MADRID METRO LINE ACCESS TO BARAJAS AIRPORT

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1 EX POST EVALUATION OF INVESTMENT PROJECTS CO-FINANCED BY THE EUROPEAN REGIONAL DEVELOPMENT FUND (ERDF) OR COHESION FUND (CF) IN THE PERIOD MADRID METRO LINE ACCESS TO BARAJAS AIRPORT REPARED BY : BARCELONA IN PARTNERSHIP WITH CSIL, C ENTRE FOR I NDUSTRIAL S TUDIES, M ILAN P CENIT, C ENTRE FOR I NNOVATION IN T RANSPORT, P REPARED FOR: EUROPEAN COMMISSION DIRECTORATE-GENERAL REGIONAL POLICY P OLICY DEVELOPMENT E VALUATION B ARCELONA, S EP TEMBER 5, 2012

2 This study is carried out by a team selected by the Evaluation Unit, DG Regional Policy, European Commission, through a call for tenders by open procedure no 2010.CE.16.B.AT.036. The consortium selected comprises CSIL Centre for Industrial Studies (lead partner Milan) and DKM Economic Consultants (Dublin). The Core Team comprises: - Scientific Director: Massimo Florio, CSIL and University of Milan; - Project Coordinators: Silvia Vignetti and Julie Pellegrin, CSIL; - External experts: Ginés de Rus (University of Las Palmas, Spain), Per-Olov Johansson (Stockholm School of Economics, Sweden) and Eduardo Ley (World Bank, Washington); - Senior experts: Ugo Finzi, Mario Genco, Annette Hughes and Marcello Martinez; - Task managers: John Lawlor, Julie Pellegrin and Davide Sartori; - Project analysts: Emanuela Sirtori, Gelsomina Catalano and Rory Mc Monagle. A network of country experts provides the geographical coverage for the field analysis: Roland Blomeyer, Fernando Santos (Blomeyer and Sanz Guadalajara), Andrea Moroni (CSIL Milano), Antonis Moussios, Panos Liveris (Eurotec - Thessaloniki), Marta Sánchez-Borràs, Mateu Turró (CENIT Barcelona), Ernestine Woelger (DKM Dublin). The authors of this report are Mateu Turró and Marta Sánchez-Borràs (CENIT - Barcelona) and CSIL for the CBA. The authors are grateful for the very helpful comments from the EC staff and particularly to Veronica Gaffey, José-Luís Calvo de Celis and Kai Stryczynski. They also express their gratitude to all stakeholders who agreed to respond to the team s questions and contributed to the realisation of the case study. The authors are responsible for any remaining errors or omissions. Quotation is authorised as long as the source is acknowledged. Cover: Metro station Aeropuerto T1 T2 T3. Source: Urbanrail.net.

3 TABLE OF CONTENTS EXECUTIVE SUMMARY PROJECT DESCRIPTION CONTEXT STRUCTURAL FEATURES AND SERVICE DELIVERED TARGET POPULATION CURRENT PERFORMANCE ORIGIN AND HISTORY CONTEXT FOR THE PROJECT KEY STAKEHOLDERS AND MANAGEMENT STRUCTURES MAIN DEVELOPMENTS SINCE COMPLETION HAS THE PROJECT STABILISED? LONG-TERM DEVELOPMENT EFFECTS KEY FINDINGS DIRECT ECONOMIC GROWTH ENDOGENOUS DYNAMICS TERRITORIAL COHESION SOCIAL COHESION ENVIRONMENTAL EFFECTS INSTITUTIONAL QUALITY SOCIAL HAPPINESS DETERMINANTS OF PROJECT OUTCOMES APPROPRIATENESS TO THE CONTEXT PROJECT DESIGN FORECASTING CAPACITY MANAGERIAL RESPONSE PROJECT GOVERNANCE INFLUENCE OF AND INTERPLAY BETWEEN DRIVERS CONCLUSIONS ANNEX I. METHODOLOGY OF EVALUATION ANNEX II. COST-BENEFIT ANALYSIS ANNEX III. MAP OF STAKEHOLDERS ANNEX IV. LIST OF INTERVIEWEES ANNEX V. REFERENCES

4 LIST OF ABBREVIATIONS AENA ATM ATO ATP CBA CF CM CRTM DG Regio EC EIB EMT EU GDP GHG ICP IFEMA INE IRR MINTRA NPV pax PPP RACC RENFE Spanish airports and air navigation (Aeropuertos Españoles y Navegación Aérea) Metropolitan Transport Authority (Autoritat del Transport Metropolità) Automatic Train Operation Automatic Train Protection Cost-Benefit Analysis Cohesion Fund Community of Madrid (Comunidad de Madrid) Regional Consortium of Madrid Transport (Consorcio Regional de Transportes de Madrid) Directorate General for Regional Policies European Commission European Investment Bank Metropolitan Body of Transport (Entidad Metropolitana del Transporte) European Union Gross Domestic Product Greenhouse Gas Index of perceived quality (Indicador de Calidad Percibida) Institute of Madrid Fair (Institución Ferial de Madrid) National Institute of Statistics (Instituto Nacional de Estadística) Internal Rate of Return Madrid Transport Infrastructures (Madrid Infraestructuras del Transporte) Net Present Value Passengers Public-Private Partnership Royal Automobile Club of Catalonia (Real Automóvil Club de Cataluña) National Network of Spanish Railways (Red Nacional de Ferrocarriles Españoles)

5 S.A. TEN-T TFM UIC VVTS WGI WHO Public Limited Company (Sociedad Autonoma) Trans-European Transport Network Railway Transport of Madrid (Transportes Ferroviarios de Madrid) International Union of Railways Value of Travel Time Saving Worldwide Governance Indicators World Health Organisation

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7 EXECUTIVE SUMMARY This case study illustrates the story of the Madrid Metro Line 8, a major infrastructure investment co-financed by the EU over the period More specifically, this is an expost evaluation assessing the long-term effects produced by the project and interpreting the key determinants of the observed performance. The analysis draws from an ex-post Cost- Benefit Analysis (CBA) 1 and from an extensive set of qualitative evidence, both secondary (technical reports, official reports, press articles, books and research papers) and primary (interviews with key stakeholders and experts have been carried out in the period March to November ). The overall approach and methodology followed in the evaluation study is briefly recalled in the box overleaf and more extensively in Annex I. OVERALL APPROACH AND METHODOLOGY The Conceptual Framework delivered in the First Intermediate Report has been developed from the evaluation questions included in the ToR 3, and further specified and organised in accordance with the study team s understanding. In particular, the Team identified three relevant dimensions of analysis: a. The object of the evaluation (the WHAT ): this relates to the typologies of long-term contributions that can be observed. Starting from the typologies identified in the ToR (socio-economic development and quality of life) the Team developed the following classification of long-term effects: Economic development (including effects on GDP growth and endogenous dynamics) and Quality of life, taken here to be synonymous with additional social wellbeing, i.e. including effects that are not captured by the economic variables. Quality of life, in turn, has been divided into: social cohesion, territorial cohesion, institutional learning, environmental effects and social happiness. b. The timing of the long-term effects (the WHEN ): this dimension relates to the point in the project s lifetime at which the effects materialise for the first time (short-term dimension) and stabilise (long-term dimension). The proper timing of an evaluation and the role it can have in relation to the project s implementation is also discussed here. c. The determinants of the project s performance (the HOW ): the assumption here is that five aspects of project s implementation and their interplay are crucial for the project s final performance. These aspects are: project design, forecasting capacity, governance, context and managerial response. Five Working Hypotheses are related to these dimensions and explain how each of them can influence the generation of the project s short or long-term effects. On the basis of this conceptualisation, a set of detailed evaluation questions are developed, which aim to guide the entire study and to support the provision of conclusions and recommendations. The methodology developed to answer the evaluation questions consists of a combination of quantitative (Cost Benefit Analysis) and qualitative (interviews, surveys, searches of government and newspaper archives, etc.) techniques, integrated in such a way as to produce ten project histories. CBA 1 Data, hypotheses and results are discussed in Annex I. 2 See Annex III for a detailed list of interviewees. 3 They are the following: What kind of long-term contributions can be identified for different types of investment in the field of environment and transport infrastructure? How are these long-term contributions generated for different types of investment in the field of environment and transport infrastructure, i.e., what is the causal chain between certain short-term socio-economic returns and long-term returns from investment? What is the minimum and average time needed for a given long-term contribution to materialise and stabilise? What are these time spans for different types of investment in the field of environment and transport infrastructure? What are the existing evaluation methods to capture a given long-term contribution for different types of investment in the field of environment and transport infrastructure? 1

8 is an appropriate analytical approach for the ex-post evaluation because it can provide quantification of or indications of some of the long-term effects produced by the project. However, the most important contribution of the CBA exercise is to provide a framework of analysis to identify the most crucial aspects of the projects ex-post performance and final outcome. Qualitative analysis on the other had is more focussed on understanding the underlying causes and courses of action of the delivery process. On the basis of the findings of the ten case studies, the Final Report will draw lessons along the key dimensions identified of what, when and how. Source: CSIL Milano Line 8 of the Madrid Metro is an external radial line of the network, which runs between the centre and the northeast of the city linking the core business centre of Madrid and Barajas International Airport. Line 8 offers a quick and reliable public transport connection to residents and employees of businesses located near its stations in central Madrid and in Barajas village. Located 12 km to the East of the Madrid municipal area, Madrid-Barajas airport is a major national and European airport handling close to 50 million passengers and over 685,000 tonnes of freight per year. Barajas has always had very good access by road - indeed it was the European airport with the highest share of people accessing by car (86.7% 4 ) - but, until 1999, it was not efficiently connected to the city via reliable public transport. There was, thus, a wellestablished need to improve public transport connections to Madrid-Barajas airport. Since the late Sixties, the idea of connecting Madrid s city centre with the airport by rail had been under study; however, it was not until the approval of the metropolitan rail network Extension Plan ( ) that the idea was seriously considered. During the Nineties, Madrid s and its peripheral districts population experienced a significant process of urban expansion as well as a relocation of economic activities, mostly to the outskirts of the metropolitan area. This led to a substantial growth in mobility between the city of Madrid and its surroundings, which provoked heavy congestion on Madrid s access routes. In this context, the creation of a Metro Line was considered the best option to link Madrid-Barajas airport, Madrid s Fair, located nearby the airport, and the surrounding residential areas. The development of Line 8 was carried out in three stages, in response to the evolution of the needs and objectives of the city. Firstly, the Extension Plan envisaged the construction of a metro section between Barajas village and the station of Mar de Cristal, so as to connect Madrid to the airport. The European Commission Directorate-General Regional Policy (DG Regio), however, highlighted that this initial project idea would have allowed limited penetration of the city and few interchange possibilities with other public transport system lines. The Commission considered that, in order to be eligible for Cohesion Funds, the line had to provide very good access to a significant share of Madrid s population and airport users; more specifically, the Airport connection to a main interchange in the city centre was required. Consequently, the metro section between Mar de Cristal and Nuevos Ministerios, in downtown Madrid, was included in the subsequent Metro Extension Plan ( ). In a 4 Referred to

9 third phase, finished in 2007, as a result of an important expansion plan at Madrid Airport, the line was extended to the new T-4 terminal building and a new intermediate station was built at Pinar del Rey. The project under assessment involved an investment cost of EUR 462 million between 1997 and 2002, 85% of which co-financed through the Cohesion Fund. A further investment of EUR 55.9 million was financed between 2006 and 2007 to extend the line, thus making EUR 518 million the total investment cost considered in the analysis. The Cohesion Fund contributed to cover about 76% of the total investment cost, while the remainder was covered by regional public funds. From a financial sustainability perspective, it can be stated that the revenues generated by the project from tariffs are not enough to cover its operating and maintenance costs. Instead, the coverage of costs is ensured by the large degree of public subsidisation of the sector. OVERVIEW OF INVESTMENT COSTS AND SOURCES OF FINANCING Financing period ; First year of operation 1998 Total investment costs (2011 prices) EUR million 100% Sources of financing and co-funding rates over the total investment costs Cohesion Fund EUR 393 million 76% European Regional Development Fund EUR 0 0% European Investment Bank EUR 0 0% National-regional-local public contribution EUR 125 million 24% Private capital EUR 0 0% The number of passengers accessing the Metro Line 8 at the airport stations has increased over the period , and then stabilised at some 35 million users per year. In total, the number of passengers joining the metro network at the Barajas terminal stations or leaving the system through the same stations represents about one third of the total number of Line 8 passengers. However, the demand is probably not yet completely stabilised: in November 2010, new bus lines connecting the city to the airport have been provided by the service operators: the improvement in the bus network system, which constitutes a direct public transport competitor for Metro Line 8, to some extent may affect the future Line s 8 demand. Madrid s Metro network has been extended by many kilometres of new lines over the last two decades, but the Extension Plan , in which the creation of Line 8 was included, was unprecedented, as it extended the subway network by 56 new kilometres of new lines and 38 new stations. As a consequence of this, Madrid has become one of the best cities in Europe in terms of external and internal transport links, which are amongst the most important factors when deciding where to locate a business. Line 8 has facilitated the location of new businesses in Madrid, with direct impacts on economic growth and, thanks to its high connectivity with the public transport system, it has prevented the concentration of commercial activity in the areas closest to the airport, and helped to disperse economic dynamics and social welfare over the entire area between the Barajas village and the city. Significant efficiency benefits also 3

10 come from time savings and reliability gains for public transport users and from reductions both in operating costs and accidents for former private car users. The line generated a positive economic return also due to cost savings for diverted traffic and to the reduction in externalities due to the change to a cleaner mode of transport. Indeed, the modal shift of motorised transport users to an environmentally friendly alternative has been highly positive for environmental quality in a polluted city such as Madrid. Reducing traffic on congested major roads has had particularly high impacts on greenhouse gas emissions. These benefits have been quantified in the ex-post CBA. The analysis indicates the economic Net Present Value of the project amounts to EUR 2,636 million, with an internal rate of return of 16.87%: such results confirm that, from an economic perspective, the project was justified. With regard to economic endogenous dynamics, the line has enhanced the integration into the city of two important and peripheral infrastructures for Madrid: its international hub airport and IFEMA (Institute of Madrid Fair), the 4 th largest trade fair in Europe in number of attendees. By providing them with a direct and reliable connection to the city centre, the project contributed to their development. On one hand, the fair has favoured the exchange of know-how and the establishment of commercial agreements with international firms, which in turn have widened the competences of local companies; on the other hand, the good transport connection has increased the productivity of companies, as it has facilitated access to their suppliers and customers. Moreover, the construction of Nuevos Ministerios station was complex, requiring a high level of technical skills, and marked a change in the way of conceiving the design of interchange nodes: actually, the station was articulated as a large, functional and user-oriented space. This knowledge has overflowed into the construction of subway stations in many other cities around the world. The expansion of the network towards the periphery represented a considerable improvement in connectivity and territorial cohesion as it reduced welfare disparities caused by unequal distribution of resources and opportunities among the region s inhabitants. Bringing a quality and affordable public transport service closer to some residents of surrounding municipalities has also had a positive impact on social cohesion by enabling vulnerable social groups, particularly immigrants with lower incomes, living in the suburbs, to more easily access the city centre, and by lowering their generalised transport costs, even in terms of time spent commuting. Finally, as for the institutions involved in the project, the existence of a metropolitan transport agency, CRTM (Regional Consortium of Madrid Transport), with strong participation by the local authorities greatly facilitated the execution of Line 8. Since then, the management system of transport projects through consortia has spread throughout Spain, which has now more than 20 similar authorities. The European Commission also definitely contributed to a better design of the line, as it required the rapid extension of the airport connection to the core business centre of Madrid, thus maximising the demand and the level of modal transfer. The institutional, economic, social and cultural context played a non-minor role in the project s success. As mentioned before, the metropolitan outskirts of Madrid were experiencing 4

11 significant residential growth, leading to an increase in centre-periphery transport flows. The context was highly positive for the project also considering the steady growth of visitors and exhibitors at Madrid s Fair since 1990, together with the planned expansion of Barajas airport and its positioning as Spain s international hub. In addition, the project benefited from the fact that, since 1991, the city of Madrid has been under the government of the same political party. This has facilitated good decision-making capacity, with long-term vision, and enabled the completion of projects such as the metro network expansion, which are planned in different stages. The success of the project was also largely due to its accurate project design and good forecasting capacity. Being in a densely populated city with a multitude of services buried under the pavement, which give rise to many potential restrictions and risks for the construction, the project called for meticulous control and special construction techniques. With the aim of anticipating possible accidents during the operational phase, advanced security and control systems were installed. Furthermore, the collaboration of skilled professionals allowed the project to promptly react and overcome unpredicted events that arose during the works, such as the discovery of polluting filtrations in the ground. Thanks to the good planning capacity and project design, the project s construction was completed without any delays and cost overruns. The well-defined roles and responsibilities of the different transport and government institutions and their experience in the transport sector within the Madrid Community positively influenced the project s outcome. With regard to the extension of Metro Line 8 to the subsequently commissioned T4 airport terminal, the Public-Private Partnership contract established was probably essential for the early completion of the whole line as it facilitated financing and construction bidding procedures. An absence of coordination between two governmental levels (central and local) and the defence of their own and conflicting interests (a rail service versus a metro line) were revealed during the project planning and execution, but it did not significantly affected the project performance. In spite of some uncertainty concerning the future demand of Line 8, which depends on the offer of alternative transport modes (such as bus lines) and on the future development of the Barajas airport, the project s effects are considered mostly stabilised. In conclusion, the Madrid Metro Line represents a successful example of infrastructural project which managed to deliver all the expected benefits at the expected time and costs. This was achieved mainly thanks to the adoption of a wide and long-term plan, ensuring a joint analysis of local and long distance transport needs and good inter-modality, which in turn led to a globally efficient solution. The European Commission played a crucial role in this respect, by pushing the local authorities to undertake a broader view in the project design, thus ensuring the maximisation of the project s impact. 5

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13 1 PROJECT DESCRIPTION This section contains a brief description of Madrid Metro Line 8, which provides access to Barajas airport. The key structural features of the infrastructure and the service delivered, the context in which it takes place, the target population and the current performance of the project are outlined, in order to give a general description of the project. 1.1 CONTEXT Situated right in the centre of the country, Madrid is Spain s capital and biggest city, with 3,265,038 inhabitants in its municipality (INE, 2011) 5, divided in 21 districts that, in turn, make up of a total of 128 neighbourhoods. It is the third largest city in the European Union behind Berlin and London. Its metropolitan area is home to 6,043,031 inhabitants 6, making it the third largest metropolitan area in the EU, behind Paris and London 7. The Autonomous Community of Madrid, one of the Spanish regions, extends beyond this area, to cover some 8,021 km 2 and a population of 6,489,680 inhabitants 8. With regard to demographics, Madrid and its peripheral districts experienced, in the Nineties, a significant process of urban expansion. The population living in the central districts grew by 11% between 1996 and 2010, whilst population in the outlying districts grew by 16% and in the metropolitan area by 48%. Alongside this urban expansion, there was a process of relocation of economic activities, mostly to the outskirts of the metropolitan area. This led to a substantial increase in the flow of people between the city of Madrid and its surroundings: travel to and from the city of Madrid grew by 39% between 1996 and 2004, from 6.9 million to 9.5 million trips per day. However, the highest increases were experienced in movements within the central districts of Madrid (51%). Flows between the central districts and the external metropolitan area increased by 48%, whilst those from the peripheral districts to the centre grew by slightly less (44%). 5 Data provided by the register, January, 1 st, AUDES, Demographia, 2011; City population, INE,

14 Figure 1.1 EVOLUTION OF MADRID CITY (LEFT) AND BARAJAS DISTRICT (RIGHT) POPULATION s t n a i t b a h I n s t n a t i b a h n I Year Year Madrid city Barajas Source: Authors from data provided by Ayuntamiento de Madrid (2011) A combination of structural advantages favours Madrid as an international centre for investment and business 9. Key factors include world-class transport infrastructure and facilities, its role as headquarters and decision centre for national and multinational companies located in Spain, the size of its metropolitan market, with high levels of purchasing power, human resources and professional qualifications, its status as an international financial centre and a concentration of advanced business services and economic and cultural ties that make Madrid a strategic platform from which to enter the Latin American market. Madrid-Barajas airport plays an important role in Madrid's economic strength and international prominence. It is a major national and European airport (Table 1.1), handling close to 50 million passengers and over 685,000 tonnes of freight per annum (2011 figures, AENA, 2011). 9 Gross Foreign Direct Investment in the Madrid region between 1996 and 2010 amounted to EUR billion, representing 59% of total Foreign Direct Investment in Spain. 8

15 Table 1.1 COMPARISON OF TRAFFIC AT THE MAJOR EUROPEAN AIRPORTS, 2010 Airport Thousand passengers % Change in 2010 over 2009 London - Heathrow (UK)* 65, Paris Charles de Gaulle (France)* 58, Frankfurt (Germany)* 53, Madrid-Barajas (Spain)** 49, Amsterdam (Holland)* 45, Rome (Italy)* 36, Munich (Germany)* 34, Istanbul (Turkey)* 32, London - Gatwick (UK)* 31, Barcelona (Spain)** 29, Paris Orly (France)* 25, Note: *: Global ACI data on March 2011, for 2010; **: Definitive Aena data for 2010 Source: AENA (2010) Located 12 km to the East of the Madrid municipal area (see Figure 1.2), Barajas has always had very good road access. However, until the creation of the Metro Line analysed here, there had not been a reliable public transport link to the airport. In 1995, Metro de Madrid presented an ambitious Expansion Plan with the purpose of extending the metro network to peripheral municipalities as well as integrating into the network some city areas that, despite having a small population, played an important role in Madrid. This was the case for Ciudad Universitaria station (L6), which serves Complutense and Politécnica University campuses; Campo de las Naciones (L8), that serves Madrid Fair (IFEMA) and Barajas Airport (L8), which connects the airport to Madrid city centre. Figure 1.2 THE GEOGRAPHICAL POSITION OF MADRID METRO LINE 8 (PINK LINE) Source: NetMaps (2011) 9

16 Currently, rail connections to the airport include the Metro Line 8 (from Nuevos Ministerios to Airport T-4) being evaluated here and, since October 2011, a rail link (Cercanías service 10 ) on Iberian gauge to Chamartín Station, a major intermodal station located in the North of Madrid. To set the context of the project it is also essential to explain the organisation of the metropolitan transport system in Madrid. Its key player is the Regional Consortium of Madrid Transport (Consorcio Regional de Transportes de Madrid - CRTM), a transport authority created in 1985 to handle all public transport modes in the Community of Madrid (CM). Its main tasks are: Planning public transport infrastructure (the metro network, main interchange points in the city); Planning transport services, definition of coordinated programmes of operation for all modes of transport and the control and inspection of services delivered; Establishment of an integrated fare system for the whole public transport system and the definition of its economic-financial framework; Projecting a single image of the public transport system, with CRTM being the only interface with the user. Its efficiency lies on three fundamental pillars. Firstly, management integration. At present, practically all the municipalities (179 municipalities) of the CM are integrated in the CRTM (only 3 municipalities with less than 1,000 inhabitants are not yet integrated) and includes towns from four surrounding provinces belonging to other Autonomous Communities. The Governing Council of CRTM is composed of 20 members, with the following representation: 5 members of CM and 5 of Madrid s City Council; 3 members of municipalities from outside CM, adhered to the CRTM; 2 of the Central Administration; 2 of trade unions; 2 of the business sector and 1 representative of public transport users. The CRTM is thus able to integrate the concerns of all recurrent users (mostly commuters) and is a counterpart of the various government departments responsible for urban development plans in aspects relating to the location of activities and land use. The CRTM has thus the authority to coordinate the various modes of transport and service operators (see Box 1.1 for a list of these operators), ensure proper technical and administrative organisation of transport, and has the power to influence urban planning (which is responsibility of the municipalities and ultimately of the Autonomous Communities) in the direction of compact residential developments and a distribution of activities that is compatible with public transport. 10 Cercanías is the name given by RENFE to the metropolitan rail services of the major Spanish cities (namely Cádiz, Madrid, Málaga, Sevilla, Zaragoza, Asturias, Bilbao, Murcia/Alicante, Santander, San Sebastián, Valencia and Barcelona). Other rail service categories include Regional, Larga Distancia (Long Distance) and Alta Velocidad (High Speed). 10

17 Box 1.1 MADRID S PUBLIC TRANSPORT OPERATORS CRTM was granted responsibility for road-based public transport by the Community of Madrid, which currently relates to 289 intercity bus routes between Madrid City and the rest of Madrid s territory. These routes are operated by 33 private companies, under 44 administrative concessions. With a fleet of 1,408 buses, these bus operators carry over 845,000 passengers daily, corresponding to an annual demand of 234 million trips. There are also 79 additional municipal routes which operate in metropolitan municipalities, carrying 43 million passengers per year. In 1983, when the Autonomous Community of Madrid was created, the State Government distributed the shares of the Metro de Madrid, S.A. (the metro services operator) between the Town Hall of Madrid, 75%, and the Community of Madrid, 25%. Both institutions ceded their equity rights to the management board of the Consortium CRTM. In 2002, annual demand for the Metro network was million trips. Empresa Municipal de Transportes de Madrid (EMT) is entirely owned by the Town Hall of Madrid. It operates 1,900 buses on 188 different routes within the municipality of Madrid. They carry 1,700,000 passengers daily, which translates into million trips per year. Another operator in the Community of Madrid is Cercanías-RENFE, an intercity railway network subordinate to the central State Administration. In the past 15 years Cercanías has increased its demand by 240%, currently reaching million trips per year. FInally, other less significant operators include Transportes Ferroviarios de Madrid (TFM), concessionaire of the Metro line 9 extension, Empresa Municipal de Transportes de Fuenlabrada and the municipal bus services of Parla. Source: Adapted from Cristóbal-Pinto, 2007b The second pillar of CRTM is fare integration, which contributes to creating a coherent and appealing image of the public transport system. With the creation of the Transport Pass, an integrated ticket for all public transport systems within a spatial zone, existing fares of the different operators were aligned and the range of different transport tickets was simplified. Finally, the CRTM is supported by modal integration, which has increased notably thanks to the creation of large interchanges in the city with the aim of allowing users to transfer comfortably between modes. Public transport in Madrid is highly subsidised (as it is in the majority of European cities 11 ), the public-sector financing percentage being around 55.5% 12. Neither tariffs not alternative sources of financing (publicity, traffic taxes, income from taxi licenses, etc.) guarantee the full coverage of operating costs, thus making public subsidy necessary. 1.2 STRUCTURAL FEATURES AND SERVICE DELIVERED The Madrid Metro network is currently the second largest metro network in Western Europe, after London. In March 2011, the total length was 291 km with 289 stations and thirteen lines (see Figure 1.3). Three of them (L7, L9, L10) run partly outside the municipality and one runs entirely through other municipalities (L12 MetroSur). With regard to technical features, as 11 For further information see Isfort (2009). 12 This percentage does not consider railway services operated by Renfe because it has signed a Contract-Programme with the State, by which the State covers the investment and operating costs of metropolitan services (Cercanías). 11

18 described by Schwandl 13, Madrid Metro has been built with UIC (International Union of Railways) gauge of 1,445 mm, all lines have overhead power supply, either by conventional tram type catenary or rigid overhead power rail and the trains ride on the left. Line 8 of the Madrid Metro is a radial line of the network, which runs between the centre and the northeast of the city linking the core business centre of Madrid and Barajas International Airport. Its stations have 110 m long platforms. This has enabled an increase in the number of carriages per train from an initial three to four. The thirteen trains that run on Line 8 belong to the 8000 series, high-performance units with air conditioning, TV sets, passenger information system, etc. They are equipped with train protection systems 14, which allow the interval between trains to be reduced while ensuring maximum safety. 13 In UrbanRail.Net (2011). 14 ATP (Automatic Train Protection) and ATO (Automatic Train Operation). 12

19 Figure 1.3 THE MADRID METRO NETWORK Source: Adapted from 13

20 Currently, the Line has 8 stations (see Figure 1.4): Nuevos Ministerios, Colombia, Pinar del Rey, Mar de Cristal, Campo de las Naciones, Aeropuerto T1-T2-T3, Barajas and Aeropuerto T4. Figure 1.4 SCHEME OF LINE 8 STATIONS Source: Authors Some of these act as interchanges with other Lines (Table 1.2): Colombia, which connects line 9; Mar de Cristal, where Lines 4 and 8 join; and Nuevos Ministerios, one of Madrid s largest interchanges in which Lines 6, 10, 8 and Cercancías (suburban services) interchange. Pinar del Rey and Barajas fulfil a role in improving accessibility and connectivity for inhabitants of Hortaleza and Barajas, which were two of the districts with the poorest public transport coverage previously 15. Finally, Campo de las Naciones and Aeropuerto stations serve two main infrastructures of the city: the former serves the fair enclosures (Madrid International Fair IFEMA and the Congress Palace) and the latter the two terminal buildings of Spain s biggest airport. Table 1.2 LINE 8 S CONNECTION WITH OTHER METRO LINES, BUS AND CERCANÍAS Interchange to metro network Station Connection with other public modes 6 10 Nuevos Ministerios Cercanías Renfe 9 Colombia Pinar del Rey 4 Mar de Cristal Campo de las Naciones Aeropuerto T1, T2 and T3 Interurban buses Barajas Interurban buses Aeropuerto T4 Source: Metro de Madrid (2012) 1.3 TARGET POPULATION The target population of the project is, firstly, citizens living in the areas served by the line; secondly, people working at the airport, flying from or to Madrid-Barajas as well as people 15 See Cristóbal-Pinto (2001). 14

21 accompanying air passengers departing from or arriving at Barajas airport; finally, people working or visiting IFEMA, Madrid s Trade Fair, one of the world s major exhibition complexes. The airport is an important economic centre for the Madrid Region, not only owing to its activity but also to its role as an employment generator. In 2001, the airport accounted for 27,168 direct, 25,678 indirect and 102,543 induced jobs, 155,389 in total (Cristóbal-Pinto et al., 2001). This amount represented 8.9% of total employment in CM, contributing EUR 10,138 million to the regional economy (13% of Gross Domestic Product - GDP). Regarding air passengers, Figure 1.5 shows that traffic in Barajas airport, which holds a leading position in the Spanish air market, more than trebled in the period In the last 4 years, the economic crisis has stopped the strong growth observed until Figure 1.5 BARAJAS AIRPORT PASSENGERS* EVOLUTION ,000,000 50,000,000 40,000,000 30,000,000 20,000,000 10,000, * Both transit and terminal Source: Authors elaboration of data provided by AENA (2011) 16 AENA has given a provisional figure of 49,662,512 passengers for

22 Figure 1.6 SPAIN S BUSIEST AIRPORTS BY TOTAL PASSENGER TRAFFIC 2010 Source: AENA (2010) Besides serving the airport, Line 8 was designed to provide a public transport alternative for flows between the centre and municipalities located near the airport, notably Hortaleza and Barajas, which had been continuously increasing and were creating heavy congestion on the accesses to Madrid. Another key trip generator for the line is the Madrid Fair complex. In 2010, IFEMA had an impact on the Region's economy estimated at around EUR 2,000 million for the year and accounted for 40,000 direct and indirect jobs, according to figures provided by the European Major Exhibition Centres Association. IFEMA organised, in 2010, 81 events, with a total of 2,607,342 visitors and 434 workers, making it the 4 th largest international trade fair in the EU 17. The high quality, rapid connections with downtown Madrid have undoubtedly had a positive effect on the success of IFEMA. 1.4 CURRENT PERFORMANCE Line 8 offers a quick, comfortable, regular and reliable public transport connection for residents and employees located near its stations in central Madrid and in Barajas village. It is also an essential service for employees of and visitors to two major generators of mobility, the airport and the international fair. To evaluate the project it is, however, necessary to analyse its performance and to compare it with the options of either using other public transport or private vehicles, that represent reasonable alternatives for metro users. 17 Behind Messe Frankfurt, Messe Düsseldorf and Deutsche Messe Hannover. 16

23 1.4.1 METRO LINE 8 Metro Line 8 from Nuevos Ministerios to T4 Airport terminal, completed in 2007, is capable of carrying some 13,000 passengers per hour. During peak hours, thirteen trains - with four coaches each - service the line at an operational speed of 39.5 km/h. The travel time from one end to the other is about 24 minutes. Presently, it offers service from 06:00 in the morning to 02:00 at night. Table 1.3 sets out the average interval between trains, which is about five minutes for daytime services, and about 15 minutes for night services (from 00:00 to 02:00). This high frequency of services, together with the high level of connectivity and the growth in airport passenger numbers, explains why demand has grown consistently since its commissioning. Table 1.3 AVERAGE INTERVAL BETWEEN TRAINS ON LINE 8 Line 8 Working days Saturdays Sundays and Holidays 6:05 to 7: :00 to 7: :30 to 9:30 9:30 to 14: :00 to 15: :30 to 18: :00 to 19: :30 to 20: :30 to 21: :30 to 22: :00 to 00: :00 to Source: Metro de Madrid (2012) The contribution of the airport to Line 8 demand is presented in Table 1.4. As can be seen, passengers joining the metro system at the station located in T1, T2 and T3 terminals represent approximately 10% of all passengers using Line 8. A similar number may be considered as leaving the system through the same station. It could thus be argued that some 8 million airport-related trips were made on the line before the T-4 station was operational and the total is presently some 12 million, about a third of all trips made on the line. In total, about one third of the total number of Line 8 passengers use one of the stations located in the Barajas airport terminals. 17

24 Table 1.4 Year PASSENGERS ACCESSING METRO LINE 8 AT AIRPORT STATIONS Airport T1, T2 and T3 (pax.) Airport T1, T2 and T3 (%) Airport T4 (pax.) Airport T4 (%) TOTAL Line 8 (pax.) ,372, ,728 6 % ,006, ,988, % ,746, ,075, % ,163, ,794, % ,631, ,506, % ,527, ,822, % ,804, ,386, % ,236, ,125, % ,458, ,142, % 1,617,707 5 % 35,008, ,414, % 2,395,129 7 % 34,549, ,589, % 2,427,986 7 % 34,808, ,878, % 2,378,252 7 % 34,933,374 Source: CRTM (2011b) Being in an area with an integrated fare system (see Box 1.2), the same ticket is valid for all the lines of Metro de Madrid (Zone A). However, starting from 2007 passengers travelling to/from the Airport must pay a special additional fare, except those passengers using Transport Season Tickets (Zone A), Tourist Season Tickets or with AENA cards given to airport employees. In addition to the base fare of EUR 1.50, airport users had to pay an extra charge of EUR 1.00; this has been recently increased to EUR 3.00, thus making EUR 4.50 the total fare paid by metro users travelling between the city and the airport (see Table 1.5). Table 1.5 TARIFF SYSTEM IN PLACE FOR LINE 8 Fare for non-airport users Extra-charge for airport users Total fare for airport users From Source: 18

25 Box 1.2 MADRID S INTEGRATED FARE SYSTEM After the creation of the Consortium CRTM, in June 1985, the creation of a common fare framework was envisaged and, in 1987, the Transport Season Pass was created. To achieve this, the Madrid Community was divided into different concentric zones, each of them covering a larger area than the previous zone, according to the following classification: Zone A, coinciding with Madrid municipality; Three rings: B1, B2, B3, which cover Madrid s metropolitan area; Zones C1 and C2 for the rest of the Community of Madrid; Zones E1 and E2 in Castilla La Mancha (a neighbouring autonomous community). The price of the Transport Season Ticket varies according to the area of the zone covered and is valid for any transport operator coordinated by CRTM (Metro network, EMT 18, Cercanías-RENFE, MetroLigero network, Parla tram lines and urban and intercity buses in the Community of Madrid), without any restrictions on either the number of trips or days of the week. Figure: Price zones of the Transport Pass (left) and Distribution mode of transport of the Transport Pass ticketing (right) Source: Promoteo (2007) and authors processing CRTM (2010) The Transport Season Ticket consists of three types of monthly pass: normal pass, young pass (ages under 23) and senior pass (ages over 65); an annual ticket is also provided for normal pass and senior pass. Other tickets for public transport in Madrid are, in general, only valid for one operator, and consist of a single ticket or a ten-trip ticket. In the case of the Metro, it is also possible to buy a combined ticket (single or ten-trip) which allows the user to travel on the entire metro network (which includes Metro de Madrid, MetroLigero, MetroSur, MetroNorte, MetroOeste, TFM and airport terminals). Source: Authors processing Metro de Madrid (2012c) and Iturbe, J.I. (2000) From a financial sustainability perspective, the tariff revenues generated by the project are not enough to cover its operating and maintenance costs. Actually, it is the high degree of public subsidisation of the sector that allow to cover all costs, as explained in Section Except on the Airport Express Line. 19

26 1.4.2 BUS Currently there are three different bus lines linking Madrid with the airport: Line 200, Line 203 and Line N27. As can be seen in Table 1.6, the last two are Express lines, while the first is a standard Line. Table 1.6 CURRENT BUS PERFORMANCE TO THE AIRPORT (OCTOBER 2011) Bus line Type of bus Line Bus stops Demand Pax/working day 200 Ordinary City centre: Av. América (2), Canillejas Airport: T1, T2, T4 3, Express Line City centre: Atocha-Renfe, Plaza de Cibles, O Donnell Airport: T1, T2, T4 N27 Night Express City centre: Atocha-Renfe, Plaza de Cibles, O Donnell Airport: T1, T2, T4 Source: CRTM (2011) With regard to frequencies, there is approximately one bus every 15 minutes on both day-time lines (lines 200 and 203), whilst for line N27 (night service) the frequency decreases to one bus every 35 minutes. These bus lines serve passengers located close to important places in Madrid, such as Plaza de Cibeles or Av. América, and cover different areas to those covered by Line 8. The express lines connect the Southern part of the city centre with the airport in 40 minutes (Metro Line 8 covers the Northern part). As shown in Table 1.5, lines 200 and 203 carry 3,500 and 3,300 passengers and the night express line, 417 passengers respectively per working day. The environs of the airport are served by two other standard lines (lines 112 and 114). Their last stop is Barrio del Aeropuerto. Line 114 starts its route in Avenida América and has 19 stops. Line 112 route, with 14 stops, connects Mar de Cristal with Barrio del Aeropuerto. 3, CERCANÍAS Cercanías-RENFE is a suburban rail service operated by Renfe (the railway Spanish operator) that connects a number of large cities in Spain with their metropolitan areas and major populations of the community. These services are operated on infrastructure managed by ADIF (the Spanish rail infrastructure manager). In Madrid, there are ten Cercanías-RENFE lines (Figure 1.7), which run at lower frequencies than the Metro services: the average interval between trains is 15 to 30 minutes (on working days), depending on the line and the time of the day. Being part of the CRTM, Cercanías uses the same fare system, based on concentric rings around Madrid City. 20

27 Figure 1.7 CERCANÍAS-RENFE MADRID NETWORK Source: RENFE (2012b) The Cercanías service to the airport was opened to traffic on 23 rd of September, This line connects Madrid with the airport in 38 minutes and there is a train every 30 minutes. Even though C-1 line only allows a direct connection with the new terminal T4 (see Figure 1.8), the ticket includes a free direct bus connection from T4 to T1, T2 and T3. Figure 1.8 STATIONS OF CERCANÍAS C-1 LINE Source: Renfe (2012) Line C-1 runs from 06:00 to 00:00 every day and allows interchange with metro lines 1, 5, 6, 8, 10 and with most of the other Cercanías lines. Demand on line C-1 the week after its inauguration was, on average, 3,200 passengers per day ROAD There are three main routes to the airport from Madrid by road: using the M-40 ring road, the A-2 motorway (which connects Madrid with Barcelona) or the N-100. Congestion on the roads 21

28 of Madrid and its surroundings had been a growing problem in spite of important investments in road infrastructure. This was particularly acute in the North-eastern axis, which channels traffic to Barcelona, to the industrial areas of Valle del Henares and to the airport. Even with the construction of Line 8 and the subsequent modal shift from road to railways, and a new motorway serving the T-4 terminal, congestion is still a problem on the Madrid city centre Barajas Airport corridor. As can be seen in Figure 1.9, which shows the results of a study carried out by RACC (2009), the connection to the airport (the airport location is circled in red), which coincides with the intersection between the A2 and M-40, is still one of the most congested points in the area; indeed, average speed on these roads of less than 50 km/h 19, with systemic jams during peak hours. Figure 1.9 CRITICAL CONGESTED POINTS ON MADRID S ROADS Source: RACC (2009) 19 An analysis of traffic speed evolution over the day on the different roads of Madrid is presented in RACC (2009). 22

29 2 ORIGIN AND HISTORY 2.1 CONTEXT FOR THE PROJECT In 1996, the population of the Community of Madrid totalled 5,022,289 inhabitants, that is, 12.6% of the Spanish population. Within the community, Madrid city held 57% of the population, another 34% resided in the metropolitan area and the remaining 9% in nonmetropolitan municipalities. Madrid was also one of the most important economic centres in Spain, which accounted for 10% and 20% of Spain s exports and imports respectively. In addition, tourism was a significant component in the region s GDP (6% in 1998). Activity related to Madrid s capital, business centre and tourism roles has heavily relied on its airport. Since the Sixties, passenger numbers at Madrid Barajas have grown steadily. This, together with its central location in the Iberian Peninsula, explains why AENA, the manager of all Spanish airports, stated its intention of making of Barajas the Peninsula s international hub (Figure 2.1) in the Airports Master Plan of Figure 2.1 MADRID BARAJAS CONNECTIONS (1999) Source: AENA (1999) The area of influence of Madrid-Barajas can be extended to South America, throughout Europe and, to a lesser extent, the rest of the world, as a result of its consideration as a hub airport, capable of connecting the European Union and South America and channelling many types of routes. Source: AENA (1999) Despite being one of the Europe s busiest airports, in 1998 Madrid-Barajas airport was not efficiently connected to the city. Indeed, public transport services to the airport consisted of a single bus line run by the municipal bus operator EMT (Entidad Metropolitana del Transporte). This bus line was not included in the public transport network and connected the airport with the city centre (Plaza de Colón); fares on the line were unrelated to those applied elsewhere by EMT. In spite of being the only public transport means accessing the airport, the percentage of bus users had a lower modal share than in other European airports. As Table 2.1 sets out, most of the passengers (55.2%) travelled to the airport by taxi and 31.5% by private vehicle, making Barajas the European airport with the highest share of people accessing it by car (86.7%). 23

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