Evaluation of Low Volume Roads

Rodrigo Archondo-Callao Senior Highway Engineer, ETWTR January 10, 2008

The World Bank

World Bank Technical Paper No. 496

Road Transport
Farm
Typical Transport Infrastructure

Household

Village

Market Center

District Headquarters

Regional Headquarters

Capital / Port

Track

Path/Track

Track/Earth Road

Earth Road/Gravel Road

1-2 lane Gravel / SD* Road >100 AADT 20-100 Km.

2 lane AC** Road

Typical Value Typical Distance Share of Asset Value

NMT 1-5 Km.

NMT 0-5 AADT 1-10 Km.

NMT 5-50 AADT 5-20 Km.

NMT 20-200 AADT 10-50 Km.

>1500 AADT 50-200 Km. 40% 20% 0%

Share of Road 40% Network 20% 0% Comunidad Responsibility Type of Network Gobierno Local Gobierno Provincial / Central Rural Transport Infrastructure Primary, Secondary and Municipal Roads

Tracks

Roads

Highways

Functional Classification
Road Network Functional Classification Responsibility % of Road Network Physical Characteristics Road Primary, Secondary and Municipal Roads Primary Secondary Arterial Collector National Regional Municipal (Urban) +- 10% +- 10% +- 10% 2 or more paved lanes 1.5 to 2 gravel or paved lanes Rural Transport Infrastructure Tertiary Access Local Government Community +- 70% 1 to 2 earth or gravel lanes N.A. tracks Streets & Avenues Urban Municipal

Normally sections Normally sections Normally sections Normally sections with 20 to 100 kms with 50 to 200 kms with 5 to 20 kms with 1 to 5 kms Traffic Characteristics Economic Evaluation Social Evaluation Financial Evaluation Technical Evaluation Environmental Evaluation Safety Evaluation > 500 AADT Yes No Tolls Yes Yes Yes 50-500 AADT Yes Complimentary No Yes Yes Yes < 50 AADT + NMT No Yes No Yes Yes Yes Mostly NMT No Yes No No No No

Primary Road Network

Roads with 2 or more lanes Paved roads Traffic greater than 500 AADT Long distance traffic Essentially serves an economic function Focus is the reduction of transport costs

Cost Benefit Analysis (CBA) using the HDM-4 model

Secondary Road Network

Road with 1.5 to 2 lanes Unpaved roads or paved roads Traffic less than 500 AADT Medium distance traffic Economic and social function Focus is the reduction of total transport costs, measuring also the social impact

Cost Benefit Analysis (CBA) using RED model or HDM-4 model

Tertiary Road Network

Roads with 1 to 2 lanes Unpaved roads and tracks Traffic lower than 50 AADT difficult to measure Short distance traffic Essentially serves a social function Focus is the social impact, measuring the efficiency of the investments and/or a multicriteria index

Cost Efficiency Analysis (CEA) or MultiCriteria Analysis (MCA)

Analytical Instruments
Cost Benefit Analysis (CBA) Net Present Value Cost Efficiency Analysis (CEA) Total Beneficiary Population per Investment Multi Criteria Analysis (MCA) Priority Index

Cost Benefit Analysis (CBA)

Total Society Costs

Road User Costs

Government Costs

Improve Standard

CBA

Comparison of Alternatives with CBA

To compare project alternatives, the Net Present Value is used to select the optimal alternative (the one with higher NPV) and to eliminate project that are not economically feasible (NPV<0) The Internal Rate of Return (IRR) or the Benefit/Cost and NPV/Investment ratios are not recommended to compare project alternatives
Project Alternatives NPV 0.0 3.7 6.7 5.5 Optimal Alternative: Higher NPV CBA

Comparison of Projects with CBA

To compare the economic priority of projects, it is recommend the use of the indicator NPV per Investment or a budget constraint optimization algorithm, such as EBM-32 contained on the HDM-4 and RED models.
Selected Alternative
Projects Overlay

NPV / Investment
8.4 5.2 2.1

Reseal
Overlay

P R I O R I T Y

CBA

Projects Eligibility with CBA

To define if a project is eligible, it is recommended to utilize the NPV (NPV > 0) or the IRR (IRR > x%), at a given x% discount rate.
NPV Projects 42.2 25.4 -5.5 IRR 25% 17% 9%

Eligible
Not Eligible

CBA

Cost Efficiency Analysis (CEA)

It compares the cost of interventions with its predicted impacts and it is used in the situations where the benefits cannot be measured in monetary terms, or where the measurement is difficult. It includes provisions that (a) the objectives of the intervention are indicated and are clearly part of a ampler program of objectives (such as reduction of the poverty); and (b) the intervention represents the smaller cost alternative of obtaining the indicated objectives. It produces efficiency indicators such as Total Beneficiary Population per Investment.
CEA

Comparison of Alternatives with CEA

To compare project alternatives, the investment cost is used to select the optimal alternative The selected alternative will be the one with the lowest investment cost that will provide the road all-weather access
Alternatives Investment 2.0 Optimal Alternative: 3.7 Lower Investment 1.7 CEA 5.5

Project

Comparison of Projects with CEA

To compare the economic priority of projects, it is recommended the use of the efficiency indicator Total Beneficiary Population per Investment
Alternative with Lowest Cost Projects Resurface Grading Resurface Total Beneficiary Population / Investment 20 14 5 P R I O R I T Y

CEA

Projects Eligibility with CEA

To define if a project is eligible it is recommended to define a minimum acceptable efficiency indicator Total Beneficiary Population per Investment
Projects Total Beneficiary Population per Investment 20 14 5

Eligible
Not Eligible

CEA

Total Beneficiary Population per Investment

10 15 20 25 30 35 40 0 5

0 1.1 1.1 1.2 1.3 1.3 1.4 1.5 1.7 1.8 2.0 2.2 2.5 2.9 3.3 4.0 5.0 6.7 10.0
Not Eligible Frequency

Projects Eligibility with CEA

?
Eligible

CEA

20.0

CEA Indicators
Investment Cost per Total Beneficiary Population
100 US$ per person

Total Beneficiary Population per Investment Cost

0.01 persons per US$

Total Beneficiary Population per Investment Cost in thousands of dollars

10 persons per 1,000 US$

CEA

Multi Criteria Analysis (MCA)

It adopts criteria such as traffic, proximity to educative, health, and economic centers, which receive weights (points) concerning their perceived importance. The added number of the points that each section receives is computed simply adding the points assigned for each criterion, or with the use of a more complex formula.

MCA

Multi Criteria Analysis Example

Inhabitants benefited per km Percentage of extreme poverty Productive area Average traffic Functional classification Location in the optimal network Number of health centers Number of schools Existence of public transport Environmental feasibility
MCA

Multi Criteria Analysis Example

Population Beneficiary Population per km Poverty Poverty Percent Agricultural Area Percent of Area of Influence Traffic Daily Traffic (AADT) Functional Classification A=4 B=3 C=2 D=1 Priority Index Location on Basic Network Yes = 1 No = 0 Factor Factor Factor Factor Factor Factor

9,889 520 1,237 564 344 503

1.00 0.05 0.13 0.06 0.03 0.05

99% 99% 99% 97% 97% 97%

1.00 1.00 1.00 0.98 0.98 0.98

0% 0% 0% 14% 36% 18%

0.25 0.64 0.32

20 20 15 80 15 35

0.25 0.25 0.19 1.00 0.19 0.44

1 2 2 3 3 3

0.33 0.67 0.67 1.00 1.00 1.00

1 1 1 1 1 1

1.00 1.00 1.00 1.00 1.00 1.00

ity Index Health Centers Yes = 1 No = 0 Schools Yes = 1 No = 0 Public Transport Yes = 1 No = 0 Environment Feasibility Yes = 1 No = 0 Priority Index

Factor

Factor

Factor

Factor

0 0 0 0 0 0

0 0 0 1 1 1

1.00 1.00 1.00

1 1 1 1 1 1

1.00 1.00 1.00 1.00 1.00 1.00

1 1 1 1 1 1

1.00 1.00 1.00 1.00 1.00 1.00

5.6 5.0 5.0 7.3 6.8 6.8

Factor = Value / Maximum Value

MCA