Valuing Toowoomba’s Second Range Crossing

What value can we put on the capital cost per vehicle using the $1.6 billion Toowoomba Second Range Crossing?

Let’s assume: in a 25 year appraisal period traffic volumes grow 3.5% p.a.; some 75% of some 23,000 vehicles per day divert to the crossing; and a 4% real discount rate. How does just under $12 a vehicle sound?

Bump traffic growth to 6% p.a., raise diversion to 85% diversion, and trim the discount rate to 3%, and you get just over $6.

Sets a bar, doesn’t it?

This project will only show a net economic benefit if benefits that are eventually identified are multiples of this.

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