonstrates in a transparent way the society's attitude towards this project, something that is critical to its acceptance.     

Methodology for calculating passenger capacity in bus rapid transit systems: Application to the TransMilenio system in Bogotá, Colombia

Transit textbooks and engineering manuals indicate that the capacity of Bus Rapid Transit –BRT – systems does not exceed 20,000 passengers per hour per direction. The implementation of the TransMilenio BRT System, in Bogotá, Colombia, showed that the systematic combination of multiple platforms at stations, overtaking lanes, level boarding, prepayment, large buses with multiple doors, express and local services, and traffic engineering measures at intersections, allow for very large passenger throughput. Measurements indicate actual throughput of 43,000 passengers per hour per direction with average bus occupancy of 150 passengers per articulated bus, and a commercial speed of 22–24 km/h. According to special formulas developed for the analysis of high capacity BRT corridors, the critical section of TransMilenio has a practical capacity of 48,000 passengers per hour per direction with its existing infrastructure and 150 passengers per bus – 35,000 passengers per hour per direction with 110 passengers per bus. Changes in existing infrastructure, such as additional platforms, higher capacity vehicles, non-grade facilities at critical intersections, among other improvements, may increase the capacity, speed, reliability and quality of service of the system.     

Tips and Pitfalls in PPP design

The Public-Private-Partnership (PPP) procedure is a very appealing model, but as it becomes more and more used in practice, problems and failures have been observed in the management of many projects. Many of these unfortunate experiences are consequences of errors in the implementation of the procedure, but in other cases, clear errors of conception were the cause.Indeed, there are many ways to structure a PPP and PPP is not the only way to manage an infrastructure scheme. It is thus an important task to provide guidelines on whether to use PPP or other types of procurement and, in case a PPP is preferred, on how to design it. The aim of this chapter is to contribute to this task, trying to combine theoretical knowledge and practical experience.After a review of the variety of economic characteristics of transport infrastructure and their procurement conditions, we recall the reasons that may justify this association of public and private management which is the characteristic of PPP, outlining the limits of using pure private or pure public procurement. Then an analytic process is proposed, screening the parameters which matter most for choosing the PPP procedure among many possible ones, depending on the specificities of the various transport modes. This process gives also indications on key elements for implementing a PPP.Finally, the analytic process proposed is used for a generic analysis of, respectively, the motorways and port sectors, so as to test its practicability and customizing capability for the use of public authorities.     

Evaluation of progress in contractual terms: Two case studies of recent DBFO PPP projects in North America

With continuous demand for transportation infrastructure and chronic funding shortfalls, public-private partnerships (PPPs) for infrastructure provision have garnered attention in recent years in the U.S. and abroad. High profile concession deals in Chicago and Indiana have raised concerns about the protection of public interests in PPPs. Such concerns have ignited heated debates, partly driven by ideology and vested interests, but also by questionable decisions made previously. While public agencies at all levels are interested in identifying successful PPP arrangements, the variety and complexity of PPP deals, combined with local factors unique to each project, make the development of a universal evaluation framework practically infeasible.     

The cost of second best pricing and the value of risk premium

Private provision of public infrastructure (PPP) is meant to give incentives to increased efficiency in construction as well in operation and maintenance of the infrastructure e.g. within the transport sector. Efficiency is not only (private) economic efficiency, but also social efficiency e.g. social marginal cost pricing of use of the infrastructure.Is it possible to design contracts concerning payment mechanisms and financial instruments for transport infrastructure that will stimulate social efficiency and optimal allocation of risks between parties? The paper discusses whether different targets can be met and whether compromises may lead to acceptable second best solutions.PPP implies an opportunity to let the user-payment give desired incentives in the form of Social Marginal Cost Pricing (SMCP). A PPP project is a set of contracts and agreements between several parties, including the Government, the private contractor, subcontractors, banks and infrastructure users. These contracts should be designed to give the right incentives to the parties to achieve optimal risk allocation and utilising of resources.Long contract-periods are a common feature of PPPs. The paper examines the way that financial solutions should be designed to achieve the goals for the PPP-projects concerning economic and social efficiency. The expected size and variation of the income stream from the project will influence the loan conditions offered by banks concerning interest rates, guarantees and repayment and also the ability to attract investors. The balance between equity and loans again influences the conditions of the loans. An additional problem is asymmetric information between parties. The private contractor usually knows more about the task than the Government (hidden knowledge), and the Government cannot have full knowledge of the efforts of the contractor (hidden actions).     

Future challenges for transport infrastructure pricing in PPP arrangements

In this paper we report the conclusion of a research project dedicated to pricing regimes in public-private partnership contracts for the provision of transport infrastructure (Macário et al., 2009). Several elements have been brought to the bulk of knowledge that supports the design and implementation of public-private partnership in the transport sector. These developments have been achieved in the following domain:

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Understand difficulties of price setting within the PPP environment, given the potential conflict of interest among the different parties engaged, go beyond the discussion of first best versus second-best price setting mechanisms.

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Understand the role of government and regulators in the performance of a PPP.

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Translate the issue of asymmetries of information between parties into a risk taking language.

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Devise alternative contractual designs that will enable competitive price setting.

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Understand that a structural element is missing to conciliate the views of the different stakeholders over a PPP: a bridge between infrastructure costs and charges.

The objective of this paper is to overview the main challenges ahead of transport infrastructure pricing, considering the current and likely future policies as well as the field constraints. Moreover, a proposal is formulated to overcome some of the current pitfalls associated to transport infrastructure pricing.     

Bus Rapid Transit implementation in Beijing: An evaluation of performance and impacts

Bus Rapid Transit (BRT) systems are undergoing rapid development in many countries due to the unique characteristics of this form of mass transit. In China, BRT schemes are being adopted as a key strategy for relieving traffic problems. As a case-study, this paper examines the performance and impacts of BRT in Beijing, the first full-featured BRT system in China. It considers in turn the role of ITS technology in influencing the operational efficiency, technical performance and cost issues associated with BRT. Particular attention is given to the consequent impacts of BRT on travel behaviour change, traffic environment and property development. While some challenges remain, the early performance of BRT suggests that it is one of the key measures for promoting sustainable mobility.     

Does the political and economic context influence the success of a transport project? An analysis of transport public-private partnerships

The construction and provision of infrastructure services such as transport nowadays is often based on a partnership between three main actors: public sector, private sector and multilateral lenders, under a framework of Public-Private Partnerships (PPPs). This type of partnership has been employed in a wide range of projects in the transport sector and in various contexts in developing and developed countries. Given this observation, the objective of this paper is to examine how countries’ economic and political characteristics contribute to the success of PPPs in transport investments. Special focus in the analysis is given to how the perception of corruption and democratic accountability may influence the success of a PPP project in different transport sectors. We examine a database with 856 transport PPP projects using a generalized linear model in the form of a logit model in order to evaluate the transport database covering data from 72 countries, classified in six regions. The study highlights the importance of national experience. Not only does national macroeconomic experience appear to have a relevant role, but so also does its past experience (either positive or negative) of transport PPP projects. An interesting finding from the analysis is the importance of the rest of the world’s perception of a country’s level of corruption and democratic accountability for the final outcome of a PPP project.     

A simulation approach for estimating value at risk in transportation infrastructure investment decisions

Traditional economic analysis techniques used in the assessment of Public Private Partnership (PPP) projects are based upon the assumption that future cash flows are fully deterministic in nature and are not designed to account for risks involved in the assessment of future returns. In reality, many of these infrastructure projects are associated with significant risks stemming from the lack of knowledge about future cost and benefit streams. The fundamental premise of the PPP concept is to efficiently allocate risks between the public and the private partner. The return based on deterministic analysis may not depict a true picture of future economic outcomes of a PPP project for the multiple agencies involved. This deficiency underscores the importance of risk-based economic analysis for such projects. In this paper, the authors present the concept of Value-at-Risk (VaR) as a measure of effectiveness (MOE) to assess the risk share for the public and private entity in a PPP project. Bootstrap simulation is used to generate the risk profile savings in vehicle operating cost, and in travel time resulting from demand-responsive traffic. The VaR for Internal Rate of Return (IRR) is determined for public and private entity. The methodology is applied to a case study involving such a joint venture in India, the Mumbai Pune Expressway/National Highway 4 (MPEW/NH4), and fiscal implications from the perspective of the public and the private entities are examined. A comparison between deterministic and risk based economic analysis for MPEW/NH4 is presented. Risk analysis provides insightful results on the economic and financial implications from each participant's viewpoint.     

Critical issues in the design of contractual relations for transport infrastructure development

The increasing use of Public-Private Partnerships (PPP) arrangements in the provision of transport infrastructure seems to be a trend all over the world with a very particular incidence in Europe. The arguments supporting these public decisions are several and their validity varies with the different realities where these instruments are applied. The paper highlights the critical issues around the design and implementation of PPPs in the transportation sector and makes a brief presentation of the rational behind the structure of papers presented in this special issue.     

厦门快速公交系统的功能定位

结合厦门的城市规模及经济水平、居民的出行方式、城市道路条件等自身条件，对厦门快速交通系统（BRT）进行了合理的功能定位，并介绍了厦门BRT一期工程情况。实践证明，厦门BRT定位准确，对改善出行条件、缓解交通拥堵及提高出行效率起到很大作用，为破解城市交通难问题做出了有益尝试，充分体现了BRT“大容量、安全、便捷、准时、舒适”的特点。     

Workshop 2: Bus rapid transit as part of enhanced service provision

Workshop 2 focused on the role of BRT as part of enhanced public transport service provision. Discussion topics included case studies around the world; improved performance and operations; and better contracts, institutional settings and enhanced policies. BRT was identified as a vital component of modern public transport systems due to its ability to provide high performance and rapid implementation at a lower cost than comparable rail transit. The participants concluded that on top of improving trunk transit corridors, it is important to look to the first and last kilometers and the connections among transport modes. In addition, it is important to consider all dimensions, not just the technical issues. The workshop identified the desirable ingredients for BRT success, created a table of bus based options for different applications and a list of research topics.     

Impact of Transmilenio on density,land use,and land value in Bogotá

While urban sprawl has been the general growth pattern in most developing cities worldwide, the city of Bogotá has undergone a process of densification in specific areas in the past decade. Using a differences-in-differences methodology, we have shown that the bus rapid transit (BRT) network, Transmilenio, built in this period is one of the variables that account for this higher density. Areas served by Transmilenio, especially those in the periphery that have been provided with feeder bus routes, have a higher growth than zones without access to this system. Using a similar methodology for assessing the growth of newly built areas, we have not found a clear relation between the BRT and recent evolution of residential, commercial, or work areas. However, recent scientific literature confirms an impact of the BRT on land value.     

大型集装箱码头堆场装卸工艺研究

轮胎式场桥与轨道式场桥是当今大型集装箱码头堆场上采用的两种主要机型。结合具体工程从这两种设备本身以及相关的供电、土建基础设施等方面对这两种典型装卸工艺方案进行比较,以全系统的综合技术经济指标进行了方案比选。     

台湾海峡外海港口项目的建设要点

随着海峡西岸经济区开发的加快进行,福建沿海港湾资源的布局正重新整合、调整,煤炭、原油、集装箱等能源、物流基础设施建设正全面展开。尽管海峡西岸具有海域条件良好的兴化湾、湄州湾、泉州港、厦门港等港湾,但随着海运船舶的大型化,港口工程向外海发展也成为趋势。由于特殊的水域条件,在台湾海峡外海建设港口项目有着特殊的要求。结合最近几年在海峡外海按照工程总承包模式建设的几个大型原油、散货码头工程,提出工程建设的经验和体会。     

The lurch towards formalisation: Lessons from the implementation of BRT in Johannesburg,South Africa

The City of Johannesburg, South Africa, implemented the first phase of its Bus Rapid Transit (BRT) system named Rea Vaya between 2009 and 2011. The system design and organisational arrangements drew heavily on precedents from South America, especially insofar as BRT is used as an instrument for securing the transformation and formalisation of a fragmented and problematic informal public transport industry. Despite the inevitable transition problems, the formalisation scheme appears to be generally successful – an outcome that surprised many analysts as it follows a long history of mistrust, resistance, and unsuccessful interventions between government and the minibus taxi industry. The paper offers an analysis of the reasons for the successful transformation of participating taxi operators, by using a life-cycle analogy. We argue that the minibus-taxi industry in South Africa has reached a state of stasis and maturity, with limited opportunities for further growth in its present form. BRT, as it is implemented locally, offers opportunities for re-invention – for moving onto new a potential growth trajectory – by overcoming the binding constraints of informality and by opening up new markets to operators. The life-cycle analysis also offers some insights into critical success factors that, if not met in the long run, could jeopardise the longevity and scalability of the formalisation project. The paper concludes with insights regarding the planning and management of BRT systems to maximise their potential for leveraging the formalisation of informal operators, both in South Africa and in other developing countries.     

40万吨级大型矿砂船对中国港口的影响及应对策略

为积极应对淡水河谷40万吨级超大型矿砂船对中国港口行业带来的挑战,从分析中国和淡水河谷铁矿石码头发展现状入手,从硬件设施、运输系统、码头布局等方面论述40万吨级大型船舶对中国港口行业发展的影响。提出应尽快启动布局规划研究、加强运输系统调整研究、完善相关管理、寻求合作共赢等应对策略,并给出相关政策建议。     

A simulation model for gate operations in multi-purpose cargo terminals

ABSTRACT

A multi-purpose cargo terminal in a seaport contains necessary infrastructure to handle different types of cargo, such as container, dry bulk, general bulk, and Ro-Ro. Since such terminals generally have dedicated areas and equipment for different types of cargo, berth, and yard operations for each type of cargo can be considered separate. On the other hand, trucks that carry all types of cargo use the same gate structure to enter and leave the terminal. Therefore, a method to superimpose the traffic that is caused by different types of cargo is needed for the planning of gate investments and operations. Consequently, this paper has developed a simulation model for a multi-purpose terminal to estimate the gate traffic and determine the necessary gate infrastructure, so that it can be used as a decision support tool for terminal planners and operational managers.     

The regulatory function in public-private partnerships for the provision of transport infrastructure

A wide range of contractual arrangements are increasingly being used by the public sector to materialise the delegation of transport infrastructure provision tasks to the private sector, over long periods of time. This paper addresses the issue of transport infrastructure regulation in the specific context of public-private settings. Starting by the discussion on the concept of Public-Private Partnership (PPP) it is stressed that, despite the different meanings that can be found in the literature, it is possible to define a PPP by using a core group of characteristics, such as the bundling of services and the transference of a relevant part of the risks to the private sector on a long term basis. Regarding the action of the regulator, we look at three dimensions of efficiency that are expected to be pursued at the strategic level of regulatory action. However, it is acknowledged that the regulatory function is in practice rather complex since it requires balancing a multiplicity of other objectives or goals, which may vary according to specific economic conditions. In the domain of pricing, the review carried out suggests that since “first best” assumptions are not met in the “real world” it hardly seems possible that the short run marginal cost pricing “canon” could be directly used to shape pricing policies. Consequently, when considering the application of the standard neoclassical marginal cost pricing approach it is pertinent to ask whether the second best solutions can lead to efficient outcomes that might be accepted by the stakeholders. Bundling construction and maintenance tasks into a single long term contract, which is a typical characteristic of “standard” PPPs, could theoretically bring cost benefits since it allows for the possible internalization of any positive externalities that may be generated during the whole project life cycle. The economic rationale for the bundling of construction/maintenance with financing services is that it enhances the likelihood of submission of realistic bids at the procurement stage. In addition, the chances of the contractor sticking to the agreed contractual terms, after contract award, are potentially increased given the higher exposure to financial risk.     

城市快速公交（BRT）系统停靠站的适用性分析

针对快速公交（BRT）停靠站发展过程中的定位不清晰、标准不统一、衔接不顺畅等问题,基于站台线型、横向位置、纵向位置等不同的分类标准,研究了不同类型公交停靠站的特点、优缺点和适用性。