If the EPA Won’t Question Roading Economics, Who Will?

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Last Friday the CBT made our representation to the Waterview Board of Inquiry , which is being run by the Environmental Protection agency.

The transcript is here, and it has a quite revealing exchange with myself and Judge Newhook.

It is revealing because clearly the Environmental Protection Agency does not see it’s role to question or check whether the economic benefits of roading projects are actually realised or not. But the question is if the EPA won’t question the economics of roading projects, who will?

The BOI as I saw it was more interested in mitigating the environmental damage the project will create and taking the economics of the project as a given. It is frustrating to think that the Board may not give any consideration to the question of “is the project worth it?”

THE COURT: JUDGE NEWHOOK

Q. Mr Pitches can you just help me with something here?

A. Yes.

Q. How do you think, in a practical sense, we could gain reassurance from a model or a document that doesn’t yet exist?

A. The – a little bit further on I make a recommendation about how you can evaluate projects after the fact and compare that with the model, and that would suggest whether the model is consistent with the actual result.

Q. You are not suggesting that after the motorway is built there is an assessment of the thing against previous predictions?

A. Yes.

Q. And if it doesn’t stack up we rip the motorway up?

A. No, of course, by then it’s too late, but what we are suggesting is that if this project is modelled on a concept that there is a benefit of 1.2, and that’s the sole basis for this project proceeding, so what we are recommending, not just for this project, but for any motorway project, is if that is the case, it would be wise to do a post-implementation review to ascertain to ascertain if those benefits were met.

Q. But perhaps I should listen to you and then argue, but I will let you know what I’m going to ask you, and it’s this. What business is it of ours as a Board to impose a condition that there be some future economic study, ex post-facto the project, one supposes to inform future decision making. Isn’t that more a matter of National policy, isn’t that something you should be talking to the Minister of Transport about?

A. It is actually, yes.

Q. And you probably are?

A. Yes.

Q. Maybe, if you are not a lawyer, you may not be able to answer the point,

30 but I’m just wondering what business we have to direct that there be future academic or other – economic or other academic studies that might inform future decision making outside of this project. This hearing’s about this project.

A. Sure I understand that. Mr Arbury has a few comments on that.

Q. Thank you.

MR ARBURY:

In response to that matter I think the concern that the Campaign for Better Transport has is that often this hasn’t happened in the past and this is an opportunity to require a post-construction audit. Obviously it’s up to the Board to decide whether that’s appropriate or not or in the scope or not.

THE COURT: JUDGE NEWHOOK

Or indeed whether it’s within our legal jurisdiction Mr Arbury.

MR ARBURY:

Yep, yep.

THE COURT: JUDGE NEWHOOK

That’s what’s troubling me a bit.

MR ARBURY:

Sure. No I certainly understand that, we’re just suggesting the possibility.

THE COURT: JUDGE NEWHOOK

The desirability. Okay, carry on.

Waterview – What Is The Risk?

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The Campaign For Better Transport appeared before the Board of Inquiry for the Waterview motorway project.  A copy of our representation is here, but key sections are:

The CBT remains opposed to the project in its current form, as we consider it does not contribute to a more sustainable transport future for Auckland.

We also consider that many of the project’s supposed benefits have not been proven by NZTA’s evidence. Therefore, under section 5 of the RMA the ‘balancing act’ – outlined succinctly in paragraph 103 of NZTA’s legal submissions – has not been sufficiently met.

Furthermore, none of the supposed benefits have been evaluated in the context of rising fuel prices. Consideration of project risk is completely absent from NZTA’s evidence.

The current escalating petrol prices are a real risk to the economic viability of the project in our opinion:

The rebuttal evidence of Mr Tommy Parker, on behalf of NZTA, notes that the project’s ‘cost-benefit ratio’ (BCR) varies, according to the transport model used and whether or not wider economic benefits are included or not (paragraphs 36-40). Under the ART2 model the project enjoyed a BCR of 2.1: that is, the $2 billion invested in the project was estimated to generate $4.2 billion of economic benefits (mainly in the form of travel time savings) over the lifespan of the project.

However, in April 2010 the (supposedly new and updated) ART3 model was used to analyse the benefits of the project, and its BCR reduced to 1.2. That is, for the $2 billion spent on the project, the economic return was now only calculated to be $2.4 billion. It is unclear what happened to the other $1.4 billion in benefits, whether they ever existed or not. Nowhere in NZTA’s evidence, to the CBT’s knowledge, is this issue fully examined…

While the NZTA may have come up with an arbitrary BCR value to aid guidance of project options, it has conducted no risk assessment, which would be standard practice in the commercial world when considering a $2bn investment.

Since we made our submission in October of last year, petrol prices have risen from $1.82 per litre to $2.16 today. Based on the experience of 2008, this will lead to reduced private vehicle trips and increased pressure on the public transportation system.

Given that there is a statistical base for modelling the effect of petrol price increases, we find it negligent of NZTA not to produce risk scenarios for petrol prices of $2.50, $3.00 or even $5.00 a litre. There must surely be a price level where the project is no longer economically justified, and we put it to the Board that consent for the project should only be granted once this price level is known.

We conclude:

The CBT considers there are fundamental questions about the project’s justification that remain unanswered. However, we seek to narrow the matters outlined in our submission down to three particular matters:

- That NZTA should be required to conduct a risk analysis for the project with regard to the price of fuel, and determine the price level where the project no longer becomes economically viable. This will help inform the Board to make an assessment on the likelihood of that price level being reached.

- Should approval be granted, that NZTA should be required to construct (potentially in conjunction with Auckland Transport) a cycleway between SH20 and SH16, above the tunnel section of the project.

- Should approval be granted, that two additional transport related conditions be applied to the consent. These are as follows:

  • That NZTA be required to undertake an “audit” of the project’s benefits at various dates post-construction to help inform the economic justification of future transport projects.
  • That NZTA be required to work with Auckland Transport to find constructive ways of improving bus, cycling and walking infrastructure along main arterial routes that will experience reductions in traffic numbers as a result of the project, to ensure the project generates ‘modal choice’ and to ensure the traffic reduction benefits are ‘locked in’.

Submission on Waterview Connection

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Submissions on the Waterview Connection Project close Friday 15th October at 5:00pm. 

The Campaign for Better Transport’s submission is here .  In summary:

  • It is questionable whether the project will achieve the objectives that NZTA have highlighted.
  • The proposed bus shoulder lanes along State Highway 16 are an inadequate gesture to provide high quality “Quality Transit Network” standard public transport along this route. Suggestions to improve the quality of the lanes are detailed further in the submission.
  • Further public transport improvements on local arterial roads must form part of this project package, to ensure that the traffic benefits of the project are “locked in” and not lost to induced demand.
  • Extensions and improvements to the proposed cycle paths are required to ensure the project contributes to multi-modal transport benefits.
  • The widening of State Highway 16 must be questioned and reassessed, as the documentation accompanying the application states it will not bring any congestion relief benefits – but will cause significant environmental effects. It is also noted that the State Highway 16 works have been “snuck into” this application – which is generally presented as only the Waterview Connection.
  • Support of the designation’s protection of the Avondale-Southdown rail corridor.

If you feel inclined to make your own submission, you must ensure that the EPA receives your submission by 5.00pm, Friday 15 October 2010 at:

Environmental Protection Authority

Waterview Connection project

PO Box 10720

The Terrace

Wellington 6143

Or email:

Or fax: 04 439 7714. Please mark in the subject line: “Waterview Connection project”.

You must also send a copy of your submission to the applicant, the NZTA, whose address for service is:

NZ Transport Agency

Attn: Deepak Rama

Waterview Connection Project

Private Bag 106602

Auckland 1143

Phone: 09 368 2001 or Fax: 09 969 9813

Or email:

Waterview Backflip

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Brian Rudman comments in the Herald on the sneaky press release just before Christmas.

Think of a figure, double it, add your age and subtract the number of eels in Oakley Creek: that, it seems, is as good a guess as any for the price of completing the Waterview Connection.

I’m not surprised Transport Minister Steven Joyce and the NZ Transport Agency waited until the eve of the Christmas exodus to sneak out the highly embarrassing news that a tunnel was, after all, the most cost-effective and environmentally sensitive way to join State Highway 20 up to the Northwestern Motorway at Waterview.

ARC cool on hybrid Waterview link plan

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The ARC feels insufficient information has been provided to properly assess the Waterview motorway link and it still prefers the option of a longer link through Rosebank Rd.  The Herald reports:

Auckland Regional Council’s transport committee has withheld support for the latest cut-down version of a motorway through Waterview involving a mix of surface and tunnelled sections.

The committee yesterday deemed it had received insufficient information to assess the $1.4 billion scheme before the Transport Agency board meets in a fortnight to consider submissions and decide whether to push ahead with the final link in Auckland’s western ring route.

It also restated its preference for a longer link through Rosebank Rd as “the superior strategic alignment” to connect the Southwestern and Northwestern Motorways, even though the Government ruled that out early this year as too expensive, while instructing the agency to review various Waterview options.

The regional councillors affirmed their support for completing the 48km ring route between Manukau and Albany, but questioned the strategic justification for running it through Waterview, where the latest proposal will require the demolition of up to 365 homes and loss of 5ha of public open space.

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City’s backing for surface/tunnel plan riles locals

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Mathew Dearnaley reports on the Auckland City Council’s preference for a “surface-tunnel” option for the Waterview Motorway.  From the Herald:

Auckland City’s transport committee has infuriated communities in the path of the Waterview motorway by supporting the Government’s preference for a revised “surface-tunnel” option.

“I’m absolutely gutted by the response from our council – I think they have been irresponsible,” Margi Watson, Waterview-based spokesman of the Tunnel or Nothing protest group, said yesterday.

“The council was elected to represent the interests of communities, not the Government.”

Members of the ruling Citizens and Ratepayers bloc, led by Deputy Mayor David Hay, outvoted minority City Vision and independent councillors in backing the revised scheme, which the Transport Agency estimates will cost $1.4 billion.

That differs from the council’s previous support for a pair of deep tunnels to carry traffic along most of a 4.5km link between the Southwestern and Northwestern Motorways, and will provide extra comfort to the agency’s board when it meets in Auckland late this month to approve the new plan.

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Why building motorways sometimes makes no sense

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I’m reading an excellent book at the moment – Resilient Cities by Peter Newman, Timothy Beatley and Heather Boyer. I commented on this book a few posts ago, with particular reference to how pathetic our preparedness for peak oil is and how stupid Treasury’s oil price predictions are. I have just got up to reading the chapter which relates to transportation issues, and there are certainly some interesting points in it.

The basic premise is that for a city’s transportation system to be resilient – that is to be able to adapt to the changing world that we face over the next few decades – it simply can’t be as auto-dependent as many American cities, as well as Auckland, are at the moment. Whilst electric cars may come along and be the answer to our problems at some point in the future, to properly ensure that the effects of peak oil and climate change are not too horrific there is simply no alternative to making cities more public transport oriented.

One point that I found particularly interesting, before I get on to explaining the pointlessness of building more motorways, is the relationship between increased public transport use and decreased car use. Often it is simply thought of as a one-to-one relationship: that each increased ride for public transport is one fewer trip made in the car. However, it appears as though the relationship is actually stronger than that: that “there is an exponential relationship between increased transit use and declining car use.” This is further explained:

This helps explain why use of cars by inner-city residents in Melbourne is ten times lower than that of fringe residents, though transit use by inner-city residents is only three times greater. The reason is that when people commit to transit, they may sell a car and even more closer to the transit, eventually leading to lan use that is considerably less car dependent.

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Waterview Tunnel Canned

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The Herald reports that the Government has canned the Waterview tunnel, but hasn’t announced what it will be replaced with just yet.  The Transport Agency is expected to make a decision today.  The maximum budget for the project will be $1.4bn.  Act MP John Boscawen thinks the whole thing can be done for $500m, so I’d be interested to see that proposal.


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