Potential for Tram in the City of Skopje, Project Introduction

Potential for Tram in the City of Skopje,

Project Introduction

Gjorgjievski Kristijan | 13 October 2011

Developments in the past year■ December 2010 – The City of Skopje engaged Vialto Consulting and EC

Harris as consultants to do the following tasks:

– Phase I - Preparation of a Study for a concession project for development and introduction of light railway system for passenger transport in the area of the City of Skopje. The study includes:

• Traffic - technical analysis

• Economic and financial analysis

• Legal analysis

• Possibilities for development

– Phase II - Preparation of Tender Documentation and model contract, evaluation criteria and animation of potential investors;

– Phase III – Advisory in the selection process and contracting negotiations

2

3

Planned Tram Network(Feasibility Study 2007)

Line 1Line 1 alternativesLine 2Line 3Line 4

4

Estimated Passenger Flow(Peak Hour)

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Estimated Tram Passenger Flow

■ „Corridor” approach (change to tram)

– 80% of bus passengers (80 pax per bus)

– 20% of car passengers (1,5 pax per car)

■ Daily passengers assumptions

– w = 15% (peak hour factor)

– growth factor: 1% per year

– diameter shaped lines have two branches

■ Yearly passengers assumptions

– 250 workdays, 115 holidays

– holiday = 0.5 × workday

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Other Analysed Technical Issues

■ Modification of tram stop allocation

■ Track alignment (side or central)

■ Tariff system

■ Bus reorganization

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Proposed Versions

Bulit Service Journey approx

Version Service track length time peak off-peak evening service

name name length one dir. 6-8;13-17 5-6;8-13;17-20 20-23 per day

[km] [min] [min] [min] [min] [pcs]

A B C D E F G H I J

V1 Tram 1 Novo Lisice - Centar 5,7 5,7 16 6 10 10 132

V2a Tram 1 Gjorche Petrov - Novo Lisice 12,1 12,1 33 4 6 10 198

V2b Tram 1 Gjorche Petrov - Novo Lisice 12,1 12,1 33 6 6 10 168

V3 Tram 1 Gjorche Petrov - Novo Lisice 12,1 12,1 33 8 10 15 111

Tram 2 [Gjorche Petrov] - Sever 5,6 12,8 32 8 10 15 111

17,7


Tram 2 Staklarna - Sever 9,6 10,2 25 8 10 15 111

21,7


Tram 3 [Gjorche Petrov] - Agroservice 4,4 12,7 32 8 10 15 111

Tram 2 Staklarna - Sever 9,6 10,2 25 8 10 15 111

26,1

Tram lines ServicesFollow-up time

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Investments and Operational CostVersion 2a - Novo Lisice - Centar - Gjorce Petrov

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Investments and Operational CostVersion 2a - Novo Lisice - Centar - Gjorce Petrov

No. Item Unit QuantityCost

per unitTotal cost

A B C D E F1

2 Track infrastructure track km 24,2 2 000 48 4003 Catenary track km 24,2 500 12 1004 Depot (only at Novo Lisice) each 1 15 000 15 0005 Vehicles each 22 1 900 41 8006 Subtotal 1000EUR 117 3007 Technical reserve 1000EUR 10% 11 7308 Provision for inflation 1000EUR 5% 5 8659 Provision for exchange rate 1000EUR 5% 5 865

10 Total 1000EUR 140 76011

12 Vehicles running (O&M) cost* km 1 665 444 0,004 6 66213 Infrastructure maintenance track km 24,2 50 1 21014 Total per year 1000EUR 7 872

*228 runs on workdays (250 day/year), 168 runs on other days

[1000 EUR]

Investment cost

Operational cost ( per year )

Financial analysis of a possible version■ Optimum operative subsidy, with 10% initial investment

– 10 % initial investment granting

– optimum operative subsidy (to reach at least 11 % interest rate on equity and not to have negative cumulative cash-flow)

– no ticket price reduction (except for students and pensioner)

13 october 2011 |Kristijan Gjorgjievski| 10

Financial Indicators

Net present value 68.26 M Eur

Benefit – Cost Ratio(BCR) 1.217

Net discounted profit (NPV – PV of equity investment) 54.19 M Eur

Interest rate on equity 11.00 %

Total Subsidy PV 68.58 M Eur

The Study - Conclusions■ It is financially feasible to introduce the Tram as an environmentaly friendly high

capacity transport mode in the City of Skopje;

■ Among line options investigated, nr 1 proved to be most beneficial and financially feasible (12km long trunk line);

■ Later further development is possible (line 2, 3);

■ Sustainable public financing is needed

• 10 % initial investment granting

• optimal operative subsidy

■ Risks to be mitigated (cost overrun, time overrun, policy failure, car invasion).

■ Need for changes in legislation, due to a new way of transport

■ Additional measures:

1. Modification of local transport strategy.

2. Reorganisation of JSP

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Next steps

■ The city of Skopje decided to proceed with the next phase, i.e into project preparatory phase

■ Animation of possible investors and organizing round table (end of November 2011)

■ Expected tender announcement – End of January 2012


Questions ?

Thank You for Your Attention!

[email protected]

The study was prepared by

Dr. Csaba Orosz,

Dr. Janos BERÉNYI

Dr. Tibor Princz-Jakovics

Dr. Peter Bocz,

Backup slides


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PPP (DBFM) Structure

27th of June 2011 1717

Present traffic flow to the centre (morning peak hour)Тековен проток на сообраќајот во центарот car

bus

Public subsidy, Version 2a/4

15th of April 2011 18

Documents

Potential for Tram in the City of Skopje, Project Introduction