On behalf of the Ministry of Finance and Ministry of Transport and Communications, Oslo Economics has in cooperation with Terramar conducted a quality assurance of the Norwegian Public Roads Administration’s (NPRA) concept study of «Buskerudbypakke 2”.
NPRA recommends a composite concept (“sammensatt konsept”) and the highest level of a common package (“fellespakken”). The concept is claimed to have a capital cost of 22.0 billion and is in the concept study intended, for completion by 2040, to have a net benefit of 1.7 billion. Of the concepts that will be completed in 2040, the recommended concept is rated as the best on quantified effects and the fourth best in non-quantified effects. Regarding achievement of goals in the project, the concept is ranked as the third best.
Our recommendation is the reference case. According to our calculations, none of the concepts have positive net present value, and the negative net present value is not offset by non-quantified effects. The concept recommended by NPRA has an estimated investment cost of 25.3 billion including investment costs for the common package. According to our calculations, there is a negative net present value of 3.4 billion. In addition, the concept has negative impact on non-quantified effects.
Otherwise, our analysis shows that some road projects could be economically viable without tolls, and that geographically defined measures in and around the densely populated areas can be economically profitable.
Download the report here (in Norwegian).
For more information, please contact Rolf Sverre Asp.
