Comment 101293

By kevlahan (registered) | Posted May 12, 2014 at 22:04:15 in reply to Comment 101286

I agree that we need to be careful about how to compare costs, especially when the terminology is not always clear (e.g. Calgary's report calls 'total operating costs' what Hamilton calls 'net operating costs').

The $0.25 figure for the C-line was the one provided to Hamilton staff and councillors by Calgary Transit when they toured Calgary's system several years ago.

Let's carefully examine the numbers in context, and compare them with the estimated numbers from Hamilton's Rapid Ready Report.

Calgary's report

gives the precise net operating cost of $0.27 per passenger for Calgary's LRT compared with $1.50 for bus passengers, i.e. about 6 times cheaper.

Hamilton's Rapid Ready Report (Appendix A) estimates the current net operating cost per passenger as $1.07 on the B-line bus route (the most profitable corridor) and a system-wide net operating cost of $2.00 in 2012 (total cost of service is about $3.59 including fare revenue).

Thus, based on the Calgary experience we could reasonably expect the net operating cost to eventually be about 4 times cheaper if we switched the B-line to LRT and the overall operating cost of the bus+LRT system could drop by about 25%.

The rapid ready report estimates that based on the experience of other systems the likely Day 1 net operating costs on the B-line would drop from $1.07 to $0.45 as there would be an 8% increase in total system ridership, but the net system cost would remain the same at $2.00.

The expected 8% increase would place Hamilton's LRT sixth out of 24 North American systems in terms of ridership on opening day.

With the existing bus network + B-line LRT they estimate that by 2031 the overall cost per passenger would drop to $1.51, while keeping the existing bus only system would increase net costs to $2.28 (i.e. about 50% more expensive per passenger).

The bottom line is that net cost per passenger to the City of operating the B-line would likely drop by a factor of more than two one day one, and that the net operating per passenger cost of operating the entire HSR system would also likely drop by 50% compared with a bus only system over the longer term. These are significant savings for a much higher capacity and attractive system.

It is important to note that the consultants deliberately made very conservative "worst case" assumptions in all their estimated benefits of LRT:

The benefits captured within this report have used conservative values (i.e. worst case scenario values to ensure that the benefits are cautious rather than optimistic).

The likely benefits (both cost savings and economic investment) are therefore much greater than the estimates in the Rapid Ready Report, and Calgary's experience gives a pretty good guide as what we can expect. We should also not forget that Hamilton's Main/King corridor buses (e.g. 1, 5, 10, 51) are currently way over capacity with multiple drive-bys and it desperately needs increased service levels that will be hard to achieve using conventional buses. LRT is a good cost-effective way of providing the necessary increased service and attracting much needed economic development.

Comment edited by kevlahan on 2014-05-12 22:36:12

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