Jan Anne Annema

Evaluating Transport Infrastructure Investments: The Dutch Experience with a Standardized Approach

Abstract The Dutch government introduced a requirement in 2000 to evaluate proposed major infrastructure plans using a cost–benefit analysis (CBA) following published guidelines. Since then 13 new major infrastructure projects have been evaluated. The paper reviews the Dutch standardized CBA practice since 2000. The overall conclusion is that the use of standardized CBA has improved the quality of ex‐ante evaluations of large infrastructure projects in the Netherlands. However, the relatively young CBA practice has not yet fulfilled its full potential. About half of the CBAs analysed can be considered as being suitable for helping decision‐making. The other half has weaknesses with respect to methods and assumptions. Looking at the standardized CBA’s influence on policy‐making, the most important conclusion is that unfavourable CBA results have contributed to the postponement of decisions and to the downsizing of projects.

The History of the Transport Future—Evaluating Dutch Transport Scenarios of the Past

Abstract This paper examines 42 business‐as‐usual (BAU) scenarios for future transport and traffic development in the Netherlands from the period 1970 to 2000. An important aspect of these scenarios is that they indicate the potential future state of the transport system if the policies in place at the time continue unchanged, thus raising issues which may require a policy response. This paper shows that in most of the important BAU transport scenario results of the past in the Netherlands, such as future car use and transport emissions, the policy makers were not misled. The prognoses for traffic congestion are an important exception as they underestimated the congestion problems that would arise. This paper shows that, based on the research it examines, BAU transport forecasting is an inaccurate practice. It is recommended that the BAU scenario designer communicates this high inaccuracy, enabling the policy maker to include the inherent future uncertainty in their decision‐making.

How to Build Major Transport Infrastructure Projects within Budget, in Time and with the Expected Output; a Literature Review

This paper reviews the literature on factors which help to realise major transport infrastructure projects within the forecasted budget, schedule and with the expected output. The most mentioned factors overall are as follows: (1) improving the cost and benefit estimates of projects, (2) containing the risks involved in these projects, (3) increasing accountability and (4) maintaining clear scope and objectives. Statistical research, in particular, focuses on these particular factors, but different research methodologies produce different results. Research based on case studies and interviews does not discuss accountability at all, while literature reviews and discussions show a remarkable focus on this specific factor. Furthermore, there is variety in the factors mentioned in papers investigating cost overruns, schedule overruns or output shortfalls. Overall, the research in this field focuses on failure within major transport infrastructure projects. These results show that a framework for building major transport infrastructure projects within budget, in time and with the expected output is emerging, but that more research is needed using multivariate analyses. Also, more research focusing on projects which have actually achieved their forecasts is needed.

Evaluation of dutch public investment plans

Abstract This article describes a pragmatic method recently used in The Netherlands to evaluate public investments plans. Using this method, very different kinds of investment plans were evaluated for economic, social, and ecological impacts, and direct links were made with a policy-making process. The research institutes involved were asked to develop a general appraisal method on the basis of which they would rank the investment proposals. All the plans were labeled as (a) “a solid plan,” (b) “possibly a solid plan but requiring improvements” (upgradable), or (c) “a weak plan.” The research institutes also were asked to estimate the effects of combining investment plans with complementary policy instruments like regulations and/or pricing instruments. Along with the method, options for its improvement will be discussed.

Transport and the environment : the contribution of national and local policies

Transport is by far the most important sector for NOx emissions in the Netherlands, accounting for a share of about 60% in 2020, while the share of N2O emissions from transport is much lower: about 10% to 15%. This paper documents transport forecasts (volumes, energy use, emissions) for three macro-economic and two policy scenarios (conventional solutions, liveable cities) for the 1995–2020 period. Both national and local policies for transport volumes and (NOx) emissions, along with their effects, are described. National policies include (EU) regulations for vehicles and fuels, pricing policy, public transport policies and national guidelines for policies on parking and land use. The most important local policies are those for parking, land use, cycling and restrictions for motorised vehicles.

The practice of valuing the environment in cost-benefit analyses in transport and spatial projects

Scientific debates on environmental impacts in cost-benefit analysis (CBA) focus on methodological questions. The literature, however, contains very little information on the influence of these debates on CBAs made in spatial planning practice. In this paper, this gap is filled by a qualitative analysis of 67 CBAs made in the Netherlands between 2000 and 2011. From the literature on environmental valuation, we derive criteria to evaluate the quality of CBA practice, such as completeness and the inclusion of uncertainties. The analysis shows that in many cases relevant environmental effects are omitted or not monetised. Moreover, non-monetised effects are often not included in CBA conclusions. If impacts are monetised, the methods used are frequently not very sophisticated. The consequences of assumptions are often not communicated, for example, where high discount rates make long-term effects seem unimportant. In this research we identify four main points for good practice.

Investment appraisal for sustainable ports

The sustainable development of a port is of vital economic and financial importance. Flexible designs and innovative solutions help to advance sustainability goals by addressing future uncertainty and risk. Lack of a suitable decision-making procedure or improper utilization of the standard analytical and evaluation techniques should not be allowed to stand in the way of flexibility. This paper illustrates how investment appraisal procedure in the port sector (or other infrastructure sectors) can be adapted, so that flexibility and sustainability considerations are integrated in the standard procedures, through a case study of Port of Rotterdam.

Real Options for port infrastructure investments

Ports are a vital part of the maritime transportation system. The urgent need for redevelopment of older ports and investments in port expansions, and the dilemma of a long payback time etched with uncertainty calls for new strategies. Flexibilities in a (real) system, that enable it to change according to the future that unfolds, are known as real options. An evaluation technique, commonly known as Real Options Analysis, can be applied to value flexibility during project appraisal. This can improve decision-making related to port investments and asset management.