European Transport Policies Paolo Beria Document Analysis

09/11/2010
European Transport Policies Paolo Beria
Ho paura che la Francia ci scippi il corridoio per lEuropa. Sarebbe un vero disastro, perch unopera indispensabile per leconomia di tutto il Nord Italia. Se possibile, ancora pi urgente della Torino-Lione [].
European transport policies Paolo Beria
Assessore ai Trasporti del Piemonte, parlando del Terzo Valico. La Stampa, 7 settembre 2009.
Course of Integrazione europea e politiche urbane. Milan, November 10th 2010.
contents
Competition between countries? What is a corridor?
Ho paura che la Francia ci scippi il corridoio per lEuropa. Sarebbe un vero disastro, perch unopera indispensabile per leconomia di tutto il Nord Italia. Se possibile, ancora pi urgente della Torino-Lione [].
Assessore ai Trasporti del Piemonte, parlando del Terzo Valico. La Stampa, 7 settembre 2009.
Pillars and context of EU transport policy Context 1. Infrastructures and corridors 2. Liberalisation Comments: a partial failure. Why?
Physical infrastructures or policies?
Who assesses the usefulness?
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Pillars of EU transport policy The tools of European planning

EC document COM (79) 550 Categories of investment supported: bottlenecks removal, improvement of international links between urban centres, connect peripheral regions, enhance links with NMS, overcome natural obstacles by fixed links construction, missing links. The focus on other aspects of transport, such as liberalisation, comes later.

White book (1992) New objectives of European transport policy rise: support to Single Market; network integration through interconnection and interoperability; integrate peripheral regions and third countries into continental network; transport safety; sustainable mobility; promote the open use of network through pricing; transport services market liberalisation.

Christophersen report (1996) For the first time a list of 14 priority projects is defined. The list will became the core of the TEN-T programme. Some criteria are established to define a project as priority: European interest; continental dimension: large compared to States; socio-economic profitability; suitable for private investment; mature projects; avoid public investment distorting competition; respectful of Community laws, especially environmental.

White book (2001) Actions (very generic and political goals): re-launch rail transport; improve quality of road transport; promote sea and inland waterway transport; harmonise air transport growth with environmental concern; realise intermodality; implement a trans-European network; reinforce road safety; decide for an effective pricing policy; acknowledge duties and rights of passengers; use technology to make transport cleaner and more efficient; manage globalisation
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Van Miert report (2003) High level report to study why some of 1996 priority projects did not come to an end. Introduction of a new, transparent and rigorous, approach to select projects. New priority projects list.
Pillars of EU transport policy What is EU transport planning?

Infrastructure planning is mainly a national issue. Nevertheless, infrastructures are central in European transport policy since the beginning. European transport policy main focuses/fields are: Infrastructures / Networks; Market liberalisation; Sustainability / Environment. An important, cross border theme, is that of social marginal pricing. European financial effort is limited (with the exclusion of Cohesion funds).

White books and other position documents Research and study Agreements and plans TEN-T The concept of transport corridor Directives Co-Funding TEN-T ERDF and Cohesion fund
Pillars of EU transport policy The economic effort

European funds
European funds M TEN budget Cohesion funds EIB loans EIF guarantees ISPA ERDF (estimated) Total EU contribution TOTAL cost Approximate share of EU funds 1995-1999 1.785 8.000 20-25.000 10.000 Approx. 45.000 166.000 34% 2000-2001 1.143 2.605 9.171 117 Approx. 13.000 2002-2003 1.190 3.030 11.989 1.063 1.000 18.272 82.300 22%
Source: elaboration of Turr (1999); European Commission (2004); European Commission (2007).
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Pillars of EU transport policy The economic effort

European funds
contents
Source: European Commission (2005).

Course of Integrazione europea e politiche urbane. Milan, November 10th 2010. Course of Integrazione europea e politiche urbane. Milan, November 10th 2010.
Context Modal share
Context Demand in Italy

Passengers transport
Car remains the dominant mode. Buses are relevant, even more than rail transport.
M pkm
800.000 700.000 600.000 500.000 400.000 300.000 200.000
Ripartizione modale Italia 1970 - 2001
Source: TERM, 2009. EEA Report 2/2010

100.000 0
1970
1972
1974
1976
1978
1980
1982
1984
1986
1988
1990
1992
1994
1996
1998
ferrovie autobus lunga percorrenza e noleggio

autovetture e motocicli trasporto pubblico locale (escluse ferrovie)

2000
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Context Demand motorisation index

Italy has one of the highest rate of car per inhabitants: every 1000 people, 598 cars!
Context Where is the demand?
Source: EU Transport in figures 2009
Source: TEN-CONNECT
Source: TEN-CONNECT
Source: TEN-CONNECT
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Context long vs. short distance

Few examples of actual saturation of disposable capacity, usually in urban contexts.
Source: Eddington (2006)


Source: TEN-CONNECT
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Context Is this planning?
contents
Pillars and context of EU transport policy Context 1. Infrastructures and corridors

Source: TENCONNECT
2. Liberalisation Comments: a partial failure. Why?
Infrastructures and corridors 1 pillar: infrastructures

One of the three pillars of EU transport policies is that of infrastructures. European Union becomes the promoter of investments on the physical level of transport infrastructures, also to support other policies (sustainability, liberalisation). The EU dimension is giving a value added on those links, usually international, that single states are not really focusing on: without an EU push, some missing links would not be developed. Together, EU focuses on technological aspects (e.g. rail standards, single European sky). The concept of transport corridor develops
Infrastructures and corridors 1 pillar: infrastructures

1. promotion of interoperability 2. normative simplification 3. co-financing and co-planning of some networks Transport corridors, TEN (planning) TEN-T funds, cohesion fund, etc. (financing)
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Infrastructures and corridors Interoperability

Every State has its own standards, both technological and normative. The overcoming of such differences is at the basis of physical integration. ROAD: easy interoperability (need to homogenise norms, some tech equipments, pricing); RAIL: huge problems for interoperability, networks are nearly completely different with regards to every relevant aspect (norms, gauge, power, signalling) AIR: already standardised worldwide, but imperfect integration among Air Traffic Control
Infrastructures and corridors Interoperability - Rail

Rail interoperability means that trains can operate on different national networks. In the XIX Century, every train was able to travel on the entire continental network. In the XX Century, with electric traction and with modern signalling, every country started differentiating (also for war reasons). Now, often, international train must change locomotives and crew at borders! UE issued two directives (96/48/EC e 2001/16/EC) to make the EU network newly interoperable. To push interoperability, an agency has been created: European Railway Agency (EC Regulation No 881/2004)

Rail power standards in Europe solution: multi-power locomotives

Circulation rules and tech equipments are different. Solution: The definition of one single and common signalling and train control system. ERTMS. Good but very expensive!!! ERTMS
European Rail Traffic Management System
Siemens E189 Works with: 3 kV c.c. (I, NL, POL) 15 kV / 16,7 Hz c.a. (D, CH, A) 25 kV / 50 Hz c.a. (F, high speed standard)
Fonte: www.bueker.net/trainspotting
ETCS
European Train Control System
GSM-R
New communication protocol (voice and data)
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Infrastructures and corridors The concept of transport corridor

Now called priority axes. The former idea was to provide a continuous transport (road and rail) network for the continent... - homogeneous - high quality - lesser barriers where concentrate the international flows.

How to obtain such network? connection of existing networks; removal of normative barriers (borders, customs,) removal of technological differences; removal of bottlenecks, especially at borders; where needed: new networks/infrastructures.
Source: TEN TEA (2010).


Where is the advantage of having a (freight) corridor? - More permeability more efficiency of firms and positive effects on economy. This relationship and the extent of the effect compared to costs must be demonstrated case by case! - moreover, transit is not an advantage! Why Italy should benefit from the passage of Spanish goods towards Slovenia? - weak economies may even suffer from accessibility: easier to import goods instead of producing them.
Then, at a certain point, the corridor became a synonym of (big) infrastructure see conclusions!
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Infrastructures and corridors The viewpoint of an operator
Infrastructures and corridors The viewpoint of an operator
Not only infrastructures!
Infrastructure + rules + organisation
Certainly not a problem of infrastructure!!!
contents
Liberalisation 2nd pillar: promotion of the market

The second pillar of EU transport policies is that of market liberalisation.
It starts from the concepts of regulation: state provision of services is usually inefficient. Market can promote efficiency; natural monopolies (like infrastructures) must be regulated in order not to become monopolies de facto and exploit market power; infrastructures and monopolies in general can be use to prevent market entry. Conditions must be ensured to promote competition; the potential role of private capitals to finance infrastructures must be regulated.
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Liberalisation 2nd pillar: promotion of the market

European Commission started a group of policies to liberalise transport sector as much as possible, without compromising the sociality of services (rather reinforcing it). separation of services from networks; promote the institution of regulatory bodies inside countries (antitrust & authorities); implement packages of liberalisation measures
Liberalisation Basics of rail liberalisation

National railways Traditional model Vertically integrated monopoly services infrastructure State firm managing both infrastructures and services The access to other railway undertakers is allowed only with agreements with national rail (typically for the international services)
monopoly (statutory) Only one provider per country for freight and pax services
Unregulated natural monopoly
Liberalisation Basics of rail liberalisation

Model by Directive 91/440 Rail sector Railway undertakings Competition in the market or regulation Infrastructure manager Abolition of vertically integrated monopoly Separation of services from infrastructure access tolls Development of competition in the market due to new operators entrance Not applied to local railways (e.g. FerrovieNord Milano)
Liberalisation Effects of rail liberalisation

Rail liberalisation is not yet complete and under revision. However, some important modifications have been introduced since 1991 directive. States implemented the general principles in their laws (e.g. frmal separation of network and services), but often it is not sufficiently effective or done only formally. Outcomes: Freight: more developed, from 5% to 20% or more of newcomers. Long distance passengers: no significant entries. Regional passengers: some countries good entrance, some other nothing.
Regulation of the natural monopoly or privatisation
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Liberalisation Effects of rail liberalisation

Why? Many barriers to entrance of newcomers in rail market still exist and often are reinforced by States will to protect the incumbent: technological barriers (signalling systems, ...); cross subsidisation among services ; assets to services incumbents (maintenance yards, stations,...); non substantial separation (conflict of interest between infrastructure and incumbent services provider).
Liberalisation Basics of air liberalisation

Air sector is already separated in independent parts: infrastructure (airports) and services (airlines). EU implemented liberalisation in three packages: 1987: more open fares regime, market opening for non-flag carriers, abandon of capacity allocation with bilateral agreements. 1990: removal of fares control, of capacity limitations and barriers to market entry. Third and fourth freedom on EU routes. 1993: Continental market as a domestic market (open skies). All 8 freedoms of air. Intercontinental remains ruled by bilateral agreements. 2008: Open sky on north Atlantic routes.
Also: nothing is said on the regulation of infrastructures...


Freedoms of air are 8 levels of flight rights that norm services between couples of destinations in different countries or supplied by foreign carriers. Example:
A B A B

Product substitutability Air transport services Absence of sunk costs Mobility of production factors Legal monopoly. Possible competition among near airports Competition in the market
A: country of the aircraft

C C
8 - cabotage
Air transport
5
A B
6
A B
Airports
C
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Competition in the market for intra EEA routes (reg. 2408/92)
Liberalisation Effects of air liberalisation

The actual economic asset of air transport system is rather coherent with legal framework and results in terms of liberalisation are evident. Only some problems remain: Good level of competition in the market for intra-EEA routes, with some limitations due to the difficulty/impossibility of obtaining slots in airports with constrained supply Possible monopoly rents in extra-EEA routes (competition is possible only via third airports) Presence of cartels (IATA) among operators still effective in distorting the market and limit competition.
Air transport services
Bilateral agreements or open skies on extra-EEA routes Public service obligations on specific routes (reg. 2408/92)
Air transport
Slot allocation according to grandfather rights principle (reg. 04/793)
Airports
Competition in the market for handling service (dir CE 96/67)
Liberalisation Effects of air liberalisation

Hard competition exist in some markets benefits for users. Italy is one of the most liberalised countries (no dominant airline...)
contents
1 2
Pillars and context of EU transport policy Context 1. Infrastructures and corridors
3 4 5
2. Liberalisation Comments: a partial failure. Why?
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Comments: a partial failure Other policies

Environment sustainability Promotion of public rail electric transport instead of road transport. Soft policies to reduce drivership. Prohibitions, pollution control, etc. Environmental pricing polluters pay principle. Relationship with land use. Pricing Social marginal cost pricing principle. Eurovignette.

Single European Sky
http://www.eurocontrol.int/statfor/public/faq/faq.html

Single European Sky
Comments: a partial failure Relationships among policies

Interoperability, open access, sufficient capacity Focus on rail vs. air & road
Theoretical fuel savings: approx 15%. Real fuel savings expected: approx 5-10%
Infrastructural policy
Social marginal cost pricing Infrastructures and development
Environmental policy
Polluters pay principle
Liberalisation policy
Reduction of welfare losses
Efficiency
Pricing policy
Efficiency
Non-discriminatory pricing
General goals: cohesion, economic development, etc.

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Comments: a partial failure Failure: the concept of transport corridor

A dangerous short-circuit occurred in the infrastructural policy.
Corridor as a privileged path for international flows Removal of bottlenecks, building of missing links Corridor as a (rail) megaproject

Why? Why did EU focus on such expensive infrastructural policy instead of other softer & effective policies (and more suitable to EU dimension & powers)? Since the White Book (1992) the infrastructural policy benefited of a large political consensus. Other actions, much less expensive, never reached an agreement and their application is still far from being completed. Example: transport liberalisation.
Corridor as a connection of existing lines without barriers
Corridor as a key continental connection
Corridor as high speed rail line
Infrastructure planning policy is not touching the delicate domestic equilibriums among operators and stakeholders!

Moreover, state aids to industry was banned, in order to stimulate competition among countries and prevent distortions. Many national industries, usually inefficient and incapable to survive true competition, are on the edge of bankruptcy. The infrastructural policy (i.e. usually large rail infrastructures) was the perfect way to continue in financing national industry in difficulty: infrastructures are built by big industrial groups in difficulty (FIAT in Italy, for example). rail system needs important technological ancillary systems (signalling, trains, etc.) that can be produced by national industries (e.g. Ansaldo Breda in Italy)
Comments: a partial failure Accessibility and gaps

One of the preferred policies deal with the provision of highest and homogeneous accessibility to European territory and especially to main cities&regions. Often accessibility is (incorrectly) intended as land accessibility (i.e. without air). Moreover, the definition of accessibility is not univocal.
On the basis of the accessibility, some regions claim to have an accessibility gap and require more infrastructures. Is the accessibility gap something real? What is the right stock of infrastructures????
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Further problem: is the infrastructure stock significant w. respect to economic development?

Further problem: is the infrastructure stock significant w. respect to economic development?
Source: elab on ESPON (2009)

Source: ESPON (2009)


The concepts of accessibility and of gap are not as obvious as it seems: more accessibility does not always match with economic development; moreover, increasing the accessibility, does not necessarily mean to promote economic development (huge debate in literature); accessibility measures are questionable and usually not homogeneous; different is the goal to provide basic connections to remote regions (e.g. Central/Western Europe);
Comments: a partial failure Conclusions

What happened? Infrastructural policies (huge investments instead of policy measures) were preferred by national states, that pay 80-90% of projects but that use such money as state aid to industry.
Liberalisation, especially in rail sector, found strong opposition by states under the pressure of national (rail) agencies. But in air market had extraordinary success and impacts.
Pricing policies are difficult to implement and slowly moving.
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Concluding remarks and directions/1 a. The liberalisation policy can be seen as an important, despite partial, success. Air sector liberalisation was extremely effective. Rail liberalisation is still in cradle. b. The infrastructural policy is dominated by huge industrial interests, capable of distorting it and changing it. EU should not focus on big infrastructures, especially HST, but on technological aspects, plus some local bottleneck solutions. Facilitate cross-border links but demand is still national. c. European Commission is now conscious of the failure of the infrastructural goal. Currently the TEN-T policy is under revision (Green paper, Mid-term ex-post)

Concluding remarks and directions/2 d. Accessibility effects on development remain an undemonstrated chimera and a far-reaching goal. The true accessibility to European land resulted to be by air, also thanks to low-cost and liberalisation in general. e. The idea that High Speed Trains are environmentally friendly is naive and hide the interests of builders and manufacturers. Air sector improved significantly also in the environmental field, have no impact on landscape (as huge HS projects) and is at no cost for the states. f. Pricing policies can be an interesting field, but still not yet fully implemented.
thank you for your attention!!!
paolo.beria@polimi.it
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European Transport Policies Paolo Beria Document Analysis

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09/11/2010

European Transport Policies Paolo Beria

European Transport Policies Paolo Beria

European transport policies Paolo Beria

Course of Integrazione europea e politiche urbane. Milan, November 10th 2010.

Course of Integrazione europea e politiche urbane. Milan, November 10th 2010.

European Transport Policies Paolo Beria

European Transport Policies Paolo Beria

Physical infrastructures or policies?

Who assesses the usefulness?

Course of Integrazione europea e politiche urbane. Milan, November 10th 2010.

Course of Integrazione europea e politiche urbane. Milan, November 10th 2010.

European Transport Policies Paolo Beria

European Transport Policies Paolo Beria

Pillars of EU transport policy The tools of European planning

Pillars of EU transport policy The tools of European planning

European Transport Policies Paolo Beria

European Transport Policies Paolo Beria

Pillars of EU transport policy The tools of European planning

Pillars of EU transport policy The tools of European planning

European Transport Policies Paolo Beria

European Transport Policies Paolo Beria

Pillars of EU transport policy The tools of European planning

Pillars of EU transport policy What is EU transport planning?

Course of Integrazione europea e politiche urbane. Milan, November 10th 2010.

Course of Integrazione europea e politiche urbane. Milan, November 10th 2010.

European Transport Policies Paolo Beria

European Transport Policies Paolo Beria

Pillars of EU transport policy The tools of European planning

Pillars of EU transport policy The economic effort

European Transport Policies Paolo Beria

European Transport Policies Paolo Beria

Pillars of EU transport policy The economic effort

Source: European Commission (2005).

European Transport Policies Paolo Beria

European Transport Policies Paolo Beria

Context Modal share

Context Demand in Italy

Ripartizione modale Italia 1970 - 2001

Source: TERM, 2009. EEA Report 2/2010

ferrovie autobus lunga percorrenza e noleggio

autovetture e motocicli trasporto pubblico locale (escluse ferrovie)

European Transport Policies Paolo Beria

European Transport Policies Paolo Beria

Context Demand motorisation index

Context Where is the demand?

Source: EU Transport in figures 2009

Course of Integrazione europea e politiche urbane. Milan, November 10th 2010.

Course of Integrazione europea e politiche urbane. Milan, November 10th 2010.

European Transport Policies Paolo Beria

European Transport Policies Paolo Beria

Context Where is the demand?

Context Where is the demand?

Course of Integrazione europea e politiche urbane. Milan, November 10th 2010.

Course of Integrazione europea e politiche urbane. Milan, November 10th 2010.

European Transport Policies Paolo Beria

European Transport Policies Paolo Beria

Context long vs. short distance

Context long vs. short distance

Source: Eddington (2006)

Source: Eddington (2006)

European Transport Policies Paolo Beria

European Transport Policies Paolo Beria