ROLE OF DISCOUNT RATES AND PILOT PROJECTS IN ITS - PROJECT CBA

This paper discusses two emerging issues in transport project appraisal. First, the discount rate may need to vary as many of the current projects have maintenance times shorter than the conventional transport projects, and these projects are less vulnerable to changes in the investment climate. Also, accumulating benefits from pilot projects can improve the benefit/cost ratio of these investments, because the experiences gained in the design of the pilot project will positively reduce similar expenses in following projects utilising the same technology solutions. The proposed developments to the CBA framework would improve capturing the specific features of the ITS investments.