International Journal of Civil Engineering and Technology (IJCIET), ISSN 0976 – 6308 (Print),
ISSN 0976 – 6316(Online), Vo...
International Journal of Civil Engineering and Technology (IJCIET), ISSN 0976 – 6308 (Print),
ISSN 0976 – 6316(Online), Vo...
International Journal of Civil Engineering and Technology (IJCIET), ISSN 0976 – 6308 (Print),
ISSN 0976 – 6316(Online), Vo...
International Journal of Civil Engineering and Technology (IJCIET), ISSN 0976 – 6308 (Print),
ISSN 0976 – 6316(Online), Vo...
International Journal of Civil Engineering and Technology (IJCIET), ISSN 0976 – 6308 (Print),
ISSN 0976 – 6316(Online), Vo...
International Journal of Civil Engineering and Technology (IJCIET), ISSN 0976 – 6308 (Print),
ISSN 0976 – 6316(Online), Vo...
International Journal of Civil Engineering and Technology (IJCIET), ISSN 0976 – 6308 (Print),
ISSN 0976 – 6316(Online), Vo...
International Journal of Civil Engineering and Technology (IJCIET), ISSN 0976 – 6308 (Print),
ISSN 0976 – 6316(Online), Vo...
International Journal of Civil Engineering and Technology (IJCIET), ISSN 0976 – 6308 (Print),
ISSN 0976 – 6316(Online), Vo...
International Journal of Civil Engineering and Technology (IJCIET), ISSN 0976 – 6308 (Print),
ISSN 0976 – 6316(Online), Vo...
International Journal of Civil Engineering and Technology (IJCIET), ISSN 0976 – 6308 (Print),
ISSN 0976 – 6316(Online), Vo...
International Journal of Civil Engineering and Technology (IJCIET), ISSN 0976 – 6308 (Print),
ISSN 0976 – 6316(Online), Vo...
International Journal of Civil Engineering and Technology (IJCIET), ISSN 0976 – 6308 (Print),
ISSN 0976 – 6316(Online), Vo...
International Journal of Civil Engineering and Technology (IJCIET), ISSN 0976 – 6308 (Print),
ISSN 0976 – 6316(Online), Vo...
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  1. 1. International Journal of Civil Engineering and Technology (IJCIET), ISSN 0976 – 6308 (Print), ISSN 0976 – 6316(Online), Volume 5, Issue 5, May (2014), pp. 27-40 © IAEME 27 A FEASIBILITY STUDY FOR A SUSTAINABLE PUBLIC TRANSIT NETWORK LINKING TRIPOLI TO BEIRUT CITIES IN LEBANON Nabil Semaan1 1 Assistant Professor, Civil Engineering Department, Faculty of Engineering, University of Balamand, Kelhat, El-Koura, Lebanon ABSTRACT Due to the increasing population and number of cars for a small and limited space country, Lebanon is facing a major traffic congestion problem. The Lebanese ministry of interior affairs has reported that 1.8 million cars exist in Lebanon, whereas its total population is around 4 million. The Lebanese ministry of environment reported in its 2nd national communication in 2011 to the United Nations framework convention on climate change (UNFCCC) that the transportation sector contributed in the year 2000 alone to 29% of the total carbon dioxide (CO2) energy related emissions and 22% of the total green house gas (GHG) emissions. Furthermore, the economic and social commission for western Asia (ESCWA) report, published in 2011, recommends measures and policies to be adopted in Western Asia to tend towards a sustainable transportation systems. On the other hand, the Lebanese government is unable to face this major problem and to find a sustainable solution for its air environment quality. This research proposes public transportation as a sustainable solution. The main objective of this research is to perform an economic feasibility study using ‘life cycle cost analysis’ (LCCA) method for a railway network linking Tripoli to Beirut cities. Two alternatives are proposed: alternative 1: an underground subway network; and alternative 2 an aboveground railway network. The LCCA applies the ‘benefit-to-cost’ (B/C) ratio for governmental projects in order to evaluate the two alternatives. The economic evaluation advises that both alternatives are feasible; however alternative 2 is preferred and more profitable. A sensitivity analysis is also performed in order to evaluate the effect of uncertainties of benefits, costs and discount rate on the decision. It is observed that a big decrease in the benefits significantly change the B/C ratio of alternative 1, while the alternative 2 remains feasible. Keywords: Life Cycle Cost Analysis, Benefit-to-Cost Ratio, Sustainable Project, Public Transportation, Railway Network. INTERNATIONAL JOURNAL OF CIVIL ENGINEERING AND TECHNOLOGY (IJCIET) ISSN 0976 – 6308 (Print) ISSN 0976 – 6316(Online) Volume 5, Issue 5, May (2014), pp. 27-40 © IAEME: www.iaeme.com/ijciet.asp Journal Impact Factor (2014): 7.9290 (Calculated by GISI) www.jifactor.com IJCIET ©IAEME
  2. 2. International Journal of Civil Engineering and Technology (IJCIET), ISSN 0976 – 6308 (Print), ISSN 0976 – 6316(Online), Volume 5, Issue 5, May (2014), pp. 27-40 © IAEME 28 1. INTRODUCTION Due to the increasing population and number of cars for a small and limited space country, Lebanon is facing a major traffic congestion problem. The Lebanese ministry of interior affairs has reported that there exist between 1.4 and 1.8 million cars in Lebanon, whereas its total population is around 4 million. The Lebanese ministry of environment (MOE, 2011) reported in its 2nd national communication, in 2011, to the United Nations framework convention on climate change (UNFCCC) that the transportation sector contributed in the year 2000 alone to 29% of the total carbon dioxide (CO2) energy related emissions and 22% of the total green house gas (GHG) emissions. Furthermore, the economic and social commission for western Asia (ESCWA) report published in 2011 recommends measures and policies to be adopted in western Asia to tend towards sustainable transportation systems. In addition to the 1.4 million cars in Lebanon, 50,000 vehicles are imported every year. 90% of the total cars are privately owned, resulting in an ownership rate of 1 car per 3 persons, one of the highest worldwide (even among developed countries). It is also reported that 70% of the private cars are older than 10 years, whereas 20% of the cars are older than 20 years (Chaaban, 2004). This excessive use of cars results in a wide range of problems, mainly environmental, and socio- economic. The major environmental problems are the following: • Cars cause serious local air pollution problems, such as toxic emissions (nitrogen oxides, sulfur oxides, volatile organic compounds, etc…) that affect greatly human health and environment. Nitrogen dioxide (NO2) levels averaged to 53 µg/m3 in 2011, while the world health organization (WHO) limit is set for 40 µg/m3 (Chaaban, 2004). • Cars contribute also to the acid rain phenomenon and the global warming. For instance, 5.64 million tons of CO2 emissions are reported in 2000, compared to 2.85 tons in 1990, i.e. double in ten years (Chaaban, 2004). • The dense traffic, old engines, and excessive honking produce high noise pollution. The average noise level exceeds 75 dB, while the standard level for developed countries is 72 dB (Green line). Now, the major socio-economic problems are the following: • High traffic jams will cause increased frustration and aggressive behavior. • High traffic jams mean lot of time lost on the road, which decreases efficiency and productivity. • Excessive cars combined with weak traffic management increases accident risk. Road accidents cause nearly one death per day and over 3000 injuries per year in Lebanon. • The highest expenditure for the government goes to the maintenance and rehabilitation of roads and highways, estimated to be around 26 million dollars for the year 2000. • The transport sector consumes around 45% of the total petroleum products that are imported (Green line). • There are around 38000 taxis in Lebanon, whereas the need for public transport does not exceed 18000 (Green line). Hence, Lebanon is paying billions of dollars yearly due to the traffic, accidents, pollution, and road maintenance. A sustainable public transport policy is urgently needed. A railway network from Beirut to Tripoli is a crucial sustainable solution. Both Beirut and Tripoli are the two major residential concentration in Lebanon. They both comprise the major public and private firms’ locations.
  3. 3. International Journal of Civil Engineering and Technology (IJCIET), ISSN 0976 – 6308 (Print), ISSN 0976 – 6316(Online), Volume 5, Issue 5, May (2014), pp. 27-40 © IAEME 29 Studies have shown that the two most suitable alternatives for constructing this public transportation network are: 1) Underground metro line below the old tracks location, with metro trains, stations, and additional stops (Alternative 1); 2) Aboveground railway line along the old track locations, with new trains, tracks, stations, and additional stops (Alternative 2). The papers’ main objective is to perform an economic feasibility study for the above two alternatives. The sub-objectives are: i. Confirming the railway lines for the new alternatives, ii. Locating the additional stops for the two alternatives, iii. Evaluating the cost and savings for the two alternatives, iv. Evaluating the benefits and disbenefits for the two alternatives, v. Using Benefit to Cost Ratio in order to evaluate the economic feasibility of the two alternatives, vi. And performing sensitivity analysis on the favorable alternative. 2. BACKGROUND 2.1 Old Railway Location In 1891, the French made a concession to build the Beirut-Damascus Railway, which was awarded to the Société des Chemins de Fer Ottomans Economiques de Beyrouth-Damas-Hauran. Four years later, in August 1895, the Beirut-Damascus railway was inaugurated having a 1.05 meters narrow gauge tracks. Throughout the years other railways and tramways were constructed, some of which include the Riyaq-Aleppo, Riyaq-Baalbak, Baalbak-Aleppo, Homs-Tripoli, in addition to the Haifa-Beirut for military traffic solely. On December 18, 1942, the Beirut-Tripoli railway was completed with an average of 85 kilometers road distance, and standard gauge tracks, mainly for freight. This route had five railway stations, located in: i) Tripoli (near the port), ii) Chekka (next to the cement factory), iii) Jouniyah, iv) next to Beirut port (Mar Mkhayel Station), and v) Sin El Fil station. 2.2 Old Railway Current Condition According to the Société Trans-Arab d’Entreprise et de Gestion (SOTEG) – an investment company asked by the Lebanese government to evaluate the existing condition of the old Beirut- Tripoli railway -the tracks of the old Tripoli-Beirut railway have been removed in most places, and what is left cannot be salvaged. Very few coal-operated locomotives that cannot be renovated or used, wagons, and carts still remain at the existing stations. However, SOTEG proposed that they can be used for museums or as historical monuments. On the other hand, the existing stations’ condition is extremely poor – except for Tripoli station – and must be completely reconstructed (Matta, 2013). 2.3 Cost of Rehabilitation According to SOTEG study, the cost of rehabilitation of the old railway network is estimated to be 205 million US dollars approximately. These costs consist of the supply and installation of tracks, wagons, and construction of stations. Even though rehabilitation is needed, the old railway must be redesigned for public transport and not for freight as it was before (Matta, 2013).In addition to the above, rehabilitating the old railway is not feasible, not profitable, and surely will not meet environmental-friendly public transportation purposes.
  4. 4. International Journal of Civil Engineering and Technology (IJCIET), ISSN 0976 – 6308 (Print), ISSN 0976 – 6316(Online), Volume 5, Issue 5, May (2014), pp. 27-40 © IAEME 30 3. PROPOSED SUSTAINABLE ALTERNATIVES New alternatives of railways connecting Tripoli to Beirut cities must be proposed and developed. However, these alternatives should meet the sustainability criteria. Sustainable development is the plan of improving the standard of living by protecting human health, conserving the environment, using resources efficiently, and advancing long-term competiveness. Thus, any sustainable alternative must integrate the environmental, social and economic criteria; i.e. should be environmental-friendly, socially beneficial, and economically feasible. 3.1 Sustainable Alternatives 3.1.1 Alternative 1: Underground Subway Line The first alternative (Alternative 1) consists of proposing an underground subway railway passing exactly underneath the old railway tracks. The main advantage of this alternative is the use of land owned by the Lebanese government (under the old railways) without the need of purchasing new land for the railway tracks. In addition, an underground subway leaves more space on the ground level for other usage. This alternative requires that new subway electric trains be purchased, and new stations and parking lots be constructed. 3.1.2 Alternative 2: Aboveground Railway Line The second alternative consists of rehabilitating the old railway, rebuilding a new railway track along the same old one, and constructing new stations and parking lots. It is also needed to purchase new equipment, and electric trains. 3.1.2 Sustainability Criteria for both Alternatives Both alternatives meet the sustainability criteria, as follows: i) They are environmentally beneficial, since they both use electric trains, hence produce no air pollution. In addition, they reduce car usage, thus decreasing significantly noise pollution. ii) They are socially beneficial, since they both reduce car usage, thus minimizing risks of accidents, users stress and transportation time. iii) Finally, both alternatives must show economic benefit. This research project uses Life Cycle Cost Analysis with the Benefit-to-Cost ratio in order to evaluate the economic feasibility of the two alternatives. However, in order to complete the analysis of the proposed alternatives, this research investigates the types and number of trains to be used, in addition to the new stations to be added. 3.2 Stations and Trains Analysis 3.2.1 Stations Analysis For both alternatives, additional stations – and train stops – are added. The selection of the stations is delicate, critical, and crucial to the decision. Additional stations were selected near the big cities between Tripoli and Beirut on one hand, and at the connection between mountainous districts and the seacoast on the other. Refer to Matta (2013) for a detailed analysis on the choice of the stations. Nine stations are proposed: (1) Tripoli, (2) Al Qalamoun, (3) Chekka, (4) Batroun, (5) Byblos, (6) Ghazir, (7) Jouniyah, (8) Dbaiyeh, and (9) DowntownBeirut. Fig. 1 shows the Tripoli- Beirut aerial map, with the new stations location, and the proposed railway/subway network.
  5. 5. International Journal of Civil Engineering and Technology (IJCIET), ISSN 0976 – 6308 (Print), ISSN 0976 – 6316(Online), Volume 5, Issue 5, May (2014), pp. 27-40 © IAEME 31 Figure 1: Tripoli-Beirut Aerial Map with New Railway Stations 3.2.2 Train Analysis An extensive research work on model types of trains was performed by Matta (2013). This paper space does not allow presenting the research methodology. Refer to Matta (2013) for the complete analysis of the train types. The outcome of this research is the proposal to use two types of trains: (1) British Rail Class 357, and (2) Kintetsu 22600 Series (Ace).They both meet the alternatives’ sustainable requirements. Both are very close in their initial (purchase and shipment) costs, and the operation and maintenance costs. For this economic feasibility study an average train initial and operation and maintenance costs are used. Now, the number of trains for both alternatives is determined based on the following assumptions: i) there is a distance of 85 km from Tripoli to Beirut, ii) it is assumed that the train will move at an average speed of 130 km/hr., iii) it is assumed that the train needs an average of 5 New Railway/Subway Network New Stations
  6. 6. International Journal of Civil Engineering and Technology (IJCIET), ISSN 0976 – 6308 (Print), ISSN 0976 – 6316(Online), Volume 5, Issue 5, May (2014), pp. 27-40 © IAEME 32 minutes per stop, iv) it is assumed that the rush timeis from 6:00am.to 9:00am., and from 4:00pm. to 6:00pm., v) it is assumed that a train is scheduled to leave every hour during regular time, and vi) it is assumed that a train is scheduled to leave every half an hour during rush time. Based on these assumptions, a discrete graphical simulation model is developed that is used to calculate the optimum required number of trains. The graphical illustration of the simulation model is shown in Fig.2. According to Fig.2, six trains are needed for both alternatives. Figure 2: Graphical Simulation Model for Train Schedule 4. LIFE CYCLE COST ANALYSIS METHODOLOGY Life cycle cost analysis (LCCA) is an economic decision making method of project evaluation in which all costs are considered over the whole life of the project. These costs consist of the investment cost, construction cost, maintenance and operation costs, rehabilitation costs, generated income, and salvage value. In calculating the life cycle cost of a project, all future costs are discounted to their present value (PV) equivalent using the investor’s minimum attractive rate of return (MARR) as the discount rate. Benefit-to-Cost (B/C) ratio is an economic tool that is used in LCCA in order to measure the worth of public (governmental) projects. The B/C ratio method evaluates the ratio of benefits and disbenefits equivalent cash on one hand to the costs and savings equivalent cash on the other. Of course, the difficulty of this method lies in the process of evaluating an equivalent cash for social, and/or environmental benefits, disbenefits or costs and savings. The key steps in LCCA with B/C ratio is as follows: 1. Define the alternatives, 2. Establish the assumptions and parameters, such as the life of the alternatives and the discount rate. 3. Define, then estimate the benefits, disbenefits, costs and savings for each alternative,
  7. 7. International Journal of Civil Engineering and Technology (IJCIET), ISSN 0976 – 6308 (Print), ISSN 0976 – 6316(Online), Volume 5, Issue 5, May (2014), pp. 27-40 © IAEME 33 4. Compute the equivalent present value (PV) of the benefits (minus disbenefits) to costs (minus savings) for each alternative as per equation (1): SC DBB PV-PV PV-PV / =CB (1) Where:PVB = Present value of benefits, PVDB = Present value of disbenefits, PVC = Present value of costs, PVS = Present value of savings. Then, check the feasibility of each alternative as per equation (2): If B/C ≥ 1, Alternative is economically feasible (2) 5. Compute the incremental B/C ratio of the alternatives as per equation (3): S-C DBB Alt2-Alt1 PVPV PV-PV / ∆∆ ∆∆ =∆ CB (3) Where:∆B/CAlt1-Alt2 =difference of benefits minus disbenefits divided by The difference of cost minus savings of alternatives 1 and 2 respectively. Then advise on the best alternative, as per equation (4): If ∆B/CAlt1-Alt2≥ 1 choose alternative 1 and drop alternative 2 If ∆B/C Alt1-Alt2< 1 choose alternative 1 and drop alternative 2 (4) 6. Perform sensitivity analysis. 5. PROPOSED ALTERNATIVES’ LCCA AND B/C RATIO ANALYSIS Following the methodology (key steps) described in the previous section, LCCA with B/C ratio is applied to the sustainable alternatives. 5.1 Definitions of Alternatives The alternatives are already defined and described in the previous sections. Alternative 1 is defined as the underground subway network, while Alternative 2 is the aboveground railway network. 5.2 Alternatives Life and Discount Rate The costs and benefits of an alternative are to be evaluated over a timeframe equivalent to the economic (useful) life of the associated facilities/ assets affected by the decision. Literature suggests an analysis period of 20 to 25 years as a typical range for transportation project. The project life should be long enough to capture most of the useful life of a project but not so long as to go beyond the period of time where reasonable estimates are hard to accomplish. The project life for this feasibility study will be 25 years. When a public project is evaluated, an appropriate discount rate or minimum attractive rate of return(MARR) should be selected. Two general concepts are perceived: i) the discount rate should reflect only the general government borrowing rate, or ii) the discount rate should represent the rate that could have been earned had the funds not been removed from the private sector. No matter the
  8. 8. International Journal of Civil Engineering and Technology (IJCIET), ISSN 0976 – 6308 (Print), ISSN 0976 – 6316(Online), Volume 5, Issue 5, May (2014), pp. 27-40 © IAEME 34 approach, deciding on the discount rate for a public project remains subjective. This research has chosen an MARR of 6%, based on the input of several experienced investors. 5.3 Benefits and Disbenefits Evaluation Benefits and disbenefits are estimated for both alternatives. Table 1 and Table 2 show the benefits and disbenefits evaluation of alternative 1 respectively. Refer to Matta (2013) for the detailed evaluation of the benefits and disbenefits for both alternatives. Table 1: Benefits Evaluation for Alternative 1 Type of Benefit Description Beneficiary Annual Benefits Cash (US Dollars) Economic Benefit Increased employment and business opportunities All society n/a. Equity Providing people who are economically, socially or physically deprived with the ability and ease to move about from North Lebanon to the Capital Users and Society n/a. Personal Benefits Increase in touristic and social activities Users n/a. Traffic benefits Resulting from reduced motor vehicle traffic All road users $ 56,832,000 Economic development Increased regional economic activity due to larger portion of local inputs in transit expenditures compared with automobile expenditure Regional Community $ 462,000 Safety benefits Relative safety and transit travel compared with automobile travel All society $ 36,920,000 Reduced roadway facility and service costs Reduced cost for road maintenance Government, environment, and society $ 8,500,000 Pollution reduction Reduced vehicle air and water pollution All society $ 3,584,780 Resource conservation Reduced use of energy and other natural reserves All society $ 160,885,430 Table 2: Disbenefits Evaluation for Alternative 1 Table 3 and Table 4 show the benefits and disbenefits evaluation of alternative 2 respectively. Type of Disbenefits Estimated Disbenefits Cash(U.S Dollars) Long construction period $ 166,387,520 Disturbing highway traffic during construction $ 118, 157, 230
  9. 9. International Journal of Civil Engineering and Technology (IJCIET), ISSN 0976 – 6308 (Print), ISSN 0976 – 6316(Online), Volume 5, Issue 5, May (2014), pp. 27-40 © IAEME 35 Table 3: Benefits Evaluation for Alternative 2 Type of Benefit Description Beneficiary Annual Benefits Cash (US Dollars) Economic Benefits Increased employment and business opportunities All society n/a. Equity Providing people who are economically, socially or physically deprived with the ability and ease to move about from North Lebanon to the Capital Users and Society n/a. Personal Benefits Increase in touristic and social activities Users n/a. Traffic benefits Resulting from reduced motor vehicle traffic All road users $ 56,832,000 Economic development Increased regional economic activity due to larger portion of local inputs in transit expenditures compared with automobile expenditure Regional Community $ 462,000 Safety benefits Relative safety and transit travel compared with automobile travel All society $ 36,920,000 Reduced roadway facility and service costs Reduced cost for road maintenance Government, environment, and society $ 8,500,000 Pollution reduction Reduced vehicle air and water pollution All society $ 3,584,780 Resource conservation Reduced use of energy and other natural reserves All society $ 160,885,430 Real Estate Benefit Since employees and students won’t need to move to the city, there will be a reduction in the inflation prices for apartments, dorms, and other real estate entities All society $ 150,000 Table 4: Disbenefits Evaluation for Alternative 2 5.4 Cost and Savings Evaluation The costs and savings for alternative 1 and alternative 2 are estimated and shown in Tables 5 and 6 respectively. Refer to Matta (2013) for the detailed evaluation of the costs and saving for both alternatives. Type of Disbenefits Estimated Disbenefits Cash(U.S Dollars) Displacement of Buildings $ 40,000 Displacement of Businesses $ 60,000 Disturbing local traffic during construction $ 13,128,580
  10. 10. International Journal of Civil Engineering and Technology (IJCIET), ISSN 0976 – 6308 (Print), ISSN 0976 – 6316(Online), Volume 5, Issue 5, May (2014), pp. 27-40 © IAEME 36 Table 5: Cost and Savings Evaluation for Alternative 1 Cost/Saving Description Cost (US Dollars) Initial Costs Construction Cost $ 824,700,000 Stations Land Cost Parking Land Cost $ 9,420,000 $ 44,500,000 Trains Cost $ 22,200,000 Annual Maintenance and Operation Costs Station Operation Cost Equipment Operation Cost Staff Cost $ 5,000,000 $ 30,000,000 $ 55,000,000 Facilities Maintenance Cost Equipment Maintenance Cost $ 10,000,000 $ 15,000,000 Rehabilitation Costs Rehabilitation Cost at year 10 Rehabilitation Cost at year 20 $ 15,000,000 $ 20,000,000 Savings Annual Revenue $ 37,887,970 Table 6: Cost and Savings Evaluation for Alternative 2 Cost/Saving Description Cost (US Dollars) Initial Costs Construction Cost $ 425,000,000 Stations Land Cost Parking Land Cost $ 9,420,000 $ 44,500,000 Trains Cost $ 22,200,000 Annual Maintenance and Operation Costs Station Operation Cost Equipment Operation Cost Staff Cost $ 5,000,000 $ 30,000,000 $ 28,700,000 Facilities Maintenance Cost Equipment Maintenance Cost $ 10,000,000 $ 15,000,000 Rehabilitation Costs Rehabilitation Cost at year 10 Rehabilitation Cost at year 20 $ 15,000,000 $ 20,000,000 Savings Annual Revenue $ 37,887,970
  11. 11. International Journal of Civil Engineering and Technology (IJCIET), ISSN 0976 – 6308 (Print), ISSN 0976 – 6316(Online), Volume 5, Issue 5, May (2014), pp. 27-40 © IAEME 37 5.5 Evaluation of B/C Ratio B/C ratio can now be evaluated for the two alternatives separately. The B/C of an alternative equals the PV of the benefits minus the PV of the disbenefits divided by the PV of the costs minus the PV of the savings, all of them discounted at 6%, for 25 years, as per equation (1). The alternative is feasible if its B/C is higher than unity, as per equation (2). Table 7 shows the B/C summary calculation for alternatives 1 and 2.Refer to Matta (2013) for the detailed cash flow evaluation for the B/C ratios. Table 7: B/C Evaluation Alternative PVB - PVDB(x103 ) PVC - PVS (x103 ) B/C 1 (underground subway) $ 3,103,014.54 $ 1,892,982.56 1.64 2 (aboveground railway) $ 3,404,199.37 $ 1,157,280.30 2.94 The B/C ratio for both alternatives is higher than unity, hence both are feasible. However, alternative 2 shows a B/C higher than alternative 1, i.e. more profitable. 5.6 Evaluation of the Incremental B/C Ratio Table 8 shows the calculation for the Incremental B/C ratio. Table 8: Evaluation of the Incremental B/C Ratio Alternative 1(x103 ) Alternative 2(x103 ) ∆PV2-1(x103 ) PVB-DB = $ 3,103,014.54 PVB-DB = $ 3,404,199.37 ∆PVB-DB = $ 301,184.83 PVC-S = $ 1,892,982.56 PVC-S = $ 1,157,280.30 ∆PVC-S = $ 735,702.26 B/C = 1.64 B/C = 2.94 ∆B/C1-2 = 0.49 Since the incremental ∆B/C ratio of alternative 2 minus that of alternative 1 is less than unity (< 1), then alternative 2 is better than alternative 1. Hence, it can be decided to go with alternative 2, i.e. the aboveground railway network. The preference of alternative 2 is mainly due to the big difference in the construction and operations cost. The construction cost of alternative 1 is almost double than that of alternative 2, mainly because an underground tunnel requires excavating the whole route from Tripoli to Beirut. The difference in the operation cost comes mainly from the difference of the staff costs, since alternative 1 requires almost double the staff than that of alternative 2. 5.7 Sensitivity Analysis Since all computed cash items are based on estimates and assumptions, additional sensitivity analysis must be performed in order to analyze the effect of the uncertainty in the cash evaluation to the decision. The four most important factors that affect the outcome of the B/C ratio are the discount rate or MARR, the construction cost, the operation and maintenance Cost, and the total benefit value. The purpose of this analysis is to observe if a change in any of these factors may cause alternative 2 to be unfavorable or alternative 1 to be favorable. Since the assumptions and estimates have a wide
  12. 12. International Journal of Civil Engineering and Technology (IJCIET), ISSN 0976 – 6308 (Print), ISSN 0976 – 6316(Online), Volume 5, Issue 5, May (2014), pp. 27-40 © IAEME 38 range of uncertainty, the change in the values will range from -40% to +40% of the originally estimated value. For every factor, the cash value is calculated along this range while keeping the other three factors constant, and then a new B/C ratio will be evaluated accordingly. Furthermore, the sensitivity analysis is performed for both alternatives. Sensitivity analysis was performed using @RISK software. A tornado graph is developed, describing the sensitivity of the B/C ratio to the change of values for the factor. Fig.3 shows a tornado graph of the sensitivity analysis for alternative 1. Figure 3: Sensitivity Analysis for Alternative 1 From Fig.3, it is observed that: • With MARR changing from -20% to +30%, the B/C ratio varies from 1.75 to 1.51. Therefore, as the MARR increases, alternative 1 becomes less feasible. • With the construction cost changing from -40% to +40%, the B/C ratio varies from 2.01 to 1.39. Therefore, as the construction cost increases, alternative 1 becomes less feasible. • With the yearly costs varying from -40% to +40%, the B/C ratio varies from 2.43 to 1.24. Therefore, as the yearly costs increase, alternative 1 becomes less feasible. • With the total benefits varying from -40% to +40%, the B/C ratio varies from 0.92 to 2.37. Therefore, as the benefits increase, Alternative 1 one becomes more feasible. It is only when the total annual benefits reach -40% of their base value (decrease) that the B/C ratio for alternative 1 becomes less than unity. Hence, it can be concluded that alternative 1 is feasible as long as its associated benefits are considerably high. The decision is sensitive to the benefits. Fig.4 shows a tornado graph of the sensitivity analysis for alternative 2.
  13. 13. International Journal of Civil Engineering and Technology (IJCIET), ISSN 0976 – 6308 (Print), ISSN 0976 – 6316(Online), Volume 5, Issue 5, May (2014), pp. 27-40 © IAEME 39 Figure 4: Sensitivity Analysis for Alternative 2 From Fig.4, it is observed that: • With MARR changing from -20% to +30%, the B/C ratio varies from 3.11 to 2.76. Therefore, as the MARR increases, alternative 2 becomes less feasible. • With the construction cost changing from -40% to +40%, the B/C ratio varies from 3.48 to 2.58. Therefore, as the construction cost increases, alternative 2 becomes less feasible. • With the yearly costs varying from -40% to +40%, the B/C ratio varies from 4.9 to 2.13. Therefore, as the yearly costs increase, alternative 2 becomes less feasible. • With the total benefits varying from -40% to +40%, the B/C varies from 1.77 to 4.16. Finally, it can be concluded that no matter what the changes are, alternative 2 will always be more feasible. 6. CONCLUSION The Tripoli-Beirut traffic congestion problem, and many other related problems, social environmental and economical, can be solved by constructing any one of the proposed railway networks. This transportation system will benefit the economy, the environment, and the society as a whole by reducing the traffic congestion on the Tripoli-Beirut route, reducing pollution emission from vehicles, increasing regional economic activities, decreasing road accidents, increasing employment opportunities. The research conducted on the old railway network has shown that rehabilitating the old railway is out of the question, since it is sustainably non-interresting. The LCCA with B/C ratio analysis conducted on the two project alternatives showed that constructing an underground subway network along the old railway or constructing an aboveground railway network along the old railway are both feasible. The incremental B/C ratio analysis suggested that the aboveground railway network is more economically favorable than the
  14. 14. International Journal of Civil Engineering and Technology (IJCIET), ISSN 0976 – 6308 (Print), ISSN 0976 – 6316(Online), Volume 5, Issue 5, May (2014), pp. 27-40 © IAEME 40 underground subway line. Additional sensitivity analysis, considering uncertainties in the discount rate, construction costs, operation and maintenance cost, and total benefits cash value, showed that with variation from -40% to +40%, the aboveground railway network is still favorable. Even though the economic study of this railway network turned out promising, the development of this project also depends on Lebanon’s political stability and its population’s acceptance of this new transportation service. 7. ACKNOWLEDGMENTS The authors acknowledge the help of SOTEG for its help in getting the data. REFERENCES [1] Economic and Social Commission for Western Asia (ESCWA), Documents and Publications Issued By ESCWA from 1 January 2010 to 31 December 2011, 2012, E/ESCWA/DOC/33, Beirut, Lebanon. [2] Chaaban B., Towards Unleaded and sulfur-free Transport Sector, Case Study of Lebanon, Seminar on clean Fuels and Vehicles in Western Asia and North Africa, 2004, Beirut, Lebanon. [3] IPT Energy Center, National Campaign for Air Pollution Reduction in Lebanon through Efficient energy Use in Land Transportation, 2013, Amchit, Lebanon. [4] J.L. Matta, An Economic Feasibility Study For A Railway Network Linking Tripoli To Beirut, MS Thesis, Faculty of Engineering, University of Balamand, 2013, Koura, Lebanon. [5] Ministry Of Environment, Lebanon’s Second National Communication to the United Nations Framework Convention on Climate Change, 2011, Beirut, Lebanon. [6] www.greenline.org.lb, “Facts Sheet”, surfed on March 2014.

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