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Highway experts call for more sophisticated costs analysis

Don Wall
Highway experts call for more sophisticated costs analysis
FERROVIAL - Ferrovial, through subsidiary Cintra, recently acquired a seven-per-cent stake in Highway I-77, a highway with managed lanes located in North Carolina.

Despite the opposition of some, highways are here to stay as critical generators of economic growth and other social benefits.

But experts are calling for a more elevated level of discourse about pricing, greenhouse gas generation and congestion reduction versus induced demand to force political decision-makers to make more informed decisions on whether and how to build these essential pieces of infrastructure.

The first webinar in a seven-part series presented by Transport Futures highlighted cutting-edge dynamic-pricing technology that is enabling motorists to make minute-by-minute choices on new U.S. toll highways as well as convoluted regulatory approvals systems in some jurisdictions that even transportation professionals can’t really understand.

Session one, billed as Expanding Highways: Opportunities and Challenges in a COVID-altered World, was held Feb. 9 with presenters from Canada, the U.S, the U.K. and Spain.

“We do believe that roads create economic growth, create economic benefits in the community,” stated Ricardo Sanchez-Gomez, global head of technical services and innovation for Cintra. “Obviously the other big benefits are safe travel time and increases in productivity.”

Cintra, a division of Ferrovial, is one of the world’s leading private sector developers of transportation infrastructure. It currently manages 1,500 kilometres of toll roads in 25 concessions in the U.S., Europe, Australia, India and Colombia as well as Canada, where it owns 43 per cent of the concession company for 407 ETR.

In November, Cintra opened the US$3.6 billion I-66 Managed Lanes toll road in the state of Virginia, on the outskirts of Washington D.C. Sanchez-Gomez made the case that its private development and ownership of toll roads, with increasingly sophisticated pricing mechanisms, produces the roadways businesses need and drivers want.

Dynamic pricing on some managed lanes in the Cintra system use parametric algorithms to set prices, identifying factors to adjust express lane prices up or down when conditions exceed certain thresholds, complemented by a Real-Time Propensity Factor algorithm that looks for unusual shifts in driver choices.

Machine learning techniques include classic regression models, decision trees, random forests, clustering analysis and neural networks.

“Through dynamic pricing, prices they can be changed every five minutes,” said Sanchez-Gomez.

He said Cintra has estimated the economic impact study of its projects to be over $60 billion.

The debate, however, does not end there, said fellow panellist Elizabeth Deakin, professor emerita of city and regional planning at UC Berkeley. Failure to properly compare costs and benefits has to stop, she said, criticizing “hand waving” about air pollution and greenhouse gases.

“What I’m seeing is the conversations are getting difficult,” said Deakin. “And they’re going to get more difficult if we don’t address these issues, because they’re serious issues.

“I agree with the comment that we need to really think hard about public scrutiny. We need to think hard about how much travel time matters to us. It’s becoming increasingly an issue and we need a conversation about this. We need to think hard about pricing properly.”

Proponents may argue building a new highway will reduce congestion and thus is worth the dollars spent but their models often ignore many factors, Deakin explained. A new highway can be expected to enable new economic activity but it might induce so much new traffic that the highway system is congested again, perhaps more than before, within a few years.

“They don’t really model the feedback loops,” she said.

“If you’re developing a study of a metropolitan area, but growth is happening outside the boundaries, you may miss some of what’s happening. Sometimes models don’t feed those travel times and travel costs back into land use or trip generation or mode choice.”

While the U.K. was singled out for having an ultra-complicated modelling system for new transportation that doesn’t lend itself to common-sense decisions, Ontario’s was described as sensible and advanced.

“We’ve made a real effort to develop modelling tools that actually compare multiple modes against each other,” said Tija Dirks, an assistant deputy minister with the Ontario Ministry of Transportation.

“We’re working on a methodology to actually prioritize transit and highway projects and factor in things like the synergies and the prerequisites and what building one first might do to the effectiveness of the other.

“So we’re working on better evidence and information to provide to the decision makers in terms of what to do first, second, and third.”

The next webinar takes place on Feb. 23 and will focus on Optimizing Highways.

Follow the author on Twitter @DonWall_DCN.

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