7.2 - Transport service user benefits

Introduction

Transport service proposals may be affected by the following factors:

• user charge levels
• quality of service to users (for example, more frequent trips, refurbishment, alternate routes, shorter trip times, etc)
• operating and maintenance costs.

The purpose of this section is to calculate the net transport service user benefits and disbenefits of a transport service proposal, where there is a change in the user charge, the quality of service or the introduction of a new service. This calculation is done for both existing and new users

Transport service user definitions

For the purpose of this analysis, transport service users are both people or freight being moved, but not people who are paying for freight to be moved.

Users of a new transport service include those who have transferred from other modes and those who are completely new trip makers (generated trips).

User benefits for freight should take into account flexibility in options for frequency of transport and choice of service providers.

User benefits for new transport service

The calculation of net benefits for users of a new transport service is based on the difference between the proposed and the maximum user charge (at which no one would use the service). The result is then divided in half, based on the rule of half.

Calculate net user benefits for users of a new transport service using the demand estimates from chapter 4.

Net user benefits = (P_max − P_new ) × Q_new × ½

where:

P_new = proposed user charge

P_max = maximum user charge

Q_new = projected number of new service users

Analysis of user benefits on existing services

The quantitative analysis of net transport service user benefits for a change in service is conducted by separating the transport service users into two categories:

• existing users
• new users.

Where an existing service is being improved, existing users receive the full benefit of the improvement, while new users are considered to receive one-half of the existing user's benefit. See 'method of evaluation' in chapter 3 for further explanation.

Where the existing transport service user may be adversely affected (disbenefit) by disruptions during construction and/or the change in demand for the new service, these effects should be taken into account in the analysis.

Rules

Net transport service user benefits must be calculated for each option where there is a change to user charge levels or the quality of service.

New transport service user benefits are calculated using the rule of half.

The user benefits measured represent the change from the do minimum.

Passenger transport user benefits

Transport service user benefits for existing passenger transport users may include, but are not limited to:

• improvements in frequency/less queuing time
• reduction in the number of interchanges or interchange time
• improvements in trip quality (ie refurbishment)
• improved travel time.

Freight transport user benefits

In general, these procedures assume that the freight owner is indifferent to modes, ie the owner is satisfied that all modes will deliver the product in the same condition and with the same reliability. In this instance, there will be no user benefits for transport service proposals involving freight movement.

Transport service user benefits for freight could include:

• differences in travel time for the freight
• changes in the service quality

particularly for goods that are perishable or fragile.

In some cases, users transferring freight from road to a transport service mode will experience reduced flexibility in the timing and route of services compared with using a roading option. Any such reduced flexibility for the transport service user shall be included as a disbenefit in evaluations.

Increased service frequency benefits

Increased service frequency may also be described as decreased waiting time, headway reduction, or less queuing time. The benefit of the headway reduction depends on the existing frequency of the service.

Calculate the service frequency benefits using chapter 4 demand estimates, as follows:

Frequency benefit per transport service user,

FB = WTf × 2 × VOT

Change in net total benefits for existing transport service users,

Bf_existing = FB × Q₁

Net total benefits for new transport service users,

Bf_new = FB × (Q_new − Q₁) × ½ (rule of half)

Total service frequency benefits,

Bf_total = Bf_existing + Bf_new

where:

Q₁ = base patronage level (existing number of users)

Q_new = projected new patronage level

WTf = wait time benefit (in minutes) from the table below

VOT = value of vehicle occupant time ($/minute) for transport service users (by trip purpose) from table A4.1 in appendix A4 (volume 1).

Using the existing headway/service frequency (in minutes), and the appropriate trip purpose from the table below, identify the benefit in minutes of wait time (WTf) for improving service frequency. If the proposed new headway/service frequency is significantly less than the existing (ie 20 minutes compared with 40 minutes) an average of the wait time benefit for the two frequencies should be used.

Benefits of eliminating interchanges between transport services

In addition to the wait and/or walk time to transfer time that applies to service frequency benefits, there is a 5 minute IVT 'interchange penalty'.

Calculate the interchange reduction benefits using chapter 4 demand estimates, as follows:

Interchange reduction benefit per transport service user,

IB = (WTi × 2 + 5) × VOT

Change in net total benefits for existing transport service users,

Bi_existing = FB × Q₁

Net total benefits for new transport service users,

Bi_new = FB × (Q_new − Q₁) × ½ (rule of half)

Total service frequency benefits,

Bi_total = Bi_existing + Bi_new

where:

Q₁ = base patronage level (existing number of users)

Q_new = projected new patronage level

WTi = existing wait and/or walking time to transfer between PT services (in minutes)

VOT = value of vehicle occupant time ($/minute) for transport service users (by trip purpose) from table A4.1 in appendix A4 (volume 1).

Other transport service user benefits

The value of transport service user benefits (other than increased service frequency, eliminating interchanges or fare changes), eg improved comfort, is usually derived from a consumer surplus measure. This may be based on a willingness-to-pay survey or on values derived for similar service improvements in other areas.

Calculate the other transport service benefits using chapter 4 demand estimates, as follows:

Change in net total benefits for existing transport service users,

Bo_existing = (P_max − P_new ) × Q₁

Net total benefits for new transport service users,

Bo_new = (P_max − P_new ) × (Q_new − Q₁) × ½ (rule of half)

Total service frequency benefits,

Bo_total = Bo_existing + Bo_new

where:

P_new = proposed average user charge (this may be different from the existing

user charge)

P_max = maximum charge users are willing to pay (WTP) for improved service

Q₁ = base patronage level (existing number of users)

Q_new = projected new patronage level

Benefits of fare changes

The benefits (or disbenefits) of fare changes are calculated the same way as above by replacing P_max with P₁, where P₁ is the existing average user charge.

Demand change impact on existing users

If there is a significant detrimental effect of the new level of demand on existing transport service users then the disbenefits to existing users should be subtracted from the total user benefits.

Possible negative effects of demand change on existing transport service users include:

• the proportion of standing passengers is increased
• the probability of being left behind has increased.

Example: Assume that the probability of being left behind has increased by 50 percent. Calculate the potential increased waiting time and multiply it by the appropriate value of vehicle occupant time (VOT) value from appendix A4 in volume 1. Multiply by the probability (50 percent) of having to wait, times the total number of existing users.