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TRANSPORT and ROAD RESEARCH LABORATORY Department of the Environment Department of Transport TRRL LABORATORY REPORT 912 THE EFFECT OF TRAVEL COSTS ON THE DESIGN OF HIGHWAY ALIGNMENTS by J Broughton BSc PI1D Any views expressed in this Report are not necessarily those of the Department of the Environment or of the Department of Transport Access and Mobility Division Transport Operations Department "Transport and Road Research Laboratory Crowthorne, Berkshire 1979 ISSN 0305-1293

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Page 1: TRANSPORT and ROAD RESEARCH LABORATORY Department of … · a method has been devised for introducing travel costs into the alignment optimisation. This allows inter- action between

TRANSPORT and ROAD RESEARCH LABORATORY

Department of the Environment Department of Transport

TRRL LABORATORY REPORT 912

THE EFFECT OF TRAVEL COSTS ON THE DESIGN OF HIGHWAY ALIGNMENTS

by

J Broughton BSc PI1D

Any views expressed in this Report are not necessarily those of the Department of the Environment or of the Department of Transport

Access and Mobility Division Transport Operations Department

"Transport and Road Research Laboratory Crowthorne, Berkshire

1979 ISSN 0 3 0 5 - 1 2 9 3

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Abstract

1.

2.

3.

4.

CONTENTS

Introduction

The maximisation of the economic value of a highway scheme

2.1 The economic value of a highway scheme

2.2 An economic criterion for use in highway design

2.3 The implementation of the new criterion

The inclusion of traffic costs in MINERVA

3.1 The Traffic Cost Model

3.2 The new objective function used with MINERVA

An optimisation with traffic costs included

4.1 The test scheme

4.2 The vertical alignment which minimises the construction cost

4.3 The optimisation of the scheme to maximise its economic value

4.4 Summary of results for the test scheme

4.5 Limits on gradient

4.6 The cost implications of the new objective function

5. Conclusions

6. Acknowledgements

7. References

8. Appendix 1 :

9. Appendix 2:

9.1

9.2

Notation

The Traffic Cost Model

A model for calculating travel costs

The Growth Factor

Page

1

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2

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6

7

8

9

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© CROWN COPYRIGHT 1979 Extracts from the text may be reproduced, except for

commercial purposes, provided the source is acknowledged

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Ownership of the Transport Research Laboratory was transferred from the Department of Transport to a subsidiary of the Transport Research Foundation on 1 st April 1996.

This report has been reproduced by permission of the Controller of HMSO. Extracts from the text may be reproduced, except for commercial purposes, provided the source is acknowledged.

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THE EFFECT OF TRAVEL COSTS ON THE DESIGN OF HIGHWAY ALIGNMENTS

ABSTRACT

The alignment chosen for a new road will affect the travel costs of all drivers using it. In current practice, travel costs are taken into account when making an economic evaluation of a new road but are often not included explicitly when designing the alignment of the road. This inconsistency may lead to the construction of a new road to a design which does not represent the best balance between the costs of travel and of construction.

In this report a simple method is described for allowing the expected travel costs of a new road to influence the design of the alignment. The con- version of an existing vertical alignment optimisation computer program to take account of travel costs is described.

The new program has been applied to a current highway scheme with a vertical alignment that had been optimised to minimise the scheme's construction cost. The highway considered passes through hilly terrain, and it is shown that an improvement in the economic value of the scheme can be achieved by introducing travel costs into the design process.

1. INTRODUCTION

The Highway Optimisation Program System 1 (HOPS) has been developed at TRRL to assist the highway

engineer in the choice of an optimal vertical alignment for a road design whose horizontal alignment has

been previously defined. The system has proved successful in reducing construction costs but it has been

felt that, in common perhaps with more conventional design techniques, there was insufficient scope for

taking account of the travel costs incurred by the future users of the road.

The aims of reducing construction costs and travel costs are often in conflict when designing the

alignment of a new road. The minimisation of construction costs will find the cheapest alignment which

is suitable for the use of traffic and which obeys such constraints as maximum permissible gradients. In

contrast, the minimisation of travel costs willprobably be achieved by a road of constant gradient joining

the end points. An optimal design must lie between these extremes, balancing increases in construction

costs above the minimum against savings in travel costs.

Withey 2 has studied the possibility that road users were penalised when the design for the vertical

alignment of a length of motorway was optimised specifically to minimise the costs of earthworks. The

motorway passed through gently undulating country and Withey concluded that "the savings of earthworks'

"costs exceeds any increase in vehicle operating costs by 20 to 1 at least and the decision not to include

vehicle operating costs in the optimisation ~rocedure is justified". However, Withey's test was based on a

motorway with a maximum permitted gradient of three per cent, and it was felt that his conclusion was

mainly applicable to roads with such low gradients. Some roads have much higher gradients and accordingly

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a method has been devised for introducing travel costs into the alignment optimisation. This allows inter-

action between construction costs and travel costs, leading to a design that offers the best compromise

between economies in the two types of cost.

Drivers using a new road in the course of a journey will incur lower costs than if only the original

road network were available. Such savings in cost contribute to the overall benefit derived from a new

road, and the value of a proposed road is currently established by comparing the expected benefits with

the costs of construction, using the techniques of cost-benefit analysis. Thus, the optimal design for a new

road should achieve the best balance between costs and expected benefits, and the minimisation of

construction costs is only one aspect of the optimisation. It may be possible, once construction costs

have been minimised by 0ptimisation, to further improve the scheme by making changes to the alignment

which, in return for an increase in construction costs, offer a greater increase in traffic benefits. Such a

balance between costs and benefits is discussed in this Report, and a criterion for choosing a best design

is developed that embodies the economic principles of the COBA program 3. This leads to a convenient

form of optimisation procedure and the method has been incorporated in a specially modified version

of MINERVA 4, a computer program in the HOPS system which optimises vertical alignments to minimise

construction costs.

The modified version of MINERVA has been tested on a current road design for a rural by-pass

through hilly country. This test was made to illustrate the effect of the new optimisation procedure on

vertical alignment design. The results of the test are presented in this Report.

Although MINERVA optimises only vertical alignments, the same method of treating travel costs can

be applied in the simultaneous optimisation of the vertical and horizontal alignments of a new road. The

influence of travel costs on the design are greater when the horizontal alignment may be varied, as the

opportunity exists of shortening the road and "so reducing travel distances; however, this is not covered in

detail in this Report, which deals mainly with vertical alignment optimisation. The method has been

implemented in NOAH, a horizontal alignment optimisation program that has been developed at TRRL.

A test of NOAH on a major motorway scheme has been reported 5 and gives further evidence of the effect

of travel costs on highway alignment optimisation and on the economic evaluation of a scheme.

2. THE MAXIMISATION OF THE ECONOMIC VALUE OF A HIGHWAY SCHEME

The economic value of a highway design depends on a wide range of factors and so it is generally complicated

to evaluate. In Section 2.1 the methods currently used are summarised, and in Section 2.2 the use of these

in highway design is described. A simplified form of the current economic criterion for selecting the best

from a group of designs is developed. This is applied in Section 2.3 to the question of alignment optimisation,

and it is shown that in this case only construction and travel costs need be considered when finding the

alignment which maximises the economic value of the scheme.

The definition currently used for the economic value of a new road excludes any effect which at

present cannot be costed in a generally accepted manner, so social and environmental factors are excluded.

These are, however, often significant and if suitable methods of costing become available then it will be

possible, in principle, to include them in the framework described below, to affect the alignment optimisation

directly. In the absence of such methods, various strategies can be adopted to take account of these effects

indirectly during optimisation.

2

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2.1 The economic value of a highway scheme

The purpose of constructing a new road is to redistribute traffic over the surrounding road network

in order to achieve a series of objectives, including alleviation of traffic congestion, a reduction in the

number of accidents, shorter travel times and reduced vehicle operating costs. The economic merit o f the

new road is currently based on the expression of the last three of these items in financial terms, and the

benefit to the community for each item is then calculated by comparing the original situation with that

resulting from the construction of the new road. For example, the benefit to vehicle operating costs in

each future year is calculated on the basis of predictions for that year of traffic flows over the original

network and over the extended network which includes the new road. Total vehicle operating costs are

calculated for the two networks, and the benefit is estimated by calculating the reduction in cost.

The benefits will naturally be spread over a number o f years, and the method of discounting is used

to express future benefits in terms that are compatible with the construction costs. A discount rate r is

laid down, and any benefit obtained i years after construction is divided by (l+r)i; thus, the later a benefit

is experienced the less it is worth in comparison with the cost o f construction. The discounted benefits

are then accumulated over a lengthy period, usually the first thirty years o f operation, to give the "overall

benefit" of the scheme.

This overall benefit is set against the cost of constructing the new road, to see whether it represents

a satisfactory return on the capital investment. Two important economic indicators are:

Net Present Value (NPV) = Overall Benefit - Construction Cost

NPV/C Ratio = Net Present Value/Construction Cost

The NPV/C ratio of a highway scheme measures the benefits expected by the community as a

proportion of the capital investment, and it plays an important part in determining the ranking of the scheme

within the road programs in Britain. In particular R, a minimum acceptable value for the NPV/C ratio, is

specified by the Government and any scheme whose ratio is less than the current value o f R will be rejected

or postponed, unless there are overriding considerations.

2.2 An economic criterion for use in highway design

It is normal when designing a new road for the engineer to consider a number o f different alignments,

one of which will eventually be chosen for construction. This choice will be influenced by many criteria

including economic and technical factors, environmental considerations and the views of local residents.

The economic criterion that has been recommended is based on the Incremental NPV/C Ratio, an index

used to compare the economic merits o f two alternative alignments. In order to define this ratio, suppose

that alignments s and t are to be compared, where t is more expensive than s and where construction costs

and overall benefits are Cs and Ct, Bs and Bt respectively. The Incremental NPV/C Ratio that compares s

and t is

IR = ( ( B t - Ct) - ( B s - Cs) ) / ( C t - Cs) . . . . . . . . . . . . . . . (1)

and for t to be preferred to s this ratio must exceed R.

3

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A procedure is recommended in the COBA manual 3 which operates in several stages to choose the

best from a group of alignments. In the first stage, the alignments are ranked in order of increasing cost,

and the cheapest is taken as the standard for the next stage. In the next stage, the standard is compared

with successively more expensive alignments until either an alignment is found for which IR > R or it

has been shown that for all the remaining alignments IR < R. In the second case the standard is chosen as

the best alignment, in the first case the new alignment becomes the standard for the next stage, and

the procedure continues with a new set of comparisons.

A similar procedure can be developed directly from the definition of the Incremental NPV/C Ratio.

Suppose that u and v are two alignments to be compared using the Ratio, then if u is more expensive than v,

u is preferred to v if

so from (1)

and

IR ~ R

(Bu-- Cu) - ( B v - Cv) > R . ( C u - Cv)

( B u - C u . ( 1 + R ) ) > ( B v - C v . ( 1 + R ) )

Alternatively, if v is more expensive than u, u is preferred to v if

IR < R

so f r o m ( l ) ( B v - C v ) - ( B u - C u ) < R . ( C v - C u )

and (Bu - Cu. (1 + R) ) > ( Bv - Cv. (1 + R) )

Thus, irrespective of their relative construction costs, to choose between u and v it is necessary to evaluate

the function:

Overall Benefit - (1 + R) . Construction Cost . . . . . . . . . . . . . . (2)

and take the alignment which gives the higher result. This argument leads to a new method for choosing

the best among a group of alignments: select the alignment that maximises this function. The alignment

chosen by the COBA procedure will always maximise the function (2), so that the method developed

here will always have the same result as the COBA procedure but is quicker and more convenient.

It may be noted that if R is zero then (2) is equal to the Net Present Value of the design, and it is

the zero value that is currently used for scheme evaluation. Positive values for R have been used in the

past, and it is possible that positive values will again be used, so R will be treated as a variable in this section.

2.3 The implementation of the new criterion

The method developed in the preceding section can be used in an optimisation procedure. If all the

trial alignments generated during optimisation are compared, the one that maximises (2) will have the

greatest economic value, so that (2)is the objective function for an optimisation procedure to maximise

the economic value of a highway. One of the terms in (2) is the overall benefit, which depends on a range

of factors. It is shown in this section that under a particular condition many of these can be eliminated

from the objective function, leaving only those which can be calculated directly from the configuration of

the road and the traffic expected to use it.

4

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The condition mentioned above is that the changes made to the alignment during optimisation should

not be so great as to alter the traffic flows predicted for the new road. This will be valid so long as the changes

made are insufficient to persuade drivers to change their choice of route. This condition will apply during

the optimisation of the vertical alignment of a scheme for which the horizontal alignment is fixed; it will

also apply during horizontal alignment optimisation where the re-alignment is limited to a narrow corridor.

It will be assumed henceforth that the range of alignment changes possible during optimisation is such

that the condition is satisfied. Most benefits are now effectively fixed during optimisation: in particular,

all the benefits from improved travel on the surrounding road network will be fixed. On the new road, the

number of accidents in a future year will not vary significantly with alignment changes, as predicted by the

relationship used in COBA3: this relationship takes no account of vehicle speeds and predicts 0 .4-1.2

personal injury accidents per million vehicle-kilometres on different classes of rural highway. As traffic

flows have been assumed to be independent of alignment, the number of accidents will depend only on

the overall length, and any change in the costs attributable to these accidents will be negligible in proportion

to other travel costs and benefits.

Thus, the only benefits which can be costed and which depend significantly on the alignment are

reductions in the costs and delays incurred by individual vehicles in driving along the road. Lower gradients

will lead to reduced vehicle operating costs and shorter journey times, and the effect of the latter is costed

using a value for the occupants' time per vehicle. The time and operating costs for a single vehicle form

the travel cost for the journey of that vehicle along the new road, and so of the various items contributing

to the objective function (2) it is only travel and construction costs that vary with alignment changes.

The summary in Section 2. t of the method for assessing the benefit to vehicle operating costs

resulting from a particular alignment for the new road leads to a simple form of objective function, derived

from (2). Let N be the original network of roads, to which the road is to be added. Then ]n a future year

the benefit will be:

Vehicle operating cost for the network N before construction of new road

- (Vehicle operating cost for N after construction + Vehicle operating cost for new road)

= Reduction in cost over N due to new road - Cost for new road.

The reduction in cost over the network N that results from the new road will not vary with alternative

alignments if the condition mentioned above is satisfied. Consequently, for a particular alignment the

contribution of vehicle operating cost savings to the overall benefit is the discounted sum of the savings

over N for any alignment minus the discounted sum of vehicle operating costs for that alignment. The

reduction in time costs can be expressed similarly. Thus, if BY is the discounted sum of travel cost savings

over the original network N, the contribution of travel cost savings to the overall benefit is:

Contribution to Overall Benefit = BY - Discounted sum of travel costs for alignment

and BY is constant for all alternative alignments. The discounted sum of travel costs for a road is often

referred to as the "traffic cost" for that road.

5

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The other economic benefits (accidents, reductions in noise, etc) for the complete network do not

depend significantly on the alignment chosen, so their discounted sum BZ will remain constant. Hence,

for all alternative alignments the overall benefit can be expressed:

Overall Benefit = (BY + BZ) - Traffic cost o f alignment . . . . . . . . . . . (3)

so (2) can be re-written:

Objective Function = (BY + BZ) - [Traffic Cost + (1 + R) . Construction Cost] . . . . (4)

As BY and BZ are constant for all the alignments that will be generated during an optimisation, the

alignment which maximises (4) will minimise the revised objective function:

Objective Function = Traffic Cost + (1 + R ) . Construction Cost . . . . . . . . . (5)

Consequently, the traffic cost is the only component of the overall benefit that needs to be con-

sidered when designing the road to maximise its economic value. This simplifies the calculations greatly.

Equation (1) of Section 2.2 can also be simplified. Let Ts and Tt be the traffic costs of alignments

s and t respectively, then from (3) the increased benefit o f t compared with s is

Bt - B s = T s - Tt

so that the Incremental Ratio is

IR = [ ( B t - B s ) - ( C t - C s ) ] / [ C t - C s ]

= [ ( T s - T t ) / ( C t - C s ) ] - 1 . . . . . . . . . . . . . . . . . ( 6 )

The objective function (5) was developed from the Incremental NPV/C Ratio, but it possesses an

inherent logic. It considers that money spent on road-building has a different utility from money spent on

travel: the expenditure o f £1 on improving a road is justified only if the reduction in traffic cost exceeds

£(1 + R). The lower the value chosen for R the greater is the emphasis placed on reducing vehicle operating

costs and raising average speeds in the selection process.

The definition used for the economic value o f a road excluded all effects which at present cannot be

costed, so these are not represented in the objective function. It is sometimes important for one or more

o f these effects to influence the optimisation, and several methods are available. The most direct method

is to specify appropriate standards and then to constrain the alignment at each sensitive point to ensure that

the optimised alignment achieves all standards. An example is the restriction of the level o f the vertical

alignment at sensitive points so that the visual intrusion of the road will be acceptable. Another example

is the use of level restrictions near a residential area to limit the nuisance of traffic noise by ensuring that

the road is in cutting.

3. THE INCLUSION OF TRAFFIC COSTS IN MINERVA

In the previous section the objective function used for alignment optimisation was expanded to include the

traffic cost o f a new road in order to maximise its economic value. In this section it is shown how this

6

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objective function has been implemented in MINERVA 4, a vertical alignment optimisation program from

the HOPS suite of computer programs.

3.1 Tile Traffic Cost Model

The conventional version of MINERVA calculates the construction cost of the road, which is one of

the two parts of the objective function (5): the Traffic Cost Model has been developed for incorporation

into MINERVA to provide the other part. Experience with MINERVA has shown that of the various

components of the construction cost of a road, only the costs of earthworks and bridges change significantly

during vertical alignment optimisation, so these are the only parts of the construction cost treated in the

calculations and included in the tabulated results.

The Traffic Cost Model operates in two stages. In the first stage the total of the first year travel

costs is calculated, using the engineer's prediction for the first year traffic flows, and in the second stage

this total is multiplied by a "growth factor" to give the traffic cost. The Model has been designed to be

simple to use and rapid in operation, as in a typical optimisation it will need to process hundreds of trial

alignments.

In the first stage, the travel costs of representatives of three classes of vehicle - cars, light goods and

other goods vehicles - are calculated from simulated journeys along the road: the costs are obtained from

empirical equations relating vehicle costs and average speeds to the gradients included in the vertical

alignment, and the flows forecast for the three classes in the first year are then applied to obtain the total

of the first year travel costs. It is necessary to assume equal traffic flows in either direction, as the

observations from which the empirical equations derive were averaged over both directions. This is

described more fully in Appendix 2, where in addition the growth factor G is developed as a suitable means

for summarising in one variable the user's forecast of future traffic growth and changes in the real cost of

road travel. It also takes account of the discounting process, which emphasises the early years of operation

and so reduces the effect of the uncertainties that result from forecasting the future. G provides an

estimate of the traffic cost for the new road from the travel costs predicted for the first year of operation:

Traffic Cost = G. Total of the first year travel costs

The costs as first calculated by the Traffic Cost Model are based on the price levels which prevailed

at the date for which the Model's cost equations were prepared (mid-1973). Construction costs are

invariably calculated using design year prices, so these costs must be multiplied by an inflation index I.

This takes account of the change in prices between mid-1973 and the date at which the engineering unit

rates apply to ensure that traffic and construction costs are compared on a common level of prices. Thus

Traffic Cost (design year prices)

= I.G. Total of the first year travel costs (mid-1973 prices)

A value for the product I.G is one of the items of data that must be input to the Traffic Cost Model.

Note that, in order to simplify the calculations, all costs are measured at prices current at the time of

design but are discounted to the year of construction, the time at which the cost of the road is paid. It is

assumed that traffic will begin to use the road in the following year. 7

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Table 1 presents as an example the values of G obtained from different estimates of traffic growth

between 1975 and 2005. These are given by Tanner 6 in a national forecast of traffic growth, and are his

"low, middle and high forecasts" which, for 2005, range from 505 x 109 to 594 x 109 pcu kilometres.

Three different rates of increase in the cost of travel, as measured in constant costs, are also used. The

values of G are only illustrative and for a particular scheme there may be reasons for raising or lowering

them significantly.

TABLE 1

Typical values of the growth factor

Traffic Growth from ref 6)

Cost increase (per cent pa)

0

1

2

Low

11.84

13.06

14.29

Middle

12.22

13.50

14.77

High

12.36

13.65

14.95

This shows that despite the wide variety of conditions covered, G lies between 11.84 and 14.95, and

the smallness of this range is largely the result of the discounting process. If there were no traffic growth

and zero cost increase the value of G would be 10.37. These figures indicate that when using this model a

simple estimate of G, within the range indicated, could well prove adequate.

It should be noted that two important changes I/ave occurred since the work reported here was

carried out: official estimates of future traffic growth have been lowered, and the discount rate has been

reduced from 10 per cent to 7 per cent. These have countervailing effects on the calculation of G, but

the net effect is to increase values to the range 17.3-19.5.

3.2 The new objective function used with M I N E R V A

It is generally true that the greatest possible reduction in the traffic cost of an alignment that can be

achieved by changes to its vertical alignment will be only a small proportion of the original value. If the

absolute minimum traffic cost is subtracted from the objective function then precision will be improved,

for computers can store values with only limited accuracy; moreover, a better indication will be given of

the scope for reducing the traffic cost.

The vertical alignment that will probably minimise the traffic cost is a ramp of constant gradient

joining the fixed end-points, although in practice this is unlikely to be built as it would have a very high

construction cost. The traffic cost for this alignment is termed the "ramp cost". Now, suppose that

alignments s and t have construction and traffic costs Cs and Ct, Ts and Tt respectively, then from (5) s is

preferable to t if

Tt + ( I + R ) . C t > T s + (1 + R ) . C s

8

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The ramp cost TR can be subtracted from both sides:

( T t - T R ) + ( I + R ) . C t > ( T s - T R ) + ( 1 + R ) . C s

so that the objective function:

Objective Function = (Traffic Cost - Ramp Cost) + (1 + R) . Construction Cost . . . . (7)

gives the same optimal alignment as does the earlier function (5), but with less risk of computational

inaccuracy. Thus, the difference between the traffic cost and the ramp cost is calculated by the Traffic

Cost Model and is used in the modified version of MINERVA to maximise the value of a new road.

4. AN OPTIMISATION WITH TRAFFIC COSTS INCLUDED

The special version of the program MINERVA described in Section 3 has been used to optimise an existing

design for a current road scheme. The design was also optimised by the normal version of MINERVA to find

the vertical alignment which minimised the construction cost. Comparison of the two optimal alignments

will demonstrate the effect of including the traffic cost in the optimisation of this vertical alignment.

4.1 The test scheme

The scheme is a by-pass through hilly terrain in South West England. It includes 10.7 km of dual

carriageway trunk road, each carriageway comprising two lanes, and a 500 metre long viaduct. Experience

with MINERVA suggested that in this case the components of the construction cost which would vary

significantly during vertical alignment optimisation were the costs of the viaduct and the earthworks, so

these were the only constructional items included in the calculations. The design standards specified for

this scheme take the normal values for a road of this type, except for the maximum permissible gradient:

this has been set by the designer to 5.1 per cent on account of the hilly terrain.

The ground longitudinal section is shown in Figure 1, and the engineer's alignment is superimposed.

Two optimised alignments are also included in Figure 1 and will be discussed later.

The items of traffic data needed by the program include two-way flows of vehicles estimated for the

first year of operation, divided into categories of cars, light goods and heavy goods vehicles. The data

available consisted of 16 hour flows for the peak month of August, and to obtain annual flows these

were multiplied by the "Annual Traffic Multiplier" recommended in the COBA manual. The resulting

flows during the first year of operation for the different categories were:

Cars 3 666 000 vehicles

Light Goods 177 000 vehicles

Heavy Goods 243 000 vehicles

A growth factor of 11.84 was chosen, this being the lowest value of Table 1, and an inflation index

of 1.35 was selected to allow for price rises between mid-1973 and the time of design, mid-1975. Their

combined effect ig to predict that:

Traffic Cost (1975 prices)

= 16.0. Total of the first year travel costs (1973 prices)

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4.2 The vertical alignment which minimises the construction cost

The normal version of MINERVA was used to find the vertical alignment for the test scheme which

minimised the construction cost: this will be referred to as the Minimum Construction Cost alignment

(MCC), and it is shown in Figure 1. It can be seen that considerable changes have been made to the engineer's

alignment and in particular the height of the viaduct has been increased.

The traffic cost was not considered in designing MCC: nonetheless, the traffic cost of this alignment

can be calculated by the Traffic Cost Model. The Model uses equations that relate velocity and fuel

consumption to gradient to calculate for each category of vehicle the fuel, time and miscellaneous costs

of a typical vehicle. These are then aggregated to give the total of the first year travel costs, as shown in

Table 2.

TABLE 2

Traffic cost calculated for minimum construction cost alignment

Cars

Light Goods

Heavy Goods

Cost per vehicle (averaged over both directions)

Fuel Cost (p)

18.49

53.80

100.62

Time Cost (p)

11.96.

18.23

21.96

Misc. Cost (p)

10.77

21.83

42.76

Total Cost (£)

0.412

0.939

1.653

First year two-way flow

3 666 000

177 000

243 000

Total

First year Traffic Cost

(£)

1 511 700

165 800

401 550

2 079 050

~The ramp cost, as defined in Section 3.2, is calculated to be £1 978 120 in the first year, and this differs

from the total of the first year travel costs by only 5 per cent, despite the hilly terrain. The difference

between the two is now multiplied by the growth factor and the inflation index, to give the value required

by the objective function (7):

£ ( 1 6 . 0 x ( 2 0 7 9 0 5 0 - 1978 1 2 0 ) ) = £ 1 614879

The construction cost for MCC is calculated to be £3 285 686, so the value of the objective function is:

£(1 614 879 + ( 1 + R ) . 3 2 8 5 6 8 6 ) = £ ( 4 9 0 0 5 6 5 + R . 3 2 8 5 6 8 6 )

The same method gives an objective function for the engineer's alignment of £(5 739 629 + R . 3 985 521).

This shows that the new alignment costs £699 835 more than the engineer's design to build, and is economically

superior for all probable values of R.

4.3 The optimisation of the scheme to maximise its economic value

A series of optimisations was carried out on the scheme described in the previous section, using

different values of R: R was defined in Section 2.1 to be the minimum acceptable value of the NPV/C ratio.

This value is normally predetermined for the highway engineer, but it is useful to see how the effect of the

10

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traffic cost on the optimisation varies with R: values of 0.0 and 0.2 were used. The latter value is recomm-

ended in the COBA manual and the former value will lead to the maximisation o f the Net Present Value,

as noted in Section 2.2. The weighting of the construction cost in the objective function (7) declines as

R is reduced, so that the alignment obtained with R = 0.0 would be expected to present the greater

variations from MCC.

The various costs of MCC are compared in Table 3a with the costs for the engineer's alignment and

the alignments optimised using the objective function (7) with R = 0.0 and R = 0.2: these last two align-

ments are referred to as A1 and B1 respectively. The construction costs o f all three are very similar and

only with R = 0.0 is there a significant reduction in the traffic cost.

TABLE 3a

Summary of costs with original traffic forecast

Alignment

Engineer's Alignment

MCC

A1

B1

Traffic Cos t -Ramp

Cost (£)

1 754 109

1 614 879

1 561 650

1 614 039

Earthwork Cost (£)

1 984 534

1 236 188

1 213 270

1 213 938

Viaduct Cost (£)

2 000 987

2 049 498

2 079 653

2 050 126

Construction Cost (£)

3 985 521

3 285 686

3 292 923

3 264 064

No te: MCC - alignment with minimum construction cost

A1 - alignment optimised with objective function (7) and R = 0.0

B1 - alignment optimised with objective function (7) and R = 0.2

The Construction Cost does not include costs that do not depend on the vertical alignment.

The Traffic and Ramp Costs are discounted over 30 years.

Alignment A1 shows some small changes from MCC, but it is only over the central section o f the route that

the changes are significant. These can be seen in Figure 1 : A1 takes a higher, flatter line between chainages

8 500 and 11 000, but otherwise changes are only slight. B1 follows MCC closely, and is not shown in

Figure 1 : the fact that it is 0.7 per cent cheaper than MCC is due to a minor inefficiency in the optimisation

procedure used in MINERVA.

The objective functions o f A1 and B1 are compared in Table 3b with the objective function for

the MCC alignment, evaluated with R -- 0.0 and R = 0.2.

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TAB L E 3b

Objective function with original traffic forecast

MCC

Alignment optimised with particular value of R

R= 0.0

Objective Function

4 900 565

4 854 573 (A1)

per cent of MCC value

99.06

Objective Function

5 557 702

5 530 916 (B1)

R= 0.2

per cent of MCC value

99.52

Note: Objective Function = Traffic Cost - Ramp Cost + (1 + R). Construction Cost These costs are taken from Table 3a.

It can'be seen that the reductions in the objective function are slight, and this leads to the conclusion

that the alignment that minimises the construction cost very nearly maximises the value of the scheme.

One reason for this may be that on this scheme traffic flows, and hence the traffic cost, are relatively low

for this class of road, and indeed the total traffic forecast is at the lower end of the range for which a two-

lane dual carriageway is appropriate.

Consequently, an additional series of computer runs was carried out in which the traffic flows were

brought near to the road's capacity by doubling them. The design data used in the earlier runs were still

applicable as the same class of road was still to be designed, so the traffic data alone of the data input to

MINERVA were modified. Some factors not represented in the program, such as standard of junction,

may have needed improvement to accommodate the increased traffic, but all of the items that affect the

optimisation process were unchanged.

In the new series of runs, values of 0.0 and 0.2 were again used for R. The optimal alignments will

be referred to as A2 and B2 respectively, and are shown in Figure 2. The various costs of A2 and B2 are

shown in Table 4a: the traffic cost of MCC has been re-evaluated with the new data.

TABLE 4a

Summary of costs with doubled traffic forecast

Alignment

MCC

A2

B2

Traffic Cost -Ramp

Cost (£)

3 229 758

2 730 044

2 707 475

Earthwork Cost (£)

1 236 188

1 394 265

1 423 391

Viaduct Cost (£)

2 049 498

2 121 432

2 126 515

Construction Cost (£)

3 285 686

3 515 697

3 549 906

Note: MCC - alignment with minimum construction cost

A2 - alignment optimised with objective function (7) and R = 0.0

B2 - alignment optimised with objective function (7) and R = 0.2

The Construction Cost does not include costs that do not depend on the vertical alignment. The Traffic and Ramp Costs are discounted over 30 years.

12

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The values of the objective function obtained with the doubled traffic forecast are shown in Table 4b,

and these show that with the higher traffic forecast the road should no longer be built to the cheapest design.

It is now desirable to invest in a more expensive road which will offer greater long-term benefits through

reduced travel costs.

T A B L E 4b

Objective function with doubled traffic forecast

MCC

Alignment optimised with particular value of R

R= 0.0

O~ective Function

6 515 444

6 245 741 (A2)

per cent of MCC value

95.86

ONective Function

7 172 581

6 967 363 (B2)

R = 0.2

I per cent of MCC value

97.14

Note: Objective Function = Traffic Cost - Ramp Cost + (1 + R). Construction Cost These costs are taken from Table 4a.

As a final proof of the economic advantage of A2 and B2 over MCC, Incremental NPV/C ratios are

calculated in Table 5. For a given value of R, a more expensive design is preferred if the ratio of the

increase in NPV to the increase in construction cost exceeds R: this is true in both cases, so that with

either value of R the alignment optimised with the new objective function is definitely superior to the

Minimum Construction Cost alignment.

TABLE 5

Incremental NPV/C ratios comparing the optimised alignments with the minimum construction cost alignment

Alignment

A2

B2

Reduction in Traffic Cost

(1)

499 414

522 283

Increase. in Construction Cost

(2)

230 011

264 220

Increase in NPV

(3) = (1) - (2)

269 703

258 063

Incremental NPV/C Ratio

= (3)/(2)

1.173

0.977

Note: The doubled traffic forecast was used during the optimisations that produced A2 and B2.

4.4 Summary of results for t i le test scheme

In Section 4.3 two series of tests were described in which the vertical alignment of a highway design,

previously optimised to minimise construction costs, was re-optimised to take account of the expected

benefits to future road users. In the first series the engineer's traffic forecast was used, which predicted

low traffic flows relative to the design capacity. These tests showed that the alignment that minimised

construction costs very nearly maximised the economic value of the road.

13

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The traffic forecast was doubled for the second series of tests, bringing the traffic flows near to the

design capacity. More expensive alignments were found which offered sufficient increases in benefits to

warrant the extra investment; these cost approximately £0.25m more to build than the cheapest alternative,

but increased the NPV by £0.25m. The values of the Incremental NPV/C Ratio were approximately 1.0,

and so the extra expenditure would be justified.

The most significant changes made by including traffic costs in the optimisation occurred between

chainages 7 000 and 12 000. This section of the route is shown in Figure 3, and the four optimised

vertical alignments are shown with the alignment which minimised construction cost. This figure shows

that as the significance of the traffic cost increases relative to the construction cost, the optimal alignment

tends to become flatter, with lower gradients and longer curves. Alignment B 1 was not shown in Figure 1

as it differs so little from the MCC alignment: these differences can be seen between chainages 9 000

and 10 200 in Figure 3.

4.5 Limits on gradient

The gradients that may be incorporated in the design of a new highway are normally subject to

nationally defined limits. The reasons for this policy include the desire for uniform design standards

throughout the highway network and the need to avoid the excessive operating costs incurred on steep

stretches of road. An alternative approach that has been suggested would include travel costs in the

design process, relying on these to reduce steep gradients to a more acceptable value.

The results from the test scheme show that the steepest gradients on a vertical alignment optimised

with an objective function that includes travel costs were not significantly lower than the values obtained

by optimising with construction cost alone. Consider, for example, the long inclines at either end of the

route. It will be recalled that the designer specified a maximum permissible gradient of 5.1 per cent, this

being slightly greater than the steepest gradient in his design, and the alignment which minimises construction

cost has a steepest gradient of 5.03 per cent. Thus the optimisation has not been affected by the limit on

gradient, and could have produced steeper gradients if this would have lowered the construction cost

further. The influence of heavy traffic reduced the steepest gradient to 4.98 per cent, and the gradient of

neither incline was reduced by more than 0.1 per cent. On the other hand,if a limit of, say, 4 per cent

had been imposed then the optimised alignment would be far more expensive to build, and the tests show

that the extra expense would not be justified by the corresponding reduction in travel costs.

This suggests that a national system of gradient limits could lead, if too strictly applied, to instances

of excessive investment in roads built to an uneconomically high standard. The inclusion of traffic costs

in vertical alignment design may not significantly lower gradients relative to the cheapest alignment but

it does provide a consistent criterion for choosing gradients which gives due weight to the interests of

road users.

4.6 The cost implications of the new objective function

The results presented above demonstrate that the construction cost of a vertical alignment optimised

with the new objective function (7) tends to be higher than for an alignment optimised to minimise construction

costs. Since the evaluation of a road scheme takes account of the traffic benefits and construction costs of

the scheme, it is perfectly possible for the alignment with the greatest economic value to be significantly

more expensive than the alignment with the minimum construction cost (MCC). However, unless the

14

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method described above has been used there is no way of knowing whether an alignment which is more

expensive than MCC is optimal, and it is quite possible that the increase in traffic benefits has been carried

too far.

Consider, for example, three vertical alignments for the by-pass scheme studied in this section.

One alignment (MCC) has been optimised to minimise the construction cost, another (!32) has been

optimised to maximise its economic value by minimising the new objective function, and a third, (D),

has been designed by manual methods and gives even lower traffic costs but is more expensive to build

than B2.

TABLE 6

Comparative costs for the three alignments

Alignment MCC B2 D

Construction Cost (£m) 3.286 3.550 3.700

Traffic Cost - Ramp Cost (£m) 3.230 2.707 2.600

Note: Costs for MCC and B2 taken from Table 4a, costs for D are hypothetical.

If B2 had not been developed, D would be compared with MCC and, since this comparison gives an

Incremental NPV/C Ratio of +0.52 using equation (6), alignment D would be preferred. However, D

actually is sub-optimal since its construction cost has risen beyond that of B2 to an extent that cannot be

justified by the increased traffic benefits. This is shown clearly when D is compared_with B2; the

Incremental NPV/C Ratio is -0.28, so that B2 - the cheaper alignment - is preferred.

In this case the existence of a scheme which is more expensive to build than MCC but does maximise

the economic value of the road has demonstrated that an even more expensive alignment is not the best

one to build.

5. CONCLUSIONS

A method has been described for designing the alignment of a new road that explicitly takes account of

the travel costs of the drivers who will use the road. Details have been given of the implementation of this

method using MINERVA, an existing computer program from the Highway Optimisation Program System

that optimises the vertical alignment. A current highway scheme passing through hilly country was studied,

and the effect of including travel costs during alignment optimisation was demonstrated. This example

showed that if the road is heavily trafficked then extra investment can be justified in order to achieve

a flatter profile and reduce travel costs. It was shown that the new method will sometimes lead to a cheaper

road than would be designed using a minimum cost criterion, since the new method is consistent with the

criterion used for comparing alternative routes for a new road.

The scheme studied provided some evidence that the current system of gradient limits on new

highways should be replaced by the inclusion of travel costs quantitatively in the design process.

15

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6. ACKNOWLEDGEMENTS

The work described in this report was carried out in the Access and Mobility Division of the Transport

Operations Department of TRRL.

7. REFERENCES

I. DEPARTMENT OF THE ENVIRONMENT, HIGHWAY ENGINEERING COMPUTER BRANCH.

Highway Optimisation Program System. London, May 1974 (Department of the Environment).

. WITHEY, K H. The optimisation of the vertical alignment of the M5 motorway from Chelston to

Blackbrook. Department of the Environment, TRRL Report LR 473. Crowthorne, 1972 (Transport

and Road Research Laboratory).

. DEPARTMENT OF THE ENVIRONMENT, HEMA DIVISION. COBA. London (Department of

the Environment).

. DAVIES, H E H. Optimising Highway Vertical alignments to minimise construction costs: Program

MINERVA. Department of the Environment, TRRL Report LR 463. Crowthorne, 1972 (Transport

and Road Research Laboratory).

5. DAVIES, H E H and J BROUGHTON. Horizontal alignment optimisation: test of program NOAH

on a motorway scheme. Department of the Environment Department of Transport, TRRL Report LR 894. Crowthorne, 1979 (Transport and Road Research Laboratory).

. TANNER, J C. Forecast of vehicles and traffic in Great Britain: 1974 revision. Department of the Environment, TRRL Report LR 650. Crowthorne, 1974 (Transport and Road Research Laboratory).

. EVERALL, P F. The effect of road and traffic conditions on fuel consumption. Ministry of Transport, RRL Report LR 226. Crowthorne, 1968 (Transport and Road Research Laboratory).

. DAWSON, R F Fand P VASS. Vehicle operating costs in 1973. Department of the Environment, TRRL Report LR 661. Crowthorne, 1974 (Transport and Road Research Laboratory).

1 6

Page 20: TRANSPORT and ROAD RESEARCH LABORATORY Department of … · a method has been devised for introducing travel costs into the alignment optimisation. This allows inter- action between

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Page 22: TRANSPORT and ROAD RESEARCH LABORATORY Department of … · a method has been devised for introducing travel costs into the alignment optimisation. This allows inter- action between

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Page 23: TRANSPORT and ROAD RESEARCH LABORATORY Department of … · a method has been devised for introducing travel costs into the alignment optimisation. This allows inter- action between

A1

A2

B1

B2

BY

BZ

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Cn

Tn

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N

NPV

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8. APPENDIX 1

NOTATION

Alignment optimised with R = 0.0 and original traffic forecast.

Alignment optimised with R = 0.0 and doubled traffic forecast.

Alignment optimised with R = 0.2 and original traffic forecast.

Alignment optimised with R = 0.2 and doubled traffic forecast.

Discounted sum of travel cost savings over original road network N.

Discounted sum of those economic benefits over new road network that are independent of the alignment.

Overall benefit of scheme n (n = s, t, u, v).

Construction cost of scheme n (n = s, t, u, v).

Traffic cost of scheme n (n = s, t).

Change in travel costs in year t, relative to year 1

Ratio of traffic flow in year t to first year flow.

Two-way flow of vehicles from class v in first year.

Growth Factor.

Inflation index between mid-1973 and date o f engineering unit rates.

Incremental NPV/C Ratio comparing two schemes.

Alignment with minimum construction cost.

Original road network.

Net Present Value of scheme.

Ratio of Net Present Value to Construction Cost.

Discount rate.

Ramp Cost - ie Traffic cost for the alignment of constant gradient joining the end-points.

First year total of travel costs (1973 prices).

Travel cost for representative of class v (1973 prices).

2 3

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9. APPENDIX 2

THE TRAFFIC COST MODEL

The Traffic Cost Model calculates the traffic cost for any alignment in two stages: firstly, the total of

travel costs in the first year of operation is estimated, and secondly this is multiplied by a growth factor

and an inflation index to give the sum of travel costs throughout the life of the road, discounted to the year of construction.

9.1 A model for calculating travel costs

The method used to calculate the total of first year travel costs is described below. It is designed to

operate rapidly, as it will be needed hundreds of times in the course of a typical optimisation, yet it takes

account of all major factors determining travel costs.

Road vehicles are divided for the purposes of the model into three categories: cars, light goods and

other goods vehicles. Public Service vehicles are not treated in the Traffic Cost Model as they will normally

form an insignificant proportion of the traffic using roads to which the Model will be applied. The Model

calculates the total of first year travel costs for each category as the product of the predicted two-way

flow in the first year and the travel cost for a representative vehicle. The travel cost is estimated from a

simulated journey along the alignment, using equations that were derived from the observations of EveraU 7

. to predict the speed and fuel consumption of the representative vehicle over short stretches of road from

the gradient and design velocity; the observations were averaged over both directions. These predictions

are converted into costs using the methods described by Dawson and Vass 8. Within the Model, travel costs

are divided into three classes: time, fuel and miscellaneous costs; the latter comprise those items, other

than fuel and vehicle occupants' time, which Dawson and Vass list as marginal travel costs. They quote

equations relating travel costs to velocity and it is these, with the fuel and time cost components removed,

that are used to predict miscellaneous costs. Values of the vehicle occupants' time and cost of fuel 8 are used to calculate time and fuel costs.

The cost calculated by the Traffic Cost Model is thus proportional to the traffic flow, and also depends

on the design velocity and vertical alignment. For a particular optimisation traffic flow and design velocity

are constant, so that the calculations are sensitive only to changes in the vertical alignment. It was, however,

observed in Section 4.2 that the traffic cost for the MCC alignment (which included gradients of 5 per cent)

was only 5 per cent greater than for the alignment of constant gradient joining the end-points, with a gradient

of 0.3 per cent. This suggests that, with gradients subject to the limits applied to English trunk roads, the

Traffic Cost Model will be far more sensitive to the overall length of a scheme than to its vertical alignment.

This is confirmed by experience 5 with the horizontal optimisation program NOAH, where the large

reductions of traffic costs achieved were attributable mainly to shortenings of the alignment.

The equations predicting vehicle performance and fuel consumption represent implicitly many aspects

of traffic flow which would be difficult to model explicitly, such as congestion. In the tests reported by

Everall 7, the drivers of the instrumented test vehicles were forced to respond to a wide range of road

conditions during their journeys: also, they were instructed to vary their driving styles between journeys.

These variations were reflected in the observations made, and thence in the equations, so that a wide range

of factors will influence the results of Traffic Cost Model without being treated specifically.

2 4

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9.2 The Growth Factor

In this section the method is described by which the traffic cost o f an alignment is calculated from the

travel costs of representative vehicles, using a growth factor which subsumes the range o f variables normally

required by this calculation.

In the previous section the estimation was described of the travel costs o f representative vehicles from

the three classes into which road vehicles are divided. Let Fv be the two-way flow of vehicles from class v

in the first year, and let the travel cost calculated by the model for the representative o f class v by Zv: this

will be at 1973 prices, so the total of first year travel costs calculated by the Traffic Cost Model at 1973

prices is:

Y = Y~ Fv . Zv V

An inflation index I is needed to account for declining values between 1973 and the design year, so that

at design year prices the total o f the first year travel costs is I.Y.

Costs and benefits for the new road must be expressed in constant prices, but it is nevertheless possible

that values for fuel and time, expressed in constant prices, will rise. For simplicity, a common rate o f change

is assumed for the three components of travel cost: if the value in year t relative to year 1,the first year o f

operation o f the road, is Dt then the travel cost for representative v in year t at design year prices is:

Dt . I . Z v . . . . . . . . . . . . . . . . . . . . . . . . . . (a l )

This simple model should be reliable for the early years, and the emphasis placed on this period by dis-

counting at the current discount rate will minimise any error. This argument applies equally to the split

of traffic between the classes in future years, which is assumed to remain constant. Thus, if Et is the total

flow in year t divided by the total flow in year 1 then the number of vehicles from class v in year t is:

E t . Fv . . . . . . . . . . . . . . . . . . . . . . . . . . (a2)

so that the total travel cost in year t is the sum over the classes v o f the product (a2) . (al) :

(Et. F v ) . ( D t . I . Z v ) = ( D t . E t . l ) . ~ Zv. Fv V V

-- D t . E t . I . Y

T, the traffic cost for the road, is the sum over the life of the road of these costs, discounted at rate r

to the year of construction:

T = E D t . E t . I . Y . ( I + r ) - t t

= I . Y . E D t . E t . ( 1 +r ) - t . t

G = ~ D t . E t . ( 1 + r ) - t t

25

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is defined to be the Growth Factor, where the summation is evaluated over the life of the road, often taken

to be thirty years. Thus the Traffic Cost Model calculates the traffic cost of an alignment from the equation:

Traffic Cost -- Growth Factor (G). Inflation Index (I) . Total of First Year Travel Costs (Y)

where G and I are specified by the user and Y is calculated by the Model from the user's first year traffic

forecast, as described in the preceding section.

Values of the Growth Factor under a wide range of forecasts are presented in Table 1, evaluated with

a discount rate of ten per cent over a period of thirty years. The small range of values demonstrates the

stability of this approach, and shows how the effect of the inherent uncertainty of traffic forecasting is

reduced by the discounting process. The user should normally be able to select a value of G from the range

indicated by Table 1, without the need for elaborate traffic forecasts.

26

(1584) Dd0536361 1,500 8/79 HPLtd So'ton G1915 P R I N T E D IN E N G L A N D

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ABSTRACT

The effect of travel costs on the design of highway alignments: J BROUGHTON BSc PhD: Department of the Environment Department of Transport, TRRL Laboratory Report 912: Crowthorne, 1979 (Transport and Road Research Laboratory). The alignment chosen for a new road will affect the travel costs of all drivers using it. In current practice, travel costs are taken into account when making an economic evaluation of a new road but are of ten not included explicitly when designing the alignment of the road. This inconsistency may lead to the construction of a new road to a design which does not represent the best balance between the costs of travel and of construction.

In this report a simple method is described for allowing the expected travel costs o f a new road to influence the design of the alignment. The conversion of an existing vertical alignment optimisation computer program to take account of travel costs is described.

The new program has been applied to a current highway scheme with a vertical align- ment that had been optimised to minimise the scheme's construction cost. The highway considered passes through hilly terrain, and it is shown that an improvement in the economic value of the scheme can be achieved by introducing travel costs into the design process.

ISSN 0305-1293

ABSTRACT

The effect of travel costs on the design of highway alignments: J BROUGHTON BSc PhD: Department of the Environment Department of Transport, T R R L Laboratory Report 912: Crowthorne, 1979 (Transport and Road Research Laboratory). The alignment chosen for a new road will affect the travel costs of all drivers using it. In current practice, travel costs are taken into account when making an economic evaluation of a new road but are often not included explicitly, when designing the alignment of the road. This inconsistency may lead to the construction of a new.road to a design which does not represent the best balance between the-costs of travel and of construction.

In this report a simple method is described for allowing the expected travel costs of a new road to influence the design of the alignment. The conversion of an existing vertical alignment optimisation computer program to take account of travel costs is described.

The new program has been applied to a current highway scheme with a vertical align- ment that had been optimised to minimise the scheme's construction cost. The highway considered passes through hilly terrain, and it is shown that an imgrovement in the ecofiomic value of the scheme can be achieved by introducing travel costs into the design process.

ISSN 0305-1293