CL734 TRAFFIC ENGINEERING AND DESIGN

[3 1 0 4]

Course Learning Outcomes:

After successful completion of the course, students
will be able to:
Perform traffic studies, analysis and design road
network
Develop engineering solutions to ease traffic
congestion in cities and improve road safety
Perform economic analysis of transportation
projects

Syllabus
Traffic Engineering and Characteristics: Importance and
scope of traffic engineering, traffic characteristics, human
factors governing road user characteristics, vehicular
characteristics.
Traffic Engineering Studies and Analysis: traffic volume
studies and analysis, speed studies and analysis, origin
and destination studies and analysis, parking studies and
analysis.
Fundamental parameters and relations of traffic flow:
Traffic stream flow characteristics, Speed-Flow-Density
relations, travel time, headway, spacing, time-space
diagram, time mean speed, space mean speed and their
relation,
relation
between
speeds,
flow,
density,
fundamental diagrams; Passenger car units, Capacity and
level of service.

Syllabus
Traffic Regulation and Control: Regulations and controls
on driver, vehicle controls, flow regulations, parking
regulations, general controls, enforcement of regulations,
traffic signs and signal design, road markings, road
intersections and design, design of rotary intersections,
design of parking facilities, traffic control aids and street
furniture.
Traffic Safety and urban congestion: Road accidentsCauses
and
prevention,
accident
analysis
and
investigation, planning and design of pedestrian facilities,
street lighting, road safety issues, traffic management and
traffic forecasting, traffic and the environment, nature of
traffic problems in cities, public and intermediate
transport, use of technology to improve transportation
systems, intelligent transportation systems(ITS)

Syllabus
Transport
Economics:
Economic
evaluation
of
transportation plans, Vehicle operating costs, value of
travel time savings, traffic congestion, traffic restraints and
road pricing.
References:
Dr. L.R Kadiyali, Traffic Engineering and Transport Planning,
Khanna Publishers
S.K Khanna, C.E.G Justo, A. Veeraragavan, Highway
Engineering.
C. Jotinkhisty, B. Kent Lall, Transportation Engineering: an
Introduction, PHI Learning, Eastern Economy Edition.
Mike Slinn, Peter Guest and Paul Matthews, Traffic Engineering
Design, Elsevier.

Transport Economics
Economics Evaluation of Transportation Plans
Basics of Economic Evaluation:
Need for Economic Evaluation: (Role)
A developing country like India has serious shortages
of resources needed for economics development.
The outlay for various sectors of economic activity is
decided by planning at the national level, keeping in
view of the national goals & policies.

Role of Economic Evaluation

Within
the
allocation
earmarked
for
the
transportation sector, a number of schemes can be
taken up each enjoying its own urgency &
attractiveness.
It thus becomes necessary to screen & evaluate
various alternatives so that a wise decision can be
reached on the most appropriate choice.
This can be achieved by modern techniques of
economic evaluation of transportation projects.

Role of Economic Evaluation

Economic Evaluation is a rational approach of
quantifying the future benefits & costs of
proposed transportation plans.
Economic Evaluation also attempts to determine
the extent to which the project will contribute to
the goal of raising the living standards of the
people & their welfare.

Role of Economic Evaluation

Economic analysis or evaluation of highway
project can be carried out to weigh other
alternative transport projects such as railways,
pipelines or inland water transport project, in
order to select the most beneficial scheme.

Objectives of Economic Evaluation

To decide whether the plan under consideration
is worth investing at all.
To rank the schemes competing for scarce
resources in order of priority.
To
compare
various
alternative/mutually
exclusive schemes & select the most economic
one.
To assist in phasing the programme over a time
period depending upon the availability of
resources.

Objectives of Economic Evaluation

In economic evaluation, all past actions are
irrelevant. What is of prime importance is the
future flow of costs & benefits.
The period of analysis need not be too long
keeping in view the uncertainty associated with
future traffic & benefits.

Aspects of Project Appraisal

Engineering Aspects

Managerial Aspects
Financial Aspects
Economic Aspects

Engineering Aspects

Deal

primarily

with

the

technical

construction process and the operation of

the project after it is completed, as well as
with the estimates of capital and operating
costs.

Managerial Aspects
Deal with the multitude of management and
staffing problems involved in constructing
and operating the project.

Financial Aspects
Deal with the cost and revenue of the
enterprise responsible for the project.

Economic Aspects
Deal with the economic costs and benefits
from the point of view of the country as a
whole

Total Transportation Cost

Construction Cost
Maintenance Cost
Road User Cost

Construction Cost

Survey, Investigation And Design Cost

Land Acquisition Cost
Construction Costs
Physical Contingencies
Supervision, quality Control and Administration
Charges

Maintenance Cost

Ordinary repairs
Periodic repairs
Operation expenses
Supervision and operational charges

Road User Cost

Benefits from Highway

Improvements
Road user benefits
Vehicle operating cost saving
Value of travel time savings
Value of savings in accident cost
Savings in maintenance cost

Benefits from Highway

Improvements
Social benefits
Improvement in administration. Law and
order and defense
Improvements in health and education
Improvements in agriculture, industry,
trade, mining and environmental standards
Appreciation in value of land adjacent to
roads.

Stages Involved In Economic Evaluation

Identification and definition of project
Collection of economic based data
Traffic surveys in existing facilities
Selection of policy variable for analysis and
decision
Inventory of existing roads
Traffic projections

Stages Involved In Economic Evaluation

Engineering design of proposed alternative
schemes
Estimation of cost of new facility as per all
alternatives considered
Traffic analysis of existing road and new facility
Estimation of user benefits
Economic analysis

Cost & Benefit of a Transportation

Project
The basic principle of economic evaluation is to
measure the cost of the project, determine the
benefits that are likely to accrue and compare
the two.
Identification and quantification of the impact of
the transportation plan is the most difficult part
of economic evaluation.

COST
1. Capital cost of Initial Construction (should include
land cost and ancillary cost)
2. Cost of delays to vehicles during the period of
construction
3. Maintenance cost
4. Road User Cost
The above cost components are interdependent,
hence the designer has to select that alternative in
which the sum total of all three is minimum.

BENEFITS
Benefit is usually the difference between the cost of
operating on a new transport facility and the cost
of operating on an existing facility.
Thus, in order to determine the benefits, it is
necessary to determine the cost of operation.

Benefits can be grouped under the

following heads:
1. Benefits to the existing traffic in terms of reduced
operating costs, savings in travel time and
reduction in accidents.
2. Benefits to the generated traffic.
3. Benefits to the traffic diverted from other routes.
4. Benefits to the traffic operating on other roads.
5. Indirect benefits (change in property values,
savings enjoyed by vehicle owners may be
transmitted to other sectors.)

Summarizing Basic Concepts of

Economic Evaluation
National view point
Difference between economic analysis and financial
analysis
Analysis is a study of future
All possible alternatives should be considered
Cost and benefit components of equal magnitude
All consequences should be considered
Analysis period should not extend beyond the period
of reliable forecasts
All future cash flows to be brought to a common
time datum

COMPOUND INTEREST EQUATIONS

P= Present sum of money

i= Interest rate (compound) per annum
N= Number of years
F= Sum of money at a future date
A= End of year equal annual payments
for n years

COMPOUND INTEREST
EQUATIONS

Tutorial-1
Answer the following:
1. Find the future worth of Rs 1,00,000 at the end of 20 years
invested at a compound rate of interest of 12% per annum.
2. What is the present worth of a sum of Rs. 75,000 at the end
of 10 years when the discount rate is 10% per annum.
3. The annual cost of maintenance of a new road thrown open
to traffic is Rs. 15,00,000. What is the future worth of this
expenditure at the end of 10 years when the rate of interest
is 15% per annum?
4. A major rehabilitation of a pavement will be done 10 years
from here at a cost of Rs. 100 lakhs. What should be the
series of uniform annual payments that must be set apart
to accumulate this amount, if the interest rate is 9% per
annum.

Tutorial-1
5. The annual maintenance cost of a major bridge is Rs. 10,000.
what is the present worth of this cost incurred for 10 years after
the opening of the bridge? The discount rate may be taken as
12% per annum.
6. The cost of construction of a new facility is Rs.100 crores at
current price, and is met with by raising a loan. What is the
annual payment of equal amount for 20 years to repay the loan,
if the rate of interest is 10% per annum?
7. As a routine maintenance work, Rs.20,00,000/- each is to be
spent on a particular stretch of a highway during the 3rd year,
5th year and the 7th year. Calculate the total present worth of
these expenditures, if the annual discount rate is 12%
(compound).
8. The expenditure of construction of new highway was estimated
as Rs. 200 crore. It was decided that this money will be raised
from loans. What is the equal amount of money to be paid each
year, such that the loan is repaid by 15 years? Assume
compound rate of interest as 10%.

Annual Highway Cost

Items to be included while computing annual highway
cost:
A portion of administrative cost such as personnel,
services, building, equipment & their operation,
office, insurance, etc.
Highway operation including equipment, capital cost
of vehicle and vehicle operation cost.
Capital cost of highway components such as right of
way, earthwork, drainage system, pavement layers,
bridges & traffic services, depreciation cost and
interest on investment.

Annual Highway Cost

Highway maintenance cost
Probable life and salvage value of each component
at the end of this period.
The annual average highway cost for a road system
may be summed up by the formula:
Ca = H + T + M + Cr
Where,

Ca = avg annual cost of ownership and operation

H = avg cost of highway administration and management
T = avg annual highway operation cost
M = avg annual highway maintenance cost
Cr = capital cost of depreciation of investment plus interest on capital or
simply the capital recovery with return on capital. Cr = (P*CRF)

Annual Highway Cost

At the end of the service life of road pavement, some
items could be assigned some salvage value. However
the salvage value for a few other items may be
negligible.
The avg annual capital cost Cr for a project
considering salvage value may be estimated by the
use of the formula ( capital recovery with salvage
value):
Cr = (C Vs)CRF + (iVs) Where,
C = Total investment on construction
Vs = salvage value at the end of 10years.

METHODS OF ECONOMIC EVALUATION

OF TRANSPORTATION PROJECTS
1. Rate of Return Methods:
1. Benefit cost (B/C) ratio method
2. First year rate of return method (FYRR)

2. Discounting cash flow methods:

1. Net Present Value method (NPV)
2. Internal Rate of return method (IRR)

Benefit cost (B/C) ratio method

Widely used method for evaluation of highway
projects & is basis of AASTHO road user
analysis.
In cost benefit ratio analysis, the costs and the
benefits of individual highway projects are
calculated, bringing all the expenditures to the
base year for comparison purposes.
The cost-benefit ratios of the various alternative
highway projects are then compared.

Benefit cost (B/C) ratio method

The ratio of net annual benefits to the net annual
cost is determined.
B/C = Benefits in the reference year/Annual costs

B/C ratio =

(RUC for existing road RUC

for improved road) in the reference year
(Equivalent annual highway cost for the
improved road - Equivalent annual highway
cost for the existing road)

B/C ratio should be greater than 1 for economically

viable projects.

First Year Rate of Return

In this method the benefits accruing in the first
year of the schemes operation alone are
compared with the capital cost of construction
The result expressing the benefits occurring in
the first year as a percentage of costs, is called
first year rate of return.
FYRR = Benefits accruing in the first year
Capital Costs

Net Present Value Method (NPV)

NPV is based on discounted cash flow (DCF)
technique.
In this method the stream of costs/ benefits
associated with the project over an extended period
of time is calculated and is discounted at a selected
discount rate to give the present value.
Benefits are treated as positive and cost as
negative and the summation gives the net present
value (NPV).

Net Present Value Method (NPV)

Any project with positive NPV is treated as
acceptable.
In comparing more than one project, a project with
higher NPV should be accepted.
The net present value is algebraically expressed as:

Where, NPV0 = net present value in the year 0

Bt = value of benefits which occur in the year t
Ct = value of costs which occur in the year t
i = discount rate per annum
n = number of years for which the return is to be calculated

Net Present Value Method (NPV)

Improvement cost of an existing road, 25 Km
long is Rs. 4 lakhs per Km. Road user costs,
with and without improvements, accident
costs, with and without improvements and
maintenance
costs,
with
and
without
improvements are given in the table for a 10
year
period
after
completion
of
the
improvements. Assuming a discount rate of
10%, find out whether the project is
economically feasible or not by NPV method.

TRANSPORTATION ECONOMICS
In transport economics interaction between
transportation demand (e.g., the desire to make
trips, with the ability to pay for it) and
transportation supply (e.g., the availability of traffic
lanes to make the trips) are examined.

Transportation Economics
Economists conveniently divide the broad area of
economics into two main streams.
Microeconomics concerns itself with the study of
economic laws as affecting a firm on a small scale.
It deals with the economic behavior of individual
units such as consumers, firms, and resource
owners.
Macroeconomics is the study, on the national and
international scale, of the wealth of society.

TRANSPORTATION DEMAND
The demand for goods and services, in general,
depends largely on consumers income and the price
of the particular good or service relative to other
prices.
For example, the demand for travel depends on the
income of the traveler.
The choice of the travel mode depends on several
factors, such as the purpose of the trip, the distance
travelled and the income of the traveler.
A demand function for a particular product
represents the willingness of consumers to purchase
the product at alternative prices.

TRANSPORTATION DEMAND
A demand function shows,
for example, a number of
passengers willing to use a
commuter train at different
price levels between a pair
of origins and destinations,
for a specific trip, during a
given period.

PRICE
The term price stands for all outlays perceived by the
traveler for a given trip.
The price for the trip could be out-of-pocket costs
(the train fare); travel time including access, waiting,
and in-vehicle time; comfort; safety; convenience;
reliability; and several other tangible and intangible
factors.
Most of the components of the perceived price for
travel can be measured and expressed in monetary
units.
This synthetic price is sometimes called a
generalized price.

DEMAND, SUPPLY, AND EQUILIBRIUM

We have seen that the demand function is a relation
b/w the quantity demanded of a good and its price.
In a similar manner, the supply function represents the
quantity of goods a producer is willing to offer at a given
price for example, bus seats at a given price, and tons
of wheat at a given price.
If the demand and supply functions for a transportation
facility are known, then it is possible to deal with the
concept of equilibrium.
Equilibrium is said to be attained when factors that
affect the quantity demanded and those that determine
the quantity supplied result in being statically equal (or
converging towards equilibrium).