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The deflationary phase is pushing increments for 2017 to the lowest levels in years. Too much or too little? Let us evaluate the investments made on our toll-road network. And the Brebemi case

Fabio Quinto

Individual concessions: the scenario

Let us start by looking at this year’s figures: the average increase was 0.77%, ranging between +0.64% for Autostrade per l’Italia to 4.6% for Satap between Torino and Piacenza. The Torino – Savona stretch stands out with a +2.46% increase, while “la Strada dei Parchi” (Parks Motorway/ Roma-Teramo and Torano-Pescara) scored a +1.62%, a +1.5% for the Milano-Serravalle and a +0.90% on the “Autostrada Tirrenica” (Tyrrhenian motorway-A12). Meanwhile, no increase was recorded on the A32 Torino-Bardonecchia, as well as on the “Autostrada dei Fiori” and on the Brennero stretch. But the real surprise comes from the newcomer, the Brebemi, already under fire for its high tolls and consequent scarce traffic flow, which recorded a + 7.88%. Overall, compared to previous years, toll increase is still at a record low: last year tolls increased by 0.86% while 2015  scored a +1.32%, still nothing compared to the blow back in 2014 + 3.9%, which followed the +2.9% in 2013 (which included a VAT increase), +3.51% in 2012, and + 3.3% in 2011.


The investment issue

How can such dynamics be explained then? Summarizing what is contained in the individual concessions between Anas (which held the position as granting authority and toll supervisor until 2013, as well as managing national highways and tool-roads such as the Salerno-Reggio Calabria) and companies currently managing the motorways, we can say that toll increments are allowed by the ministry of Infrastructure based on two key elements. First, inflation. But Italy closed 2016 in deflation for the first time since 1959, and tolls will, at best, drop. Second, investment returns. According to the Ministry of Infrastructure, "the costs incurred by the various managing companies during the period between October 1, 2015 and September 30, 2016 amounted to 764.183 million euro, of which 399.051 million Euros were recognized for the purposes of remuneration". Therefore, to see whether toll fee increases are justified or not, we have to look beyond investments alone.


Project financing and public funds

Take, for example, the Brebemi case. The reason behind the latest toll fee increment is clear: originally built in project financing with (initially) only private funds, this mega-toll-increase should be used to offset construction costs, around 2.4 billion euro. In reality, the average user, not to mention taxpayer, has already contributed to the construction of this toll road: as early as 2015, in fact, the State and the Lombardia Region rescued the Brebemi project lavishing public funds in the amount of 320 million euro. The super-increase, therefore, seems to be aimed at providing some relief to the coffers of the company, given the low traffic flow. The risk, however, is that at this rate traffic flow will become even scarcer, despite recent initiatives and discounts in favor of commuters.


Poor connections

We need to point out, however, that the Brebemi suffers from yet another problem, besides the high toll fees; poor connection to the rest of the motorway network. Following the opening of the TEEM (Milan’s outer ring-road) in 2015, in fact, traffic increased significantly over the previous year, reaching an average of 30thousand vehicles per day, of which 7thousand are heavy transport vehicles. Motorway connections, though, on both the Milan and Brescia side are still insufficient: the first is still missing a connection between the two new Cassanese and Rivoltana expressways leading to Milan’s Ring Road east, forcing motorists and truck drivers from Brescia to slip into roundabouts, traffic lights and queues before entering the Milan motorway junction – another expressway, the Paullese, located further south, could be used, but even here problems are similar and construction sites are, for now, simply not an option. On the Brescia side, however, a connection with the A4 towards the Ospitaletto tollgate is totally missing, and the same can be said for the "Corde molle" towards Azzano Mella. While connections with Brescia’s western bypass (and then to the A4) is guaranteed by a single lane link road in each direction.


The “Segrate river”

The question at this stage is: what is being done to complete these “missing links”? So far very little. The section through the Rivoltana remains to be done; same for the Cassanese, whose place is currently occupied by the "Segrate river", after the contracting company unluckily intercepted an aquifer turning the building site into a marsh back in 2009. However, in order to complete the Cassanese link, the former mammoth customs building in Segrate (which never became operational), must first be demolished, to be replaced, apparently, by a new shopping center and an adjoining stretch of the new expressway. Here the demolition work has already started and should be completed within a few months.


The Brescia “war”

What is happening around Brescia is rather indicative of how the granting system works in Italy and why tolls keep on rising. A few years ago Professor Giorgio Ragazzi entitled a book dedicated to the subject “I signori delle autostrade” (The lords of the motorways) in which he stated that private profit was the only logic driving management companies, under the rather “condescending” control of Anas (replaced now by the Ministry of Infrastructures), which proved quite "indulgent" in granting toll increments. When construction work on the Brebemi got underway, the idea was to have Centropadane (the company already managing the A21 between Brescia and Piacenza) build the stretch between Azzano Mella and Ospitaletto, and a few construction sites were in fact opened. Too bad, though, that in the meantime the grants expired in 2011. Meanwhile, no extension came from the State and the sites have been closed since. Now, finally, a new player, part of the Gavio group, has been awarded the concession, being determined to sort out one of the "bottlenecks" on the route by doubling the one-lane link road in each direction (around 5.6 km) between Travagliato and Brescia, with construction sites already in place. As expected, Autostrade per l’Italia, worried about losing traffic volumes on the A4, and related profits, immediately appealed to the Regional Administrative Court arguing - in a nutshell - that this new tiny stretch is not a "variant" at all (as argued by Gavio and Brebemi, as well as authorized by the CIPE), but a "new highway" connected to the A4, a possibility not covered by the relevant license.


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