ARCHIVESHISTORIQUES
DELACOMMISSION
COLLECTION RELIEEDES
DOCUMENTS "COM"
COM(82)807
Vol.1982/0244

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COMMISSION OFTHEEUROPEAN COMMUNITIES
COM(82)807 final
Brussels-7December 1982
ReportfromtheCommission totheCouncil
TheCommunityInterestofTransportInfrastructure Investments :
practicalexperience "withtheevaluation methodology
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C0MC82)807final

TheCommunityInterestofTransportInfrastructure Investment a:
practicalexperience -withtheevaluationmethodology
Summary
1,TheresultsoftestsofthemethodologytoevaluatetheCommunity
interestoftransportinfrastructureprojects^aredescribedinthisreport,
YJorkingwiththeTransportInfrastructure Committee,usingtheresultsof
theCommission'sstudyprogramme,anumberofmajorprojectswereevaluatedand
theresultsassessed.Thereportopenswithalistoftheprojectsand"brief
commentsontheapproachadopted.Duetotimeconstraints arangeofprojects
couldnotbeexaminedhencethetestsconcernprojectswhicharebothofhigh
costandconsiderablegeneralimportance (paras.2.1.-2.2.).Asthe
methodology hasbeenfullydescribedinthedocumentnotedaboveitisonly
brieflysetouthere(paras.3.1.-3.4»).Inessencethemethodologyhasbeen
tailoredtomakefulluseofthematerialnormallyavailableandtobear
particularly upontheCommunitydecisionmakingprocess.A"checklist"to
helpapplythemethodologyhasbeenprepared(paras.4.1•-4*6.and
particularly AnnexI).Althoughtheuseofthe"checklist"isrecommended
thisadviceispurelydiscretionary .Untilsuchtimeasitispossibleto
applythe"checklist"toawiderangeofprojectsnofirmrecommendations
onitsusecanbemade.Theresultsproducedbytheapplication ofthe
methodology canbepresentedtoadvantageintheformofauniform"Statement"
(paras.-5»3.andAnnexII).Thisstatementwoulddisplayinasimple
butclearwaythemajorelementsofaprojectandgiveprominancetofactors
ofspecialimportancetotheCommunity.
2.Theprojectsusedforthetestwere:-
-afixedlinkcrossingoftheChannelbetweenPranceandtheUK,
-afixedlinkcrossingbetweenmainlandItalyandSicilyacrosstheMessina
Straits,
-variousschemesfornewAlpinerailtunnels.
^ThemethodologywasdescribedinCOM(8l)507Pinalofl6thSept.1981

Theprojectsare"brieflydescribed(paras,6.1.–6.3.).Theresultsofthe
evaluationmethodologyaresetoutinseparate"statements"(AnnexII,
Statements 1-3).Theimplications ofthe"Statements"fortheCommunity
areexplored(para.s.7«1«-7«5«)«TheCommunityinterestfactorsare
demonstrated ,andalthoughtheseareonlypilotprojectswithnocommitment
attachedtothem,anumberofconclusions areputforwardtoillustrate
theadvicethatmightbeofferedinactualcases.Themethodologyis
consideredtobeapplicableinthesetestcases.However,acompletejudgment
ofitsapplicability willhavetobedeferreduntilithasbenefitted from
progressive approachtoitsapplication .Onthebaai;3ofthesefirst
resultsitcanbeconcludedthat
–themethodology canproduceausefulguidetotheidentification of
Communityinterest;
-aprogressive development andrefinement programmeshouldbeundertaken
toincreasethescopeofthemethodology andharmoniseitsapplication .
G
O0

Introduction
1.1 TheCouncilofMinistersmeetingonDecember15th19ol
approvedaResolutionsettingoutaprogrammeforthecontinued
consideration oftheproposedRegulation onfinancialassistance
fortransportinfrastructure (l).Onepartoftheprogrammewas
tobeapracticaltestofthemethodology fortheevaluationof
CommunityinterestsetoutinDoc.COM8l507(Final).
(TheCouncil)
"-askstheCommission ,incollaboration withtheTransportInfrastructure
Committee,toapplyonanexperimental basisthemethodsof
appraisingCommunityinterestininfrastructure projects
recommended intheReportonthecriteriafortheevaluation
ofprojectsofCommunityinteresttoalimitednumberof
specificprojectsandrequeststheCommissiontosubmitits
conclusions onthisworkbyOctober1982
Theobjectofthispaperisthusclear.The
methodology assetoutintheCommission'sproposalappeared
acceptableintheorybutneededtobetestedonanumberof
actualproposalstoensurethatitworks.
1.2 Beforeoutliningtheresultsoftheteststhathave
beenundertakenitmaybeusefultobrieflyrecalltheprincipal
pointsoftheproposedmethodology forevaluationofCommunity
interest.Theessentialstartingpointfortheevaluationis
theevaluationundertaken bythecountryorothersponsoring body
concerned.However,differentideasconcerningthevaluestoassignto
factorsinnationalevaluations openthepossibilitythatprojectsarenot
rankedequallybyindividualnationalmethods.Inthelongtermthisproblem
canbetackledbyadoptingcommonideasonvaluestoadopt}intheshortterm
sensitivityanalysiscanbeusedtoexploretheimportanceofdifferent
values.Themajorfactorssubjecttosensitivtytestswillbescenarioelements
likegrowthofGfNP.,valuesoffactorsliketimeandthediscountrateused.
This"extended"cost/benefitstudyisthencapableofprovidingacomprehensive
review,evenifnotquantifiedinallrespects,fordecisionmakingonthe
Communityinterestofprojects(its"Communityinterest").Thisapproachis
expresslydesignedto"beflexibleandnottoinvolveconsiderable extrawork
onthepartofsponsors.
(l)COM(76)336finalOJC207.2.9.1976.

-4-
The "Guidelines "forevaluation ofCommunity interest ,set outinsection 4,
aim tobalance theneed toensure that the Community institutions receive
sufficient information tocome toaclear decision against theneed toavoid
non-cost /effective work which serves little real purpose .
The Approach Adopted
2.1 . Anumber ofways were open tomeet theCouncil remit .One approach
was toselect arepresentative sample ofprojects ofvarying size ,concerning
different modes ,various regions etc .and toapply themethodology .However ,
despite theobvious merits ofthis approach ,inpractice ithad toberuled ,
out onthe grounds ofthe limited time available .Having ruled outthis
approach asimpractical ,attention was concentrated ontheprojects which
theCommission wasalready examining initsresearch programme .TheCommission 's
programme has been setup toovercome theproblem oflack ofdata and
information ontransport problems atthe Community level .Anelement ofthe
programme hasbeen teexamination ofways todevelop amethodology forthe
evaluation ofCommunity interest .This work hasprogressed tothe stage that
information wasavailable onprojects forthree major schemes :
first :afixed link crossing ofthe Channel from Prance totheUK
second ;afixed link between Sicilia and the Italian mainland
third :anewrailway tunnel through theAlps .
Although these studies were not intended tobeevaluations ofthe
projects concerned ,theresults aremost useful asasource forthis report .In
the circumstances they represented the beBt available material and justify
theattention paid tothis subject intheCommission 'sresearch programme .
2.2 . Before continuing itshould bementioned that theIrish representatives
ontheInfrastructure Committee were ready toputforward aroad scheme ofa
smaller size than these projects .Although such aproject would certainly have
been interesting toconsider ithad toberuled outfrom the current exercise
ontime grounds .The consequent lack ofscope inthe coverage ofprojects
implies that themethodology will need further testing inthis different size
range .

-5-
TheBasis for aCommunity Interest Evaluation
3.1 . Anearlier Commission paper tothe Council (1)has set
out theprincipal elements ofaCommunity interest evaluation .
Themain points oftheapproach have been recalled inpara 1.2
above .However ,itisnecessary here togointo further detail
inorder togive some background tothedevelopment oftheguidelines
for evaluation set out inthe next section .
3.2 The role ofaneconomic evaluation inadecision -
making process isnot toreplace the decision maker but rather
toclarify and facilitate the process ofmaking the final
decision .Atthelevel oftheCommunity itisobviously illusory
toexpect economic evaluation todomore than
reduce the uncertainty and refine the choices that are available .
Having made this simple but important point the need for
consistent and clear economic advice onthemerits ofaproject
forCommunity support should not beunderestimated .Throughout the
Community considerable progress hasbeen achieved inquantifying
themany factors that have tobeconsidered inevaluation
without ,however ,arriving atatotal quantification .This implies
that considerable scope for judgement exists and innoway are
decisions "canalised "along rigid lines .
3.3 Member States have made considerable progress with
the development ofevaluation techniques .Under the combined
pressure ofincreasingly scarce public resources and the need to
take proper account ofthe impact ofmajor projects upon the
environment etc .comprehensive methods ofanalysing costs /benefits
have been prepared .TheCommission 'sproposals take account of .these
developments and add tothenational approach anumber offactors
ofimportance for the Community inorder tohave acomprehensive
picture ofthe Community situation .Theprincipal element ofany
transport project that isopen toquantification inmoney terms
are time savings topassengers and also tofreight .All attempts
atevaluation now include anestimate oftime savings .This
estimate can bewidened toinclude anybenefits that occur
across the national frontier and itcan also berefined toshow
how the benefits are distributed between countries .
(l)op.cit .para 1.1 .

-6-
3.H Building upfrom national evaluations isnot the complete
answer .Itisalso necessary tobeable tocompare between projects .
Acomparison has tobebased onanassessment ofthe projects using
acceptable values :such anapproach isspecifically considered in
the context ofthe guidelines onevaluation developed inthe
next section .
Aguide inoutline form for Community interest evaluation
^.1 Asexplained inthelast section therequirements fora
Community interest evaluation can bebased substantially upon
national practices .Inthis situation itisclearly neither
useful nor necessary toprepare adetailed guide for evaluation .
Rather what isuseful isaaeri«s ofguidelines that attempt to
direct those preparatory submissions towards questions of
importance and for which there can usefully beacommon approach .
With this limited objective inmind adraft guide tothe presentation
ofprojects has been prepared ,itisattached asAnnex 1.
^+.2 There are four principal points insection Aofthe
guide .The objective ofthe section istoprovide some general
guidance onthe form ofthe project ,the traffic flows involved ,
how benefits and costs mey bequantified and the appraisal criterion .
The central point here isthat the recommendations donot have to
beslavishly followed but that byadopting basically similar
ideas for the evaluation ofprojects decision makers using this
information will have aneasier task and the results will beless
subject todifferences ofinterpretation .
*+.3 The first subsection attempts toset thescene forthe
evaluation :toensure that the evaluation does not neglect either
anoption ofparticular interest nor fail totake account ofthe
interests ofanaffected party .The second sub-section outlines some
basic points concerning theprojections oftraffic .Attention is
directed tothequestion ofthescenario ,themodels andpart icular ly,
totheneed forexplicit and clear formulations .Inthefuture the Com­
mission plans toconsider ways toprovide aframework formore detailed
forecasts that will have tobeprepared specifically forprojects .The
value ofadata bank forCommunity traffic movements will also beclear
inthis context and the Commission also hasplans todevelop this
area .

-7-
if.4 Thethird sub-section deals with thequantification of
costs /benefits .This section contains only arecapitulation of
thebasic features ofacost/benefit analysis .Theaimonce
again should betofacilitate comparisons and tomake the evaluations
astransparent aspossible .
Thefourth andfinal sub-section sets outsuggested criteria
for evaluation .The points that are made are well known and
generally accepted following asthey dotheusual practice inthe
Member States .
^■•6 This short andgeneralised series ofguidelines is
only afirst attempt toset out afeasible approach .Itis
illustrated later but itshould beemphasised that
theapproach isleft tothediscretion ofthesponsors ofaproject .
Thecentral question ishowtoshow "Community interest "andthere are
other approaches which maybepreferable forcertain projects noteably
smaller schemes .The "Guidelines "should beseen asameans toanend,
identifying Community interest ,rather than anend initself .Inthe
initial period oftesting anddeveloping practical Community machinery
there arearguments forexperimenting with modifications andadditions
tothe basic framework .
The Statement ofCommunity Interest
5-1 Anappraisal ofamajor project islikely tobea
compendious document .For the purposes ofanapplication tothe
Community forassistance there are clear advantages inthe
preparation ofashort document which iseasy tounderstand and
assimilate .Thepreparation ofwhat might betermed a"statement "
ofCommunity interest could have twouseful consequences .
first :asnoted itmakes acomplex project easier tofollow and
concentrates attention onthepoints ofprincipal Community
interest .
second :itshould permit afairly easy "sort "oftheprojects into
three groups -theprojects with very good chances ofaid ,
theprojects with apoor chance ,and therest .For therest
inparticular this isuseful asitwould single them out for
theattention they merit toensure that their case is
adequately understood and evaluated .

-8-
5•2 The "Statement in .Summary form ofpoints ofCommunity
interest "-Annex 2isdesigned tolead theproposer i.e. the
group orother body submitting aproject ,through alogical series of
questions .The series ofquestions starts with abasic review of
the "scenario "used for the evaluation ofthe project .Here
themain points tonote concern the assumptions made concerning
economic ,demographic and regional growth .The object ofthis
istoallow the other Member States totake aview onthe forecasts
and relate them asnecessary toforecasts that they themselves have
made .
Question Basks for adescription ofthe principal benefits tousers .
Here the proposer should indicate ,inter alia ,the time benefits
(andvalue oftime used ),fare orcost savings andanyother
notable benefits that the project isexpected toprovide .
Question C,aims topoint upthe effects onother modes orroutes
produced bythe project .Question Dcalls for astatement ofthe
principal effects ofthe project onsome important factors such as
employment ,energy and regional development :these factors are
likely toplay aparticular role indetermining the overall value of
the project tothe Community .Question Earrives atthe central item
ofthe statement -asummary ofthe cost -benefit study ofthe project .
The cost-benefit analysis should include the factors ofparticular
interest tothe Community .Itwill have been prepared following
thenotes set out inthe "guidelines "oronsome other approach ;
themethodology itself isnot important but themotivation and
basis for the calculations should beclearly stated .Question F
directs attention from the integrated cost-benefit analysis
towards astatement ofhow the benefits and costs are distributed
notably over countries andusers .Finally ,Question Gcalls for
the sponsor toindicate why the project merits Community interest .
Ofparticular relevance here isthebudgetary aspect :asponsor
should show that the project not only merits Community assistance
through thebenefits itconfers ontheCommunity but also
that itneeds such assistancetoensure itsearlycompletion.This
justification can originate intwo ways ,either the project does
not rate sufficiently high innational rankings toenter into the
budget orpossibly that thenational budget "envelope "for
transport isnot large enough for thenumberofgood projects
that merit inclusion .
5.3 Insection 6the statement will beapplied tothe
projects that have been choosen todemonstrate theapplication
ofthe Community interest methodology .

-9-
6. The Demonstration Projects
6.1 TheDemonstration projects are asfollows s
-The Channel Link sThe idea ofafixed link crossing ofthe Channel
hashad along andvaried history .There are anumber ofprojects
currently being considered toprovide alink .Theprojects can
begrouped into three main types :
first :conventional tunnels for rail transport alone ;
second :immersed tunnels with ventilation equipment forroad
vehicles travelling under their ownpower ;
third :bridge projects with orwithout intermediate artificial
islands .
Ademonstration project could bechoosen from any these :however as
itisnecessary tolimit the number ofprojects covered
the project for asingle tunnel has been selected as an
illustration .
-Alink across the Messina Straits .Alink from Italy toSicilia has
almost aslong ahistory astheChannel .Asthedistance ismuch
short er,+4kmsrthe project may atfirst sight seem more attainable .
However ,theexistence ofseismic problems creates considerable
uncertainties for construction .
Thealternative schemes proposed consist ofvarious forms
ofbridge and what isdescribed asa"submerged bridge 11;this latter
project involves asubmerged tube -supported atacertain depth inthe
water .
6.2 . TheAlps represent animportant barrier onroutes to/from
Italy .Today ,thebarrier ismore abarrier interms ofcapacity .This
problem isparticularly complex due totheneed tomake decisions for
aperiod avery long way ahead and because ofthe number of
countries involved .The three main rail projects fornew tunnels
that are considered inthe evaluation are :
the Gothard ,anew tunnel roughly parallel tothe existing serving
the most heavily used freight axis from the Ruhr toLombardia ;
the project for atunnel along anew route ,theSplugen .This project
isclaimed toopen upnewpossibilities interms ofregional
development and would use new approach tracks avoiding areas of
existing congestion ;
atunnel along the Brenner route .The existing line isvery mountainous
and imposes severe restrictions onspeed and capacity .The
existing route isarguably the worst ofthe existing rail
possibilities and hence its improvement merits close attention .

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6.3 These three projects ,inpractice there are more than
three projects ascompeting schemes exist ,are the subject ofstatement 1
to3.Itshould berecalled that the object ofthe statement isnot
toprovide adetailed review ofthe project butrather topresent
the available evidence clearly and concisely inorder toassist the
decision-maker toarrive ata view offuture Community action .
The basic information availableto the Commission
is not sodetailed aswould beexpected inaformal submission from
promoters .Only inthe case ofthe Channel link does afully
documented supporting case exist and here some ofthecrossing projects
arebetter supported than others .For projects coming forward tothe
Community itwill benormal forthem tohave undergone anexamination
atthe national level and that they will besupported bya
considerable volume oftechnical and economic evidence .Inthe
statements which are attached many assumptions need tobemade
intheabsence ofinformation ;however fitisconsidered that such
assumptions donot gobeyond what would betheusual capability
ofpromoters tosupply andindeed what they would require fortheir
own evaluations and for national appraisals .
The application ofthe outline presentation ofCommunity interest
7.1 Channel link :Statement Ipresents areview ofthe
application ofthemethodology tothe proposal for asingle track rail
tunnel .The statement shows that thetunnel project can beexpected
tobeviable interms ofanisolated financial project .However ,the
evaluation iscomplicated bythe fact that atunnel promoter ,assuming
such apromoter tobeaseparate entity ,isdependent upon two national
railway companies for its traffic .Innormal circumstances therailway
companies would have every interest toprovide traffic forthe tunnel
but circumstances can beenvisaged where problems could arise .To
add tothis problem ,which bears heavily upon thepossibilities of
financing the project ,isthepossibility ofsome unforeseen event
considerably increasing the costs ofthe works .The statement also
shows that the Community asawhole will derive benefits from theproject .
Theevaluation also shows ,although itshould beremembered that the
analysis wasundertaken in1979 ,that inpurely financial terms afavourable
rate ofreturn should beearned .Notwithstanding these conclusions the
emergence ofafirmly supported project appears some wayfrom becoming
reality .IftheCommunity istofurnish assistance itisaxiomatic that this
should bedirected toareas that would bemost effective .Inthe case of
projects that arebased onprivate finance theprovision ofguarantees
hascreated problems .Should aproject ofthis nature come forward tothe
Community itwould clearly besensible toinclude thequestion ofguarantees
together with other forms ofaid inanydiscussion onthepossibility and
extent ofCommunity assistance .

il-
7.2 The Messina Straits project :the project
forthe Messina crossing is interesting from both the
technical and economic viewpoints .Although the evaluation atthis
time has not included any consideration oftechnical matters itis
clear that theproblems inthe area ,seismic etc.,will call for
ingenious solutions .The general benefit tothe region from a
fixed crossing isclearly brought out .Themajor question mark
against the project concerns itsrelevance toanintegrated
regional development plan for the area .Asthe amount ofmoney
involved isvery high and the financial profitability ofthe scheme
not such astoavoid the call upon considerable public funds itis
inevitable that the alternative use ofsuch public funds has to
beconsidered .Atthis stage before afull evaluation ofa
project inthe regional development context isavailable itwould
bepremature tomake any decision onthe project intransport terms .
The initial study undertaken oftransport aspects needs tobe
supplemented byamore comprehensive appraisal and ifsuch astudy
istobeundertaken acontribution from the Community should be
actively considered .
7.3 The Alpine Tunnel Projects :The Alpine crossing
projects bring together anumber ofelements ofimportance for
Community action inthe field ofinfrastructure .Among the
points ofinterest are :
first :the question ofpricing policy and itsinter-modal ,
international consequences ;
second : thedistribution ofcosts /benefits between Member States of
the Community and non Members ;
third : the ranking ofschemes producing benefits along wayahead
and those that produce quicker benefits .
The need for anew rail tunnel inthe Alps depends
essentially ontheview that istaken offuture traffic growth and
its distribution between modes .Iftraffic were togrow slowly ,
due to low economic growth orachange toless bulky products ,
anew facility would not beneeded until well into thenext century .
However ,iftraffic does grow reasonably quickly newfacilities will
berequired ,based onthecalculations made bytheconsultants ,around
theyear 2000 .However ,traffic growth isnotthewhole story asthe
modal split androuting ofthetraffic arealso important .

-12-
lurning tothe question ofprofitability the statement
shows that instrictly financial terms anew tunnel project isnot
likely tobeprofitable .This ispartly due tothe general economic
situation ofthe railways and also totheparadoxical situation that
when adistance-based tariff structure exists ,anewfacility ,which will be
shorter indistance terms than the existing ,will have alower
revenue .One answer tothis would betochange the distance based
tariffs but apart from theadministrative problems this would
imply therailway would belikely toattract less traffic .
Afurther problem concerns the distribution ofcosts .
Thetunnels costs would fall largely upon one oftwonon-Member
countries -Switzerland orAustria .Asthese countries would not be
able torecoup thetotality oftheir costs from revenue they could
betempted toeither postpone the project entirely or adopt a
policy torestrict road transport intransit and soallow the
rail rates toberaised .Afinal point concerns the fact
that prior toaiding any project ofthis nature the Community
would need totake aview onthe alternative use ofits funds .
These projects start toproduce benefits for theCommunity twenty years
hence ;there may well beprojects that will produce benefits before
these inthe Community itself .
Having made these general points itisclear from the
information displayed inthe statement that aclear prima facia
case exists tojustify Community interest .The issue ofwhich
project ,ifany ,might merit support has been somewhat clarified by
theanalysis but afundamental decision isnecessary regarding the
objectives for future capacity .Adecision onone oftheprojects
should not betaken independently asthe construction ofany one
wilL make itimpossible tojustify economically another formany years .
Inthese circumstances the choice insimple terms can bespelt out as
follows :
If,itisaccepted that traffic will grow asassumed inthehigh-growth
scenario theGothard project appears beneficial at3%discount
the others atlower rates .
If.the trade pattern inthehigh-growth scenario varies toamore
easterly axis theBrenner and theSplugen projects become more
interesting .TheBrenner project isalso somewhat favoured by
the fact that itmay prove possible toeither reduce
substantially oreven close some parts ofthe existing mountain
route thus realising considerable savings interms ofmaintenance .

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7.T- The Projects reviewed
Inlooking atthe results ofthis exercise itis
important todistinguish between thetwostages oftheprocess :
first :adecision inprinciple that aproject isofCommunity
interest inthe context oftransport policy .
second :adecision onthequestion ofCommunity support and the form
itmight take .
Theanswer tothe first question could well bethat aproject
isofpotential Community interest butinterms ofthesecond question
adecision maybetaken that itisnotjustified toaidtheproject
ontransport grounds alone . 1
Inthe three cases that have been examined there is
considerable evidence tosupport Community interest but the balance
ofthe evidence varies from case tocase .Inthe Channel tunnel
scheme there are substantial benefits totheCommunity through user
benefits and thegeneral support forCommunity policy ontransport
andrailways inparticular .However ,itisalso apparent that on
the evidence available the project should not need direct financial
support .What may beneeded issome form ofguarantee .
Asconcerns the Link toSicily theproject does not
appear tobeviable and will therefore require afairly substantial
injection ofpublic funds .Although the link might contribute
materially toregional development inSicily the evaluation did not
allow any clear decision tobemade onthis inthe absence ofa
better understanding ofthe regions transport needs :interms
ofits contribution tothe Community ontransport grounds alone
the project does not appear likely tomerit substantial direct
assistance .The first question tosolve inthis situation
might betoestablish aclear hierarchy ofinvestment needs and
potential funding inthe area .
AsfortheAlpine crossings the evaluation haspointed
upaclear potential interest fortheCommunity .The final decision
must turn onadefinite view ofthe future but itisalready
plain that areasonably strong case forCommunity interest canbemade .
Asregards thechoice ofproject andthetype ofassistance this will
require further work anddiscussions with thenational authorities
inSwitzerland andAustria .Aplausible series ofassumptions
lead totheconclusion that theCommunity could benefit substantially
from anewtunnel hence itisimportant for theCommunity that its
objectives areclearly understood ,andpossibilities ofassistance
clarified ,inthepreparatory work todevelop projects .

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Till ,PROJECTS REVIEWED
rirure 1
Project
ElementChannel
Link
TunnelMessina
Straits
CrossingAlpine
Rail
Tunucir
Financial
prof itabilityGood Poor Depends ontariff
arid transit policy
i,ature ofmain
benefits to
community-major improvement
toimportant
link
-trade stimulat­
ion
-energy savings-regional
development-major improvement
toimportant
link
-trade stimulation
-energy savings
Main questions Future development
ofrailways-regional
planning frame -
work
-other sea links-traffic growth
-modal choice
questions
Sensitivity to
changes inbasic
asGumpt ions
-economic
growth
-regional
development
-energy pricesrobust downwards
improves upwards
very small
improves asenergy
costs increasessome improvement
important
probably negativevery sensitive
none
improves ascost
increase
Conclusions Good case for
Community interest ,
possibly guaranteesome case for
Community support
incontext of
regional programmeclear prima facia
case needing
further analysis

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7.5 . Overall ,the application ofthemethodology has been
shown tobefeasible even for cases where the amount ofinformation
islimited .Thepreparation ofashort statement ofCommunity
interest has been undertaken and itishoped that this first
attempt isconsidered useful :itwill clearly benecessary to
improve and clarify the approach where doubts exist .The
object ofthemethodology istobeflexible :toaid the decision -
maker todecide upon aidanditsmost effective level .With this aim
inview adecision ,inadvance ,tofix an arbitrary limit of15%or
20%iswrong :each major project should beconsidered onits
particular merits andparticular needs .The •Statement ■is
designed togive the decision-maker amaximum ofinformation
onthenature ofCommunity interest ,andwhen possible toset a
value onthis .The assessment ofCommunity interest isintended to
help seta limit ontheassistance that might beaccorded .The
appreciation ofthe financial situation and where appropriate the
ranking oftheproject innational cost/benefit terms isintended
toensure that Community assistance isapplied effectively
and efficiently .

ANNEX 1
-16-
GUIDELINES KIRTHE EVALUATION OFCOMMUNITY INTEREST
SECTION A.Basic Information andtheApproach toado£t
1.General Outline for the Appraisal Process
1.1 Allpotentially attractive schemes forsatisfying theobjective under
study should beappraised ,including those without active proponents .
Theanalyst should consider theinclusion ofadditional options ,
particularly where those putforward donot serve allpossible markets .
1.2 Where there isalarge number ofoptions ,they should besubjected
toapreliminary screening toproduce ashort list .Care must be
taken with the exercise ascosts for some options may besubject to
high margins oferror .
1.3 The evaluation must becomprehensive ;itmust include an
assessment oftheregional ,social ,andenvironmental aspects ofthe
schemes .
1.4 The evaluation must aim totake into account theinterests ofall
affected parties .
1.5 Methods ofquantifi cation andofvaluation ofcosts andbenefits must
beexplicit .
2.Projections ofTraffic
2.1 The scenarios ofexternal economic andother variables should beexplicit ,
andinternally self-consistent }where they arenotconsistent with those
ingeneral usebytheCommission orbynational Governments ,thereason
forthedivergence should beexplicit .
2.2 Traffic should ,where possible ,bedivided upinto groups within which
thedeterminants ofdemand growth mayreasonably beexpected tobethe
same ;thus passenger traffic should bedivided bytrip purpose ,and
goods traffic bytype ofgoods .
2.3 Projections oftraffic should bebased onexplicit models ofconsumer
behaviour .
2.4 Themodels used should beconsistent with theevaluation process .

-17-
2.5 Where possible ,themodels should bebased ondata onindividual
households ,firms andtrips ;and,again where possible ,statistically -
estimated from specifically designed surveys .
2.6Assumptions about theprice charged bythescheme ,andbycompeting
andcomplementary facilities ,should beexplicit ,andreflect informed
opinion onwhat islikely .
2.7 .Account should betaken oflikely future developments incompeting and
complementary infrastructure .
2.8 Thepossibility oftraffic arising from :
(a) diversion (route andmode choice );
(b) redistribution (destination orsupplier choice );and
(c) generation (newtrip choice )
should beconsidered ,andthecategories should bedistinguished in
theanalysis .
3.Quantification ofCosts and Benefits
3.1 Costs andbenefits should ,where possible ,beexpressed inasingle
numeraire ,money .Where this isnotpossible they should bequantified
inphysical terms .
3.2 Theweights attached tofactors notvalued inthemarket should in
general bebased on'revealed preferences' .The specific values given
tofactors (e.g. time savings )should bespecified andthephysical
amounts involved also given .
3.3 Allcosts andbenefits ,forallschemes ,should becalculated making
thesame ,explicit setofassumptions about themovement ofrelative
prices offactors ofproduction ;this setshould beconsistent with
the scenario used inforecasting .
4.TheCriterion forAppraisal
4.1 Allschemes should beappraised including costs andbenefits occurring
between thepresent andthesame time horizon .
4.2 Except where thelife ofthestructure isshort ,thetime horizon
should belong ;appraisal at20and50years isrecommended although
thechoice must depend onthecircumstances ofeach case .
4.3 The time streams ofcosts and benefits should beindicated toallow
other discount rates tobeapplied ifrequested .

-18-
4.4Theincidenceintimeofindividualitemsofcostandbenefitshould
beshownexplicitly,toenabletheirevaluationatanychosendiscount
rate,ortheuseofothercriteria.
4.5Thesensitivity oftheresultstovariationsin:
(a)externalscenarios;
(b)capitalcosts;and
(c)pricingpolicies
(d)discountrates
plusanyotherrelevantfactorsshouldbeexamined.
4.6Wherearevealedpreferenceapproachhasnotbeenusedtovalue
factorsthereasonsshouldbegiven.Inthecasewherecertainitems
havebeenfoundimpossibletoquantifyorvalue,anestimateshouldbe
givenofwhatvaluationwouldbeimplicitinalteringadecisionbased
onquantifieditems.
SECTIONB.Presentation ofaCommunityInterestStatement
5.1Anexplicitstatementshouldbemadeofhowandtowhomallitems
ofcostandbenefitaccrue.Thisstatementshouldincludeboth
quantifiable andnon-quantifiable elements.
5.2Wheretheseitemshavebeenexpressedinmoneyterms,theyshouldbe
discounted andexpressedaspresentdiscountedvalues.
5.3Thedistribution ofbenefitsbetweencountriesshouldbeshown,and
thatoffinancialcostsandbenefitsbetweenthemainfinancingagencies,
andotheraffectedparties.
5.4Wherebenefitsaccruedifferentially betweenregions,theirdistribution
betweenregionsshouldalsobeshown.
5.5Aswellastheinitialgeographical incidenceofthebenefitsthe
distribution oftheirultimateincidenceshould,wherepossible,be
shown.
SiiETilKAT'l'ACliiMJ "tfTAÏEKbN i.'

-19- ANîfEX 2
STATEMENT INSUMMARY FORM
OFPOINTS OFCOMMUNITY INTEREST
Project :
Description :
Question A :Describe theeconomic "scenario "fortheproject ,
(indicate theassumptions made about G.N. P.,
trade development ,relative prices ,etc.)
Note :tables ,figures etc .canbeattached separately .

-20- Annex?
*• jareprincipalbenefitstonooroofthoproject?
(Givethevalueofanytime,fareorotherbenefitsin
quantified ,termsifpossible)
3»QuestionC:Doestheprojecthaveanimpactonotherroutesorj
modesoftransport?. I
(ifsoindicatethetrafficandinvestmenteffects)

-21- Annex2
4*QtiertlonDtWhataretheprincipaleffectsoftheprojectonfactors
suchasemployment,environment,energy,regional
development?Mentionanyotherexternalfactorsofimportance.

-22- Annex2
5QuestiongyProvideasummaryofthecost-benefit studyandan
appreciation ofthebenefitsoftheprojectforthe
Community.
(indicatethelikelyeffectsoftheprojectonCommunity
policiessuchastransport,energy,environment ,regionaletc)
Question*IProvideastatementofhowth*benefitsoftheprojectare
distributed throughouttheCommunity.

-23-Annex 2
7Question Qjjustify Community fiancial support fortheproject !
(provide anindication oftheprofitability ofthe
project atthenational level andshow howthe
project relates tonational budgeting )
T*

-24- grATMarrij
i
i
STATEMENTinSTWKART70RM j
ofPOINTSofOOKMUNITT INTEREST
Projgct 8For asingle track railway tunnel between the U.'K .andFrance .
Descriptions
The project istobore asingle tunn-el ofapproximately ?M.'splus aservice
tunnel of4*5M 'sfrom France toU.K. .The tunnel would beused byrail
services plus alimited number ofservices forvehicle transport .Provision
would bemade forlater expansion by .,the'addition ofasecond tunnel .
(Theproject wasevaluated in1979 )
1.vacation Al 1Describe theeconomio 'scenario 'fortheprojeort .
(indicate theassumptions made about C.N.P.,
trade development ,relative prices ,eto.)
The scenario included twoalternative hypothesis concerning economic developm­
ent :these are shown inTable S.l.l .The assumptions concerning population
are shown inTable £.1.2 ..Under the "low growth "scenario itisassumed that
therelative ("real ")cost offuel will rise byJ>%peryear to1985 andby
1.3% thereafter .Theassumption inthe "high growth "scenario isthat the
relative cost ofenergy will remain unchanged uptothe year 2000 .
COMMENT .
The economic growth rates used may now beconsidered toberather optimistic .
This points tothe need toconsider the .results ofthesensitivity analyses
with care .
Notet tables ,figures eto .canbeattached separately .

-25-StatementI
TableS.1.1.Population
Populationlevels(inthousands Jandtfroilfthrates(%peryear)
•1985 Growthfate 2000Growthral
Country Population 1977-1985 Population 1985-2000
F.!!;Germany 60100-0,3 57200-0,3
Prance 55900 0,6 59000 0,4
Netherlands 14700 0,7 15600 0,4
Belgium/Luxembourg 10400 0,3 10400 0,0
Italy 58800 0,5 61200 0,3
Austria 7700 0,3 8000;°t3
Spain 39100 0,8 45300 1,0
Switzerland 6900 1,1 7600 0,6
UnitedKingdom 58600 0,6 60000 0,2
Othercountries X 0,4- 0,3
Ο.Ώ.Ρ.andhousehold .expenditure
,G.D.P.itrowthrates(foperyear)
Country 1977-19851985-2000
LowHighLowHigh
Gormany 1.63.02.903-5
France 2.03.72.03.5
Netherlands 1.73.12.03.5-
Belgium/Luxembourg 1.32.42.03.5
Italy 1.32.42.03.5
Austria 2.03.82.03.5
Spain 2.34.32.03.5
Switzerland 1.42.72.03.5
UnitedKingdom 1.52.82.03.5
Others
It1.73.2
r2.03.5

I
–26- Statement I
2.Qneirtlon BijWhataretheprincipal bonofits touoera ofthoprojoct ?j '
(Givethevalue ofanytime ,far*orother benefits in |quantified tens ifpossible ) !
Theprincipal benif iciaries ofthenewfacility areleisure j
travellers whomake up'the bulk ofthetravellers .From a '
position where themajority oftravellers originated intheUK j
itisforecast that 'bytheyear 2000 themajority will originate in >
theother European countries .Business travellers donot gain
extensive benefits from this project astheneed to"flight "
(i.e. runthetrains inonedirection only forlong periods )does ,
notoffer acompetitive service toair .Theprincipal beneficiaries j
ofthefreight side arethose users whocanswitch easily torail .
Forquantified benefits see Table .S13 .
COMMENT
Asthepassenger forecasts arevery dependent upon increasing
disposable income thegrowth rate oftheEECcountries isvery
important .Thefreight users will face theproblem intheUKof
adapting toanetwork which israther attenuated bythestandards
ofother countries .
3•Question CtDoestheproject haveanimpact onother routes orj
modes oftransport ?* I
(ifsoindicate thetraffio andinvestment effects )
Theproject hastwomajor impacts .First ontheshipping services .
Second ,onthetraffic onexisting rail routes .Both arelikely to
beimportant .Theshipping services areforecast toloose a
substantial part oftheir existing "classic ",i.e. non-car accomp­
anied ,traffic .However ,astheoverall demand isexpected togrow
theimpact ontheshipping services canbeabsorbed byastand­
still oninvestment for anumber ofyears .Asforexisting links
doubts have been expressed about thepossible impact ofadditional
services onheavily used commuter routes near London :this problem
canbetackled bylimited investments andnewoperating practices .
Losses will also occur inthePORTS and forROAD HAULAGE .
COMMENT
Theproject will have aclear benejficial effect onrailways
particularly intheU.K. .Itdoes jpose aproblem formaritime
traffic andproper long-term plannling andconsultation will be
needed toensure theinception ofthenewfacility does notcreate
excess disruption .

-27-Statement I
4»Question !)! What aretheprincipal effects oftheproject onfactor *
such asemployment ,environment ,energy ,regional
development ?Mention anyothdr external factors ofimportance ,
Employment .Two stages should bedistinguished ,construction and
operation .Moreover ,itisimportant toseparate thepositive (job
creation )from thenegative effects onemployment inshipping and
ports .The net effect during construction islikely tobepositive
whereas the longer-term direct effect could beneutral oreven
negative taking employment losses onships into account .
Environment .The environment isaffected directly bythe newworks
and indirectly bythe transfer oftraffic between modes .Special
attention has been paid tominimising the effects inKent and the Pas
deCalais ..Overall aswitch torail isthought tohave positive
environmental effects although overall the effect issmall .
Energy .Again theconsequences areunlikely tobevery great .The
single track tunnel isunlikely toabstract large volumes oftraffic
from air orroad .Asships are reasonably energy efficient traffic
abstracted from this mode will not greatly change the energy balance .
Regional Development .The UKside oftheproject isnot anarea that
suffers from particularly severe regional problems sinFrance the
difficulties are somewhat greater .Aneffort has been made to
concentrate thetransport activities asmuch aspossible inFrance !
(partly forenvironmental reasons ).Theeffect onregions intheUK ;
far from the tunnel portal issmall but positive tothe extent that
theimprovement intransport links byrail will favour particularly (
long-distance transport e.g. regions intheNorth-East andScotland .|
Interms ofdiverting expenditure the only effect would occur ifit
could bedemonstrated that investment onthis project was diverted
from investments inthe regions .
COMMENT
Tothe extent that the project has important impacts thesei
tend tobefavourable .However ,theproject byitsnature j
expressively designed tobe"non-agressive ",andtodisturb as !
little aspossible the "status-quo "situation . ,

-28- Statement I
Question Provide anummary ofthecont-benef itctudy andan •
appreciation ofthebenefits oftheproject forthe
Community .Give thediscount rate used andmention any
sensitivity teste undertaken .
(indicate thelikely effects oftheproject onCommunity
policies euck aatransport,energy ,environment ,regional etc)
The estimated distribution ofBenefits and Costs among transport
users isgiven inTable SI.3..This table shows for comparative
purposes estimates for some ofthe other projects .Itwill benoted
that thediscount rates employed offer awide range 3and10$ :the
period used for discounting is50following the year ofcompletion
ofthefacility .The forecasts indicate afavourable cost/benefit
rate ofreturn .For the Community the project will remove avery
considerable barrier tothe development ofanefficient Community
railway system and provide areliable means ofall weather transport
to/from the UK.Interms ofrailways theproject issensible and
itcould ,with anadditional tunnel ,form ahigh quality ,high cap­
acity link for all modes .
COMMENTS
The present project isclearly anatural link tothe rail system
but because ofthis its future isalso very dependent upon the
railways .Itsupports ,allbeit notgreatly ,thegeneral line
followed byCommunity transport policy and does not offend
particularly against other policy objectives .
Ç-^erMor .'sProvide astatement ofhowthebenefits oftheproject are
distributed throughout theCommunity .
Theapproach used for thedistribution ofbenefits was asfollow .- : '
-thesurplus of,say ,aGerman user isallocated toGermany ,
-thesurplus onthetunnel isallocated equally totheUKandFrance
-thecost orbenefit toother transporters isallocated tothe
country ofthetransporter concerned ,e.g. Belgium inthe case
ofaloss oftraffic toBelgian ports .
The results are shown inTABLE Sl.^f .

TafeloS.1.3. Th«DistributionofBenefitsandCost®kmoagTransportOssm IandProducara I
tmtJanuarj1979prices*JPTadiscountedto1979 •
Frejict SinglaTrackTunnel DoubleTrackTuonai Bride·1
BridgeandRailFacility
Discountrate· 5* 10* 3< 10* 3* 10* 3* 10*
CroifthScenario· LRL HLRLHL1LHL Rl■
Λ·Link 216222652132234214663128061217255201-739-28329996512-696-245
DeerBenefit:Passenger·
Freight1193
3421512
414250
69304
812950
7764974
1167551
141812
19β2785
5125573
1007448
83798
1553180
1415570?
1315Tiff
199em
199
ferry
Operator·Lo-Lo
Ro-Ro-51
-II9I-80
-114»-11
-196-17
-145-112
-2122-233
-3452-23
-277-41
-129-56
-1579-125
-3151-9
-262-18
-22«-116
I-2164-262
-35Q5-21
-236-41
-106
SeaPorta -132-116-29-20-194-351-47-60-115-329-25-46-206-438-43-63
Urline· -50«-674-118-150-521-711-132-165-397-697-65-101-442-636-95-125
Lirporte -77-23-10-10-28-31-13-14-1 100-18-19-7-8
ftallvay· Θ49942163177935956165162-74-345-12-4963459010798
load·:Anthorltlea
Operators0
00
00
00
0-2
0-2
0-3
0-3
0-157
0-157
0-91
0-91
0-157
0-157
0-91
0-91
0
Total 2645309233044358988948643117126426977-57313551259013-345405

-30- StatementI
S.1.4
Distribution bycountry NetBenefits
jSofDiscountedat3Discountedat10£
totalhighgrowth lowgrowth
•Franoe47*01453*2 155*1
β
Belgium 3*3102 10.9
Luxemburg
Hatheríanda2«989»6> 9*5
Germany 2»886«5
Italy 00 0
U.K. 29.5912 97.4
Spain 1.953.7 6*3
Other
oountries 12.6 L389*6 ■4^*
3092 330
Hot#1itaxesnotinoludedincalculation #ra-ta0f
2iduetotheeffeotaofvariatioaainthe/dieootintonooartswhioh
havenotbeenreoaloulatcdthefiguresaxeapproximative .

-31- Stat«lient I
7Question Q {Justify Community fiancial support fortheprojectj
(provide anindication oftheprofitability ofthe
project atthe national level and show how the
projeot relates tonational budgeting )
The financial profitability ofthe project issatisfactory .Tables
SI.5and SI.6show theresults under theprincipal scenarios .
However ,the tables fail tobring out the two major problems with
the project :
first :theproject involves along period with noreceipts (upto
10years )andaneven longer period before netreceipts are
earned .Inthis period changes inconstruction costs ,
inflation etc .could cause difficulties for the promoters .
second :The sole users oftheproject are the two national railways ;
policy changes bytherailways could seriously affect future
profitability .
The argument for.'Community support istherefore based onthe
evidence ofbenefits totheCommunity but taking account ofthe
expected results does not ask for direct support .Rather the object
ofCommunity assistance would betoprovide aguarantee for the
provision ofthenecessary capital tocomplete the scheme inthe
event ofasevere over-run ofcosts .H

-32- otatement I
THE FINANCIAL HATE OFRETURN
TA3L2 S.I.5 FLOW
Single
TrackSUPTO
Double
TrackYEAR 200
Road
Bridge0
Road
Bridge
plus
Single
RailFLO
Single
TrackWSOVER
Double
Track50YEAR
Road
BridgeLIFE
Road
Bridgc
plus
Single
Rail
IRR (Ζ) 11.0 8.3 -3.7 -2.0 14.3 12.6 5.7 6.8
NPV's 3Z
ffm -, .....464 577 -971 -799 2162 4215 1725 2999
\Llit
discounted 5%
1070N _277 285 -1026 -966 1131 2074 282 901
10Z 26 -91 -1006 11086 213 280 -739 -863
Table (s.1.6 .)below presents therate of {return intheHigh Growth
case .
TABLE
S.1.6 .FLO
Single
TrackWSUPTO
Double
TrackYEAR 20
Road
Bridge00
Road
Bridge
plus
Single
RailFLO
Single
TrackWSOVER
Double
Track50YEAR
Road
BridgeLIFE
Road
Bridge
plus
Single
Rail
IRR (Ζ) 10.9 10.9 0.7 1.9 14.3 14.9 8.7 9.1
NPV's 3Z 469 987 -408 -257 2265 6631 5202 6512
discounted 5%
tη 10?^279 586 -617 -573 1183 3335 2070 2698
10Z 26 54 -814 -904 223 612 -283 -245

STATEMENT no.?
STATEMENT InSOMKMff 5*0fM
efFOW*S of00MMUHIWIOTEREST
anfrlfffracrjcagagyjGsgg^gaaMMBBei j»tawM»aMKa–anrstr-ag?gacswa
f*ro.1<gt7% I Afixed link crossing from Sicily either as t
-asuspension bridge forboth road and rail ;
-asubmerged tube supported |inthe water .
Pegcriptl «m%
\ ■
Sicily currently linked tomainland Italy byanumber offerry routes .
However ,the comparative short distance involved and theheavy traffic
flows makes afixed link aninteresting proposition .This statement
summarises theresults ofastudy Undertaken in -1980/81which examined
thepotential Community interest of';thj& projects .£_Itshould benoted
that technical problems e.g. seismijc difficulties ,exist :the Commijssion 's
t/orkhasnotbeen able toconsider questions ofatechnical nature _/.
Thestudy revealed gaps intheavailable -information and thecompletion
ofthe study required anumber ofestimates tobemade .
1*QuestionAt|Describe -theeconomic'scenario'fortheproject.
(indicate theasssussptions Badeabout G.N.P.,
tradedeTOlswsRnttrelativeprioee,eto.)
Themain features ofthe scenarios developed bypromoters concerned G.D.P.
growth , -population and income .TheCommission 'sstudy modified certain
ofthe scenario elements ,noteably G.D.P. :theassumptions retained
were :EEC ,high +2,6% p.a.,low ,+ Italy ,high +2.9%p.a.,
low ,+1.7# p.a.,except forSicily andCalabria where rates of
+3'^% p.a.and +2.2%p.a.were employed .Thepopulation forecasts
prepared were accepted ,the "key"figure here being anItalian population
figure of66Mintheyear 2010 . .
COMMENT
Theoverall range used isacceptable more information onregional
developments would beuseful .
Notestables,figuresetc.©anbeattachedseparately

-34- Statement 2
|Whataretheprincipal benefitbtousers ofthoprojoct ?j
(Gi-vre thevalue ofAnytime t?&3reerother benefits la
quantified texiss ifpossible )
Theprincipal beneficiaries areinter-regional Italian travellers .
From theattached map (Fig.l )itcanbeseen that theposition of
thebridge isnot favourable forlocal travel which islikely to
continue byferry .The number ofnon-Italian travellers ,almost
entirely tourists ,issmall .The amount ofgenerated traffic
isalso not forecast asbeing large asthe new facilities are
aclose substitute for the ferries .The assumed time savings per
crossing are kGmins forroad and 78minutes forrail .The
value oftime iscalculated onthe average income per hour ;for
leisure trips thevalue -is30%ofworking time .
COMMENT
For long distance ,particularly international ,airtravel is
predominant .Forfreight cargo services toports such asGenova or
Marseille play animportant role .
3»Question C:Doestheproject haveanimpact onother routes orj
modes oftransport ?. 1
(ifsoindicate thetraffic andinvestment effects )
The new facility has asubstantial effect onferries aswould be
expected .Theevidence available isnot sufficient togive precise
information but itisclear that the railway ferries in
particular would disappear .The effect onferries will beless sevei
than thought as,forinstance ,abus trip between Messina and
Reggio'via abridge islikely totake longer and cost more
than the Existing hydrofoil service .The overall modal
effects areexpected tobesmall astheconsequences forrail and
road areroughly similar .However ,pther bridge situations
(e.g. Bosphorus )show that some diversion from foot passengers
tocar travellers islikely tooccur .
COMMENT
Theproject should particularly improve therail links although
the time for the current crossing appears long bythe standards
ofsimilar trips in ,say ,Denmark . 1

-35-.Statement 2
Figure•î
THEMESSINASTRAITS
Railway
TheNorth
SICILY
Autottrwlc/\Zr'..
Palermo jr \ J>f % AutostradaR / % North
"{ VILLA)>./SANGIOVANNlMi\J\*rkjg^iS
PalermoIV/A «
* \&RailwayOyt Catanzaro\31Taranto
Sari
DCALABRIA

-36-ΡΓΘ5ΘΠΪ3Ζ 10ΠΘΝ.2
4.Domanda D:Qualisonoglieffettiprincipali delprogettosufattori
comel'occupazione ,l'ambiente,l'energia,losviluppo
regionale ?Menzionarealtrieventualifattoriesternidi
rilievo.
Ilprogettoavràuneffettodibrevedurata(4-5anni)sull'OCCUPAZIONE ,
maeffettiduraturidipenderanno dallostimolodellosvilupporegionale
dicuisièdettoinprecedenza .Nelleattivitàdinavigazione eportua­
livisarannoperditedipostidilavoro.
Nonsisonoriscontrate attestazioni diuneffettosull'AMBIENTE :ène­
cessario unulteriore esameditalefattore.
Dall'incidenzarelativamente discarsorilievosullaripartizione trai
modirisulterebbero conseguenze ditiponeutrodelprogettosull'ENERGIA,
trannenellamisuraincuinumerosipasseggeri,cheattualmente ricorrono
aimbarcazioni ,userebbero autoveicoli .
Ilmaggiorpuntointerrogativo inerentealprogettoriguardal'incidenza
sulloSVILUPPOREGIONALE,inparticolaresull'industria esulturismo.
Perquantoattienealturismo,iconsulenti hannoritenutocheglieffet­
tinettialivelloregionale sarannoesigui:dovrebbeesserviunalimita­
taespansione delnumerodipasseggeri chesirecheranno inSicilia,ma
ciòcostituirebbe inunacertamisuraunaperditaperaltreregionidel
Sud.Nelsettoredell'attivitàindustriale ,nonsembranoprobabili modi­
fichedirilievo,inquantoilcalorelativodeicostiditrasporto,in
particolarepresumendo unmiglioramento deicollegamenti ditrasporti
marittimi alungadistanza,sarebbeesiguo.
OSSERVAZIONI
Cisipuòchiederese,dipersestesso,uncollegamento eserciterà
un'incidenza dirilievosullosviluppo;tuttavia,seuntalecolle­
gamentodovessefarpartediunampioeglobalepianodisviluppo
cherichiedatrasportipiùsicuriepiùefficienti versoilcontinen­
te,ciòrisulterebbe importante .

-37- Statement 2
,5Question Provide asummary ofthe coat-benefit study and an •
appreciation ofthebenefits oftheproject forthe
Community .Give thediscount rate used andmention any
sensitivity tests undertaken ..
(indicate thelikely effects oftheproject onCommunity
policies such astransport ,energy ,environment ,regional etc)
Table S2.1 setouttheresults ofasummary cost benefit study .
Thetable includes only benefits arising inthe first 20years of
operation except forrevenue where this has been extended for a
further 30years toshow the importance ofthis item .Although
the table shows afavourable result itisclear that the
financial returns would not besuch astoencourage private
investors .Theuser benefits from the project are substantial
but asnoted below are overwhelmingly Italian .The Italian
benefits accrue substantially toSicily and ,toalesser extent ,
Calabria ,both regions assisted bytheRegional Fund .The
benefits arelargely time savings andtheanalysis hasnot
shown clearly what could beeffects ofthese time savings onthe
general level ofeconomic activity inthe regions concerned .
COMMENT
Themeasured benefits arevery largely interms oftime-savings .
Itisimportant totranslate these into the effect on
activity intheregion . • t
Question *!Provide astatement ofhowthebenefits oftheproject aredistributed throughout theCoramunity .
The impact oftheMessina Straits fixed link will beconcentrated
inItaly .The only exceptions will be : .
(a)benefits toforeign tourists intime and cost savings ;
(b)benefits toforeign consumers ofSicilian products ;
(c)c.osts toforeign producers ,asconsumers consume substitute
Sicilian supplies ;
(d)benefits toforeign producers whosubstitute forSicilian
producers inSicilian markets .
The best estimates ofthese factors produces avery small
proportion ofthetotal netbenefit oftheproject .

-38-Statement 2
TableS.2.1DiacountedPresentValuesofCoatsandBenefits
(billionsoflire,1978prices,diacountedto1983)
HighGrowthHypothesis LowGrowthHypothesis
Itemofcostor
benefit 3%5%10*3*5%10*
Linkconstruction and
20years'operation -387-537-715-527-636-761
Further30years'
operation 7343486358827952
Closingdownferries
(20years) 549417226415314135
Savedinvestment in
anewport 327286184327286184
Userbenefits 1105813409774577299
Net.presentvalue 232813271671577820-89
Internalrateofreturn 11.956 9-3*

t
I
I
-39- Statement 2
7Queetion 0[justify Community fianeial support fortheproject ^
(provide anindication oftheprofitability ofthe J
project atthenational lerel andshow how the i
project relates tonational budgeting )
Available evidence isincomplete and additional work isneeded '
inanumber ofareas .However ,from the results ofthe Commission f
study arenotgenerally favourable towards theproject being j
financially viable .Tobeconstructed itseems clear that I
assistance from public sources isnecessary .The argument (
forCommunity support hastobebased onregional development !
grounds asthebenefits instrictly transport terms tothe t
Community donotappear tobesubstantial .Thereal question j
tobeanswered before Community support canbejustified iswhether the
rather large injection offunds into this project would give
abetter return than asimilar sumspent inother areas . J
For this question tobeanswered acomparison with other ,
non transport ,projects inthe context ofaregional plan would
have tobeundertaken .
I
i

-40" 3TATMBHT 3
STATEMENT inSTKFJUiT FORM•MwaaKKtnffiaain'A 'iw^aiui^cxoBVOMHMBaaiKa
of P01T ;!3 OO^fUHTT INTEREST
*-œats»iu<..7 >"3acs*a*fT r.vxma
Prolecti For new Alpine rail tunnels ..
Deacriptiont Three principal options exist toincrease trans-Alpine ra
capacity .
ànew low level Gothard Tunnel :
atunnel along anew .alignement called the Splugen ;
various tunnel projects along theaxis oftheBrenner .
This summary presents,' aStatement oftherelative benefit
totheCommunity oftheprojects usinff the best
information available .Theevaluation relates to1981 .
(SeeFig .1for thesituation ).
Qaeetlon At 1Describe theeconomio 'scenario' fortheproject .
(indicate theassumptions mode about G.N.P. ,
trade developaent ,relative prioes ,cto.)
The scenario used for the traffic forecasts isbased ona
series ofhypothesis set out intable S3•1•For the non
Community states -Austria and Switzerland -the same
sectoral growth rates asinGermany have been employed .
For the period 2000 -20J0 the following assumption was
made :
high growth -thetrends intheperiod 1978-2000 are
continued tothe end ofthe period ;
low growth -Nogrowth invalue added after 2000 .
Notes tables ,figure *etc *can beattached separately .

-41-
Statement 3
Figure 1
TRANSALPINE RAILROUTES
FRANCE
ToFrinci
ZURICH.'ToGermany/
virfi
JW«El/
4T\
/SMTZERILAI/\l«,»\BRIG,Oorthird''\"lJJ\ )/\VKA
ToFranc**"\wml\
VcHAMBERY\ MILANO
*K»*wÈ»y*cL_
T0«ÎÏÏ0*C.
)
//GERMANY
ToGarmanyOMUNCHEN
/
/\'
/
»ToGermany
i–\\
sJA\'MNSSRUCKToAuttria&
E.EuropeAUSTRIA
x/K-/'
)r-vi>
LUGEN/
Gotthard\\\–l\/u-'^TAN.*,/ANDr3•SPLUGEN/
CHIASSOBrenner*
ToAustriaI.
E.Europe
TARVISI
WEAONAJ
ITALY
VENTIMKal,IA
ToFrancetSpain/ToYugoslavia
KEY:––Bordara Railway (·)Capital
/Saa

TableS.3.1.
Sector
Agriculture ,forestry,fishing
Energy
Industry:
Minerals(Metallic)
Min^rjal-aLHÔfl-iBôtallic )
ChemicalProducts
Metallicproductsexc.machinery
Industrial 4kg,aachinery
Precisioninstruments ,
officeequipment
Electrical
TransportEquipment
Pood,drink,tobacco
Textiles,footwearetc.
Paper4paperproducts
PlasticArubberproducts
Other
CivilEngineering AConstruction
MarketedServices
■on-marketed ServicesrimneaStnan
105142
135151
76128
115423
HT153
96118
101116
203186
170158
169121
143123
93104
121111
98120
134102
105117
153156
145157
TOTALGROSSDOMESTIC PRODUCT 139143ofHrgothea<n >ofT»lwMMat
MarketPrleeabySectoris2000
Indicesusing1978»100
LovGrovth
Italyfotherlands Belgi«/Lo*HighGrowth
FranceGermanyItalyMotherlands Belgiua/Lux
134 137 92 135168160176 123
133 116 163 181176178197 202
140 69 82 116171204118 121
133 102 ♦46 ^60 ■VT2187134 152
166 91 126 195227230163 193
116 122 116 141162164163 168
133 120 136 154164 181160 195
172 138 105 260237274177 154
139 113 126 228217188163 188
133 93 178 222179182129 217
148 161 128 191160195185 161
144 64 74 132139190 86 108
119 125 93 159158182158 128
147 103 114 149193215152 202
145 91 115 184153211134 167
110 97 133 144157144122 164
155 145 136 192193194 180 170
J54 143 139 176189185168 175
145 132 132 179184187170 170

Statement 3
2.QnewtlonB i|Whataretheprincipal benefit stousersoftheproject ?j
(Give thevalue ofanytime ,far*orother benefits la
quantified terms ifpossible )
Thebenefits ofall theprojects come from two sources -:
(a)theshorter and/orbetter graded routes will mean lower
distances ,less time and theuse ofless power ;
.(b)theimproved characteristics will allow more heavily loaded
freight trains saving operating costs . t
Asanexample ,the "new"Gothard would save 2hours for
freight trains :the "new"Brenner would save 2.'+hours .Inboth
cases thetotal nettrain weight woild increase by150%(33%).
For the Splugen' ,traffic diverted from theexisting Brenner
' would save 0.8hours .There are substantial economics in
railway costs and itisassumed that inthe case ofpassenger
tariffs based onmileage these savings arepassed ontotheusers .
3*Question CiDoes theproject hare animpact onother routes orj
modee oftransport ?. _ 1 , . . *
(ifsoindioate thetraffic andinvestment effects )
Thecompetitive position oftherailways ininternational traffic
to/from Italy would beimproved through these projects .However ,
the impact onexisting traffic flows ,principally freight ,
byroad would not belikely tobegreat .Thenewprojects are
basic.ally designed toprovide considerable increased capacity to
cope with anexpansion ofdemand .'The information concerning
passenger traffic flows was not sufficient tomake more than
anhypothesis ontransfer torail inthecase ofnewtunnels .

-44-
Statement 3
4»QueetlonDS What aretheprincipal effects oftheproject onfaotors
cruch asemployment ,environment ,energy ,regional
development ?Mention anyother external factors ofimportance .
ENERGY
The new tunnel projects will provide energy savings intwo
ways .First ,there will beasaving inthe consumption due to
avoiding the steep gradients ofthe mountain sections
and because distances are reduced .Second ithe diversion from
road transport will also produce savings .
Nodetails are available onother aspects ofthe projects .

,5Question-45- Statement 3
Provide asummary ofthecoat«benefit study andan •
appreciation ofthebenefits oftheproject forthe
Community .Give thediscount rate used andmention any
sensitivity tests undertaken ..
(indicate thelikely effects oftheproject onCommunity
policies suoh astraneport,energy ,environment ,regional etc)
Thecost/benefit analysis uses amean value oftime based »
upon average hourly wages .Leisure time isvalued at30%of
working time .Tables S3.2andS3.3show thecosts /
benefits discounted at3 butwith theassumptions that had to
bemade thefigures areillustrative only .Itwill be
noted that inthehigh growth situation theGothard project is
almost profitable ata3%discount rate butfairly
substantial user benefits give apositive overall cost/
benefit rate ofreturn .
ftoeartlon *iIProvide astatement ofhowth#benefits oftheproject are
1distributed throughout the Coffinunity#
Table S3.kgives adistribution ofoperating benefits between
nations .Itwill benoted that inthehigh growth case
thebenefits totheCommunity from theGothard arealmost
double C+85 MUCagainst 273MUC )those accruing to
other parties .Table S.3.5 .shows howthebenefits vary
according totraffic forecasts .
«

-46-
Statement 3
Table S.3.2 .Present Diacounted Valusa ofCoats andBenefits
(millions ofecu ,diacounted to1985 atJ>%peryear )
High Growth
Coats and Benefits toRailways GotthardProject
Brenner Splugen
Saved operating coats -freight
-passengers
New revenues
Lost revenues-freight
-passengers
-freight
-passengers
Track maintenance
Netrailway operating surplus
Capital costs
Coata and Benefits toUsers
Saved costs of
rerouting
Fare reductions
Time savings
Netconsumer surplus
Other Items
Environmental impact
Régional impact
Impact ontrade génération-freight
-passengers
-freight
-business
-other-83
81
1081
53
1132
-1230
168
414
176
"758-37
59
458
28
508
-1803
71
431
93
"595158
117
1312
73
-205
-306
-516
-633
-2131
206
205
306
464
168
1349
notquantified
Bote :Figures are illuçtrative only

-47-Statement 3
Table S«3.3 .Present Discounted Values ofCoats andBenefits
(continued )(millions ofecu ,discounted to1985 at peryear )
Low Growth
Costs andBenefits toRailwaysProject
Gotthard Brenner Splugen
Saved operating oosts -freight
-passengers
New revenues
Lost revenues-freight
-passengers
-freight
-passengers
Track maintenance
Netrailway operating surplus
Capital costs
Costs and Benefits ±oUsers
Saved costs of
Rerouting
Fare reductions
Time savings
Netconsumer surplus
Other Items
Environmntal impact
Régional impact
Impact ontrade génération-freight
-passengers
-freight
-business
-other499
59
50
609
-1230
198
84
282152
39
26
217
•1803
205
44
"249101
84
64
-137
-229
-516
-632
-2131
229
137
222
81
"668
notquantified
Notsi iFigures areillustrâtes only

-'-ab1e Distribution ofOperating Benefits Between Nations
(millions ofecu3 ,discounted to1985 at3%peryear )
LowGrowth High growth
Gotthard Brermer Splugen Gotthard Brenner Splugen
Benefits torailways
-Germany 13 10 -151 283 175 132
-Italy 8 172 130 170 193 299
EEC 20 181 -21 434 368 431
-Switzerland 589 - -839 678 - -546
-Austria 36 227 - 748
Total non-EEC 589 36 -611 678 139 202
Total railway benefits 609 217 -632 1132 508 633
Benefits tousers
-Germany 20 55 122 53 131 299
-Italy 124 102 302 334 244 618
-other EEC 37 15 48 99 36 85
Total EEC 180 172 472 485 411 1001
-Switzerland 62 10 106 167 24 188
-Austria - 35 16 - 83 28
-other non-EEC v 39 32 74 106 77 132
Total non-EEC 101 77 196 273 184 348
Total user benefits 281 249 668 758 595 1349

PREFERREDOPTIONSFORTRANSALPINE RAILTRANSPORT
[ILLUSTRATIVE ONLY]
NONEWTUNNEL
PREFERREDGOTTHARD
PREFERRED
SPLUGEN
PREFERRED
Ιο*_i
High
TrafficgrowthassumptionHigh+100%

-50-Statement 3
7Question 0 (Justify Community fiancial support fortheproject
(provide anindication oftheprofitability ofthe
project atthenational level and show how the
project relates tonational budgeting )
Theproject raises anumber ofimportant andinteresting issues .
Itisclear that onthe basis ofcurrent railway distance based
tariffs theprojects have little chance ofbeing viable .Asthe
users oftheprojects ,mainly freight forwarders will however
derive substantial benefits thequestion iswhether freight
rates should not beincreased tohelp pay for theproject .
However ,there arecomplications .Inthecase ofsay ,theGothard ,
ifSwiss railways increased their rates they would risk
diverting traffic toeither French orAustrian railways -orto
road transport .Theonly solution tothis would beforall
railways toincrease their rates andalso tocontrol road tariffs .
Assuch anarrangement would impose very considerable practical
difficulties the solution ofdirect Community support is
preferable .
Afurther difficulty here concerns thequestion ofatransfer toa
non-Member country ,Switzerland orAustria .Inview ofthe
possibilities open todevise some form oftreaty safeguarding
theposition oftheCommunity this should notpose real difficultie
Regarding' thechoice between projects itisclear that traffic
growth iscrucial .Inthehigh grow,th scenario theGothard
project appears best .However ,oneofthereasons forthe
attraction oftheGothard isthe fact that current traffic
matters Lombardia-Ruhr ,favour it :itmaybethat ina
high growth scenario these patterns will change .This point
merits greater attention .Again inthecase oftheBrenner the
existing route ismore difficult andexpensive tooperate than
Swiss routes .Therefore interms ofreduced operating costs
theBrenner hascertain advantages .These various issues
require further attention hence nofinal decision ispossible .
Itispossible toconclude that prima facia thequestion isof
Community interest butmore work will beneeded toarrive at
firm proposals forCommunity act :on.