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BITRE | Working paper 74

vehicle operating costs and emissions, was around $5.6 billion in 2005 (BTRE 2007,

p. 9). Taking into account the separate estimates for increased vehicle operating

costs and emissions, this implies that the cost of reduced reliability of the network is

around 15 per cent of the BTRE aggregate congestion estimates of $9.30 billion dollars

for 2005 (BTRE 2007, p. 8).

Vehicle operating costs and emissions

Again, while there is no simple figure for these costs, there are standard

recommendations for vehicle operating costs (VOC). However, while the increased

VOC due to congestion tend to be separately identified, these are not external costs

but are borne by road users. Furthermore, they are different to the time costs of

congestion because the latter are spread across all road users while the actual decision

makers faces the VOCs. Hence, there is no so-called ‘market-failure’ involved in the

increased VOCs due to congestion. Hence, there is a strong case for not implying

that they are an external cost that requires addressing along with the time costs of

congestion.

The cost of emissions is likely to be borne, in part, by other motorists. However, the

extent to which this occurs will be determined by their use of the ‘recycled air’ button

in preference to ‘fresh (sic) air’.

B2

Base case

The reference point, or base case, is equally critical in determining congestion costs.

The standard points of comparison are between the current situation and:

• free-flow, providing the basis for ‘total congestion costs’

• another nominated speed, such as posted speed

• an efficient level of congestion.

Free-flow and total cost measure of congestion

The total cost of congestion is defined as ‘the value of excess travel time and other

resource costs incurred by the current traffic over those that would have been

incurred if the current traffic volumes had been able to operate with unit costs

characteristic of uncongested free flow conditions’ (BTCE 1996a, p. 26).

The concept is also presented as cost of congestion relative to a situation where

there is no congestion at all (BTRE 2006b, p. 7). The oft-quoted figures from the Texas

Transportation Institute reflect estimates of the total cost of congestion.

One argument for the use of the total costs of congestion, apart from the costs of

deriving them, is that they convey information about the magnitude of the problem ‘in

a clear way’. Further, it is argued that ‘measuring the size of a problem is not identical

to stating that this size should or could be zero’ (Koopmans and Kroes 2004, p. 7).

However, what is intended is not what is always achieved and the lay interpretation of

the total cost of congestion estimates is often that the size should be zero.

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