Institute of Transportation Studies at UC Berkeley

The Full Cost of Intercity Transportation Page ES-1 This study evaluates the full cost of three modes of intercity transportation: air, highway, and high speed rail. The evaluation is done within the context of the California Corridor, connecting the Los Angeles Basin and the San Francisco Bay Area. The purpose of evaluating full cost is to compare the economic implications of investment in, or expansion of, any of these three modes. The scope of the analysis is full transportation cost. Full transportation costs includes external, or social cost, in addition to the internal costs of construction, operation and maintenance. In this study we include estimates of four types of external, social costs: accidents, congestion, noise, and air pollution. The 677 kilometer corridor for which these estimates are computed represents one of the alignments of a proposed high speed rail system between Los Angeles and San Francisco. The methodology used is to construct cost functions that relate costs to levels of output, as measured by passenger-kms. or vehicle-kms. Different types of costs are estimated as permitted by available data. These include short run costs, in which the physical capacity is held fixed; and long run functions in which capacity is allowed to expand to meet higher levels of demand. Average and marginal costs are computed for highway and for air transportation. But given the absence of high speed rail systems in California only average costs are estimated. The highway and air cost models are developed from basic principles and are estimated with actual data and system design characteristics observed in the California corridor. Rail costs are estimated with models that have been adapted from estimates for the French high speed rail system, the TGV, using available data for their estimation. Based on the results summarized in Chapter 7 and shown in Table 7.1, we find that the full cost of air transportation for the California Corridor ($0.1315 per passenger-kilometer traveled (pkt)) is significantly less costly than the other two modes. The full cost of high speed rail and highway transportation cost approximately the same; rail costs $0.2350/pkt and highway costs $0.2302/pkt. The internal, or private, monetary costs comprising infrastructure, carrier, and vehicle operating costs are clearly highest for rail ($0.19/pkt), followed by air ($0.11/pkt) and then highway ($0.10/pkt). And as is to be expected, user time costs are highest for the slowest mode, the highway system, followed by rail and then air. Adding user travel time costs to the monetary costs results in the total internal system costs per passenger-km. of $0.124 for air; $0.233 for rail; and $0.198 for highway. In other words, if we disregard external costs then we find that high speed rail is nearly twice as costly as air and that the highway is not far behind. However, if we look at social costs alone -- congestion, air pollution, noise, and accidents -- we find that high speed rail is clearly less costly than the other modes. In this research the only measurable social cost of high speed rail is that of noise, which at $0.002/pkt, is significantly lower than that of air at $0.0043/pkt and highway at $0.0045/pkt. Highway transportation, on the other hand, has a relatively high cost in terms of air pollution and accidents, two externalities which are virtually absent in high speed rail. In this study, we consider that the pollution resulting from the electric power generation used to drive a train is to be allocated to the energy, and not the transportation sector. Thus, any pollution externality associated with high speed rail should be already internalized in a higher price for electricity. Similarly, a 100% safe system, such as high speed rail, implies higher capital costs due to construction of grade separations, more intelligent systems, etc... Hence, the avoidance of accidents by high speed trains is not "free". Therefore, high speed rail, while more costly than highway transportation in terms of internal costs, primarily due to its high capital cost, is significantly less costly than highway in terms of social costs. This comparison is illustrated in the following figure, where full costs are broken down into three categories: internal, travel time, and external.