Evolution over time of heavy vehicle volume in toll roads: A dynamic panel data to identify key explanatory variables in Spain

Improving the knowledge of demand evolution over time is a key aspect in the evaluation of transport policies and in forecasting future investment needs. It becomes even more critical for the case of toll roads, which in recent decades has become an increasingly common device to fund road projects. However, literature regarding demand elasticity estimates in toll roads is sparse and leaves some important aspects to be analyzed in greater detail. In particular, previous research on traffic analysis does not often disaggregate heavy vehicle demand from the total volume, so that the specific behavioral patterns of this traffic segment are not taken into account. Furthermore, GDP is the main socioeconomic variable most commonly chosen to explain road freight traffic growth over time. This paper seeks to determine the variables that better explain the evolution of heavy vehicle demand in toll roads over time. To that end, we present a dynamic panel data methodology aimed at identifying the key socioeconomic variables that explain the behavior of road freight traffic throughout the years. The results show that, despite the usual practice, GDP may not constitute a suitable explanatory variable for heavy vehicle demand. Rather, considering only the GDP of those sectors with a high impact on transport demand, such as construction or industry, leads to more consistent results. The methodology is applied to Spanish toll roads for the 1990–2011 period. This is an interesting case in the international context, as road freight demand has experienced an even greater reduction in Spain than elsewhere, since the beginning of the economic crisis in 2008.     

Users’ perceptions and willingness to pay in interurban toll roads: identifying differences across regions from a nationwide survey in Spain

Users’ acceptability is considered one of the key drivers for the successful implementation of transport policy measures. This is especially crucial in the case of toll roads since they are financed through drivers’ contributions. Previous literature in this field has mainly focused on measuring users’ attitudes towards urban congestion pricing strategies. However limited research has been developed concerning interurban toll roads. Previous research shows that socioeconomic variables are not conclusive to explain users’ perceptions towards tolls. By contrast, other drivers such as regional differences seem to play a more important role, especially when charging conditions within the same nation greatly vary across regions. This paper analyzes regional differences in users’ attitudes within an asymmetrical distribution of the toll road network across regions. Based on a nationwide survey conducted to road users in interurban toll roads in Spain, we develop both a binomial logit and a censored regression (tobit) model to explore drivers’ perceptions and willingness to pay. The research concludes that users from regions with a more extensive tolled network generally show a more negative attitude towards charges, but not necessarily a lower willingness to pay. The paper also points out that an asymmetrical distribution of toll roads across regions may result in negative perceptions among those users perceiving to be unfairly treated when compared to citizens in other regions.     

Toll Roads in Australia: An Overview of Characteristics and Accuracy of Demand Forecasts

Abstract

A primary motivation of this paper is to draw together, in one source, information on the nature, extent and performance of Australia's evolving toll road network which is currently spread across many disparate published and unpublished sources. This paper provides key information (e.g. length, toll rates, year opened, operator(s) and payment alternatives) on all of the fully interoperable toll roads in Australia that are present in Sydney (e.g. the M2, M4, M5, etc.), Melbourne (CityLink and EastLink) and Brisbane (the Gateway Bridge, the Logan Motorway and the Gateway Extension). Where available, we compare and discuss actual traffic levels and forecasts, revealing the sizeable gap or ‘error’ in forecasts, especially during the first year of operation. Ordinary least squares regression and panel random effects regression models are developed to identify potential sources of explanation of differences in error forecasts between the Australian toll roads at various points post the opening date. A separate analysis of a sample of toll roads in the USA was also undertaken that supports the main findings from the Australian toll road network. Key influences on errors in forecasts are the capacity of a toll road, the elapsed time that the toll road has been in place, the specific period of time in which a tolled road is introduced into the network (which influences the complexity of route options including multiple tolled routes and hence toll saturation), the length of the tolled route, the presence of cash payment and the charging regime (i.e. fixed vs. distance‐based or variable user tolls).     

How much is too much for tolled road users: Toll saturation and the implications for car commuting value of travel time savings?

The current practice of forecasting the demand for new tolled roads typically assumes that car users are prepared to pay a higher toll for a shorter journey, and they will keep doing so as long as the toll cost is not higher than their current value of travel time savings. Practice ignores the possibility that there could be a point when motorists stop driving on toll roads due to a toll budget constraint. The unconstrained toll budget assumption may be valid in networks where the addition of a new toll road does not result in a binding budget constraint that car users may have for using toll roads (although it could also be invoked for existing tolled routes through a reduction in use of a tolled route). In a road network like Sydney which offers a growing number of (linked) tolled roads, the binding budget constraint may be invoked, and hence including additional toll links might in turn reduce the car users’ willingness to pay for toll roads to save the same amount of travel time. When this occurs, car users are said to reach a toll saturation point (or threshold) and begin to consider avoiding one or more toll roads. Whilst toll saturation has important implications for demand forecasting and planning of toll roads, this type of behaviour has not been explored in the literature. We investigate the influence that increasing toll outlays has on preferences of car commuters to use one or more tolled roads as the number of tolled roads increases. The Sydney metropolitan area offers a unique laboratory to test this phenomenon, with nine tolled roads currently in place and another five in planning. The evidence supports the hypothesis that the value of travel time savings decreases as a consequence of toll saturation.     

Bayesian network-based formulation and analysis for toll road utilization supported by traffic information provision

Congestion pricing has been proposed and investigated as an effective means of optimizing traffic assignment, alleviating congestion, and enhancing traffic operation efficiencies. Meanwhile, advanced traffic information dissemination systems, such as Advanced Traveler Information System (ATIS), have been developed and deployed to provide real-time, accurate, and complete network-wide traffic information to facilitate travelers’ trip plans and routing selections. Recent advances in ATIS technologies, especially telecommunication technology, allow dynamic, personalized, and multimodal traffic information to be disseminated and impact travelers’ choices of departure times, alternative routes, and travel modes in the context of congestion pricing. However, few studies were conducted to determine the impact of traffic information dissemination on toll road utilizations. In this study, the effects of the provisions of traffic information on toll road usage are investigated and analyzed based on a stated preference survey conducted in Texas. A Bayesian Network (BN)-based approach is developed to discover travelers’ opinions and preferences for toll road utilization supported by network-wide traffic information provisions. The probabilistic interdependencies among various attributes, including routing choice, departure time, traffic information dissemination mode, content, coverage, commuter demographic information, and travel patterns, are identified and their impacts on toll road usage are quantified. The results indicate that the BN model performs reasonably well in travelers’ preference classifications for toll road utilization and knowledge extraction. The BN Most Probable Explanation (MPE) measurement, probability inference and variable influence analysis results illustrate travelers using highway advisory radio and internet as their primary mode of receiving traffic information are more likely to comply with routing recommendations and use toll roads. Traffic information regarding congested roads, road hazard warnings, and accident locations is of great interest to travelers, who tend to acquire such information and use toll roads more frequently. Travel time formation for home-based trips can considerably enhance travelers’ preferences for toll road usage. Female travelers tend to seek traffic information and utilize toll roads more frequently. As expected, the information provided at both pre-trip and en-route stages can positively influence travelers’ preferences for toll road usage. The proposed methodology and research findings advance our previous study and provide insight into travelers’ behavioral tendencies concerning toll road utilization in support of traffic information dissemination.     

Private road competition and equilibrium with traffic equilibrium constraints

Toll road competition is one of the important issues under a build-operate-transfer (BOT) scheme, which is being encountered nowadays in many cities. When there are two or more competing firms and each firm operates a competitive toll road, their profits are interrelated due to the competitors' choices and demand inter-dependence in the network. In this paper we develop game-theoretic approaches to the study of the road network, on which multiple toll roads are operated by competitive private firms. The strategic interactions and market equilibria among the private firms are analyzed both in determining their supply (road capacity) and price (toll level) over the network. The toll road competition problems in general traffic equilibrium networks are formulated as an equilibrium program with equilibrium constraints or bi-level variational inequalities. Heuristic solution methods are proposed and their convergences are demonstrated with simple network examples. It is shown that private pricing and competition can be both profitable and welfare-improving.     

Electronic toll collection

Electronic toll collection (ETC) offers the opportunity for toll facility operators to supply a substantially greater amount of traffic capacity than any other currently available form of toll collection. The current interest in ETC derives from the proposals in a number of countries to introduce urban tollways, using the net toll receipts to recover the cost of the capital investment plus an acceptable profit margin for those taking the financial risk. This paper outlines the main economic, technical, and administrative features of ETC in the context of toll charges that are determined by the rules of capital cost recovery. Electronic road pricing (ERP) as a mechanism for implementing full road user charging (in line with economic principles of efficient use of road space) is not the topic of this paper, given the predominantly financial basis of setting tolls for private roads. The underlying rationale for toolroads in the political climate of most nations is not suggestive of any plan to revise the pricing regime in line with ERP upon reversion of the infrastructure to the public sector when the capital costs are repaid. It is assumed that the tollroads will revert to free roads in line with the existing road system, and that road users will continue to contribute towards the costs of maintaining the road system by the traditional pricing mechanisms (i.e. fuel taxes, vehicle registration, fees, etc.).     

Peak period tolls: Precepts and prospects

This article presents the economic rationale for road pricing and provides some scale on the magnitude of peak period tolls that might be justified. It discusses the impacts of such tolls on congestion, air quality and economic development and suggests a long term strategy towards areawide implementation of peak period pricing. It discusses current trends which are increasing the likelihood for implementation of congestion pricing and toll roads in the future. In particular, it discusses some aspects of the 1991 Intermodal Surface Transportation Efficiency Act (ISTEA) which will eliminate some of the current restraints on congestion pricing and toll highways.Abbreviations ETC Electronic toll collection - FHWA Federal Highway Administration - HOV High occupancy vehicle - ISTEA Intermodal Surface Transportation Efficiency Act - LOS Level of service - TCM Transportation control measure - V/C Volume-to-capacity ratio - VMT Vehicle mile(s) of travel - vphpl Vehicles per hour per lane     

Highway pricing and capacity choice in a road network under a build–operate–transfer scheme

It is often argued lately that the private sector should be allowed to build and operate roads in a transportation network at its own expense, in return it should receive the revenue from road toll charge within some years, and then these roads will be transferred to the government. This type of build–operate–transfer (B–O–T) projects is currently fashionable worldwide, especially for developing countries short of funds for road construction. One of the important issues concerning a highway B–O–T project is the selection of the capacity and toll charge of the new road and the evaluation of the relevant benefits to the private investor, the road users and the whole society under various market conditions. This paper deals with the selection and evaluation of a highway project under such a B–O–T scheme. For a given road network with elastic demand, mathematical models are proposed to investigate the feasibility of a candidate project and ascertain the optimal capacity and level of toll charge of the new highway. The response of road users to the new B–O–T project is explicitly considered. The characteristic of the problem is illustrated graphically with a numerical example.     

Enhanced traffic information dissemination to facilitate toll road utilization: a nested logit model of a stated preference survey in Texas

This paper investigates the effects of the provision of traffic information on toll road usage based on a stated preference survey conducted in central Texas. Although many researchers have studied congestion pricing and traffic information dissemination extensively, most of them focused on the effects that these instruments individually produce on transportation system performance. Few studies have been conducted to elaborate on the impacts of traffic information dissemination on toll road utilization. In this study, 716 individuals completed a survey to measure representative public opinions and preferences for toll road usage in support of various traffic information dissemination classified by different modes, contents, and timeliness categories. A nested logit model was developed and estimated to identify the significant attributes of traffic information dissemination, traveler commuting patterns, routing behavior, and demographic characteristics, and analyze their impacts on toll road utilization. The results revealed that the travelers using dynamic message sign systems as their primary mode of receiving traffic information are more likely to choose toll roads. The potential toll road users also indicated their desire to obtain traffic information via internet. Information regarding accident locations, road hazard warnings, and congested roads is frequently sought by travelers. Furthermore, high-quality congested road information dissemination can significantly enhance travelers’ preferences of toll road usage. Specifically the study found that travelers anticipated an average travel time saving of about 11.3 min from better information; this is about 30 % of travelers’ average one-way commuting time. The mean value of the time savings was found to be about $11.82 per hour, close to ½ of the average Austin wage rate. The model specifications and result analyses provide in-depth insights in interpreting travelers’ behavioral tendencies of toll road utilization in support of traffic information. The results are also helpful to shape and develop future transportation toll system and transportation policy.     

New models for financing and managing highways: asset-based road corporations in China

The China International Engineering Consulting Corporation undertook, in 1997, the study of Viability of Asset Based Road Corporations in China as part of the World Bank's transport sector program review. The purpose was to investigate, in a case study format, road administration in China with two specific objectives: to compare (toll) road management in different provinces and to investigate the financial viability of China's toll roads.This paper shows that the three case projects studied, each having different management structures, are all financially viable given the present financing arrangements. However, should the projects be immediately subject to market interest rates and loan maturities prevailing in China today, their financial viability would be uncertain.In a broader context, the World Bank's lending program has enabled China to experiment with different kinds of toll road management structures. These models have both advantages and disadvantages and seem to fit that province's political economic environment in which they are employed. The toll roads and, especially, the impacts of the toll road management and financing arrangements on road administration present challenges to road administration rarely faced even in the developed countries. The challenges involve questions of the congruence of public good and private interest, as well as the role of planning and public accountability – all serious questions as China moves forward in development. These questions are raised in the context of the case studies.     

A comparative analysis of US toll policy

In the US, there is a long tradition of toll roads, beginning with the Lancaster Turnpike that was built at the end of the 18th century connecting Philadelphia and Lancaster. There are currently more than 300 toll facilities in the US, which is probably the largest number of toll facilities in the world. These facilities represent a wide range of conditions, from hypercongested facilities in large metropolitan areas such as New York City to toll highways in rural areas. The toll structures are equally diverse, ranging from multi-tier price structures with frequent user, carpool, and time of day discounts; to simpler structures in which the only differentiation is made on the basis of the number of axles per vehicle. The toll rates are typically set by the agencies that operate or own the toll facilities. The rules or formulas by which these tolls are determined are not generally available to the public, though it is safe to say that toll decisions are made taking into account technical considerations, as well as the all important criterion of political acceptability. However, data on toll rates and how they change by vehicle types and by some other attributes are readily available.The overall objective of this paper is to analyze the toll data from various facilities across the US to gain insight into the overall factors affecting the tolls. A more specific objective is to assess—though in a rather approximate fashion—if the tolls by vehicle type, relative to each other, are appropriate and consistent with economic theory. This is achieved by comparing tolls to approximate indicators of road space consumption and pavement deterioration. The literature review confirmed that this is the first time such research has been conducted which is an important first step toward an analysis of the efficiency of current toll policies.The analyses in this paper are based on a random sample of all toll facilities across the US. The toll dataset, which include toll rates for passenger cars, busses, and three different truck types, is assembled mainly from the available information on the web sites of various toll agencies. After cleaning the data, the authors used econometric modeling to estimate a set of ordinary least squares (OLS) regression models that express tolls as functions of independent variables. Three families of models were estimated: linear models, models based on expansions of Taylor series, and models based on piece-wise linear approximations to non-linear effects. The resulting models were analyzed to identify the salient features of current toll policies towards different vehicle types.     

Route choice preferences: insights from Portuguese freight forwarders and truck drivers

ABSTRACT

Exploring route choice in the context of tolled alternatives can support road operators to achieve better utilization of the infrastructure, as well as maximizing revenue collection. The research presented in this paper is conducted in the context of OPTIMUM, a European Union-funded project. The research objectives include a two-component system of models that proactively calculates commercial vehicles’ toll prices. The component presented in this paper rests on the development of a route choice model that estimates the probabilities of using two alternative routes (toll road vs. national road), based on route attributes and user characteristics. To explore the usefulness of the proposed methodology a case study involving 50 truck drivers and 25 freight operators was conducted in Portugal between January 2016 and November 2017. Results from the route choice model reveal interesting insights about the role of incentives in the choice of toll roads, the perspectives of the different decision-makers and produce Values of Time for the study area.     

Profit maximization by a private toll road with cars and trucks

This paper examines the profit maximizing behavior of a private firm which operates a toll road competing against a free alternative in presence of cars and trucks. Trucks differ from cars in value of time (VOT), congestion externality, pavement damage, and link travel time function. We find that the firm takes either a car-strategy or a truck-strategy for profit maximization. For a traffic mix with relatively large car volume and small truck volume, the car-strategy results in no trucks using the toll road, while the truck-strategy results in all trucks using the toll road. We derive the equilibrium flow pattern under any combination of car-toll and truck-toll, based on which we identify a profit-maximizing frontier and a strategy-switching frontier in the car-toll and truck-toll two-dimensional space. By geometrically comparing the two frontiers, we establish general conditions under which each strategy will be taken, which suggest that the truck-to-car VOT ratio, the total traffic demand, and the difference in travel distance between the two roads are critical in shaping the firm's strategy.     

Transport infrastructure costs in low-carbon pathways

The rate and manner in which transport infrastructure (e.g. roads, railway tracks, airports) is deployed, will play an important role in determining energy demand, greenhouse gas emissions and the economic impact of the transport sector. This paper describes an exercise where the costs of infrastructure deployment for the transport sector have been incorporated into the IMACLIM-R Global E3 IAM. In addition to adding these costs, the modelling of the criteria for the deployment of infrastructure for roads has also been improved. It is found that this model recalibration results in a more accurate baseline as compared to historically observed data (2001–2013) for investments in energy demand, road infrastructure, and passenger kilometers travelled. Regarding macroeconomic effects, it is found that the imposition of a carbon emission trajectory to 2100 cause GDP to decrease relative to the newly calibrated baseline – this is a standard IAM result. However, when the deployment of infrastructure for roads and air travel is further constrained, the GDP loss is less than with a fixed carbon emission trajectory only. This is because early restriction of infrastructure for roads and air travel allows an expansion of public transport infrastructure which is adequate to meet low-carbon transport service demand whereas when less public transport infrastructure is available, more costly mitigation investments must be made in other parts of the economy. This suggests that restricting infrastructure deployment as a complementary policy to carbon pricing, lowers the cost of mitigation.     

Traffic congestion pricing methodologies and technologies

This paper reviews the methods and technologies for congestion pricing of roads. Congestion tolls can be implemented at scales ranging from individual lanes on single links to national road networks. Tolls can be differentiated by time of day, road type and vehicle characteristics, and even set in real time according to current traffic conditions. Conventional toll booths have largely given way to electronic toll collection technologies. The main technology categories are roadside-only systems employing digital photography, tag & beacon systems that use short-range microwave technology, and in-vehicle-only systems based on either satellite or cellular network communications. The best technology choice depends on the application. The rate at which congestion pricing is implemented, and its ultimate scope, will depend on what technology is used and on what other functions and services it can perform.     

State-dependent congestion pricing with reference-dependent preferences

Demand and capacity fluctuations are common for roads and other congestible facilities. With ongoing advances in pricing technology and ways of communicating information to prospective users, state-dependent congestion pricing is becoming practical. But it is still rare or nonexistent in many potential applications. One explanation is that people dislike uncertainty about how much they will pay. To explore this idea, a model of reference-dependent preferences is developed based on Köszegi and Rabin (2006). Using a facility yields an “intrinsic” utility and a “gain-loss” utility measured relative to the probability distribution over states of utility outcomes. Two types of preferences are analyzed: bundled preferences in which gains and losses are perceived for overall utility, and unbundled preferences in which gains and losses are perceived separately for the toll and other determinants of utility.Tolls are chosen to maximize total expected utility plus revenues. With bundled preferences the toll is set above the Pigouvian level when usage conditions are good, and below it when conditions are bad, in order to reduce fluctuations in utility. With unbundled preferences the direction of toll adjustment is less clear and depends on whether supply or demand is variable. For both types of preferences tolls are sensitive to the strength of gain-loss utility. If gain-loss utility is moderately strong, a state-independent toll can be optimal.     

Tolls,Terms and Public Interest in Road Concessions Privatization: A Comparative Analysis of Recent Transactions in the USA and France

Abstract

Recent concessions in France and in the USA have resulted in a dramatic difference in the valuation placed on the toll roads; the price paid by the investors in France was 12 times current cash flow whereas investors paid 60 times current cash flow for US toll roads. In this paper, we explore two questions: what accounts for the difference in these multiples? and what are the implications with respect to the public interest? Our analysis illustrates how structural and procedural decisions made by the public owner affect the concession price. Further, the terms of the concession have direct consequences that are enjoyed or borne by the various stakeholders of the toll road.     

Measuring the benefits derived from a transportation investment — a comment

Because an expansion of roads will shift the demand curves for interdependent roads, it may appear difficult to determine the consumer surplus generated by road projects. An extensive literature discusses different measures of consumer surplus, and the conditions under which the different measures give consistent answers. Little attention, however, has been given to a more fundamental problem: under what conditions does consumer surplus measure the benefits of an investment. We discuss both these issues, and explain the close relationship between the conditions guaranteeing the uniqueness of a measure of consumer welfare, and its usefulness in evaluating road projects. No uniqueness problem arises if different roads connect the same origin and destination; consumer surplus can then be measured by use of an aggregate demand curve.     

Bridge and tunnel toll elasticities in New York

In 1992, the authors carried out a statistical analysis of Triborough Bridge and Tunnel Authority (TBTA) crossings in New York City, to determine the impact of toll increases on traffic volumes and revenue. Using twelve years of monthly time-series data, we developed a set of multiple regression models that estimated traffic volumes on each TBTA bridge and tunnel as a function of the toll level and other explanatory variables. In most cases, the estimated toll elasticities were negative and much less than 1.0 in absolute value; the median toll elasticity for automobiles was found to be –0.10. Our finding that automobile travel demand is highly inelastic with respect to toll rates is consistent with most previous travel demand studies.