Options for reducing external costs from freight transport along the Brenner corridor

The volume of internal freight transport in Europe amounts to approximately 2300 billion tkm [1]; 75.3 and 18.3% of them are transported, respectively, by road and by rail. With 86.5% of its total tkm transported by road and a mere 13.4% by rail (0.1% via inland navigable waters), Italy ranks as one of the lowest European countries – far from Latvia’s lead (nearly 80% by rail). In Europe, the transport industry accounts for 28.5% of total CO₂ emissions [2]. Of road emissions, 38% is produced by freight transport. Transport, in addition to being responsible for approximately one third of total CO₂ emissions and energy consumption in the European Union (EU), is also cause of other external effects such as congestion, noise pollution, air pollution and accidents, which have a direct impact on citizens’ lives.

Among terrestrial systems, numerous reports indicate rail as the most sustainable one, capable of promoting a reduction in the external costs resulting from freight transport without curbing mobility [3‐7]. Also the scientific literature that deals with modal shift and the related reduction of transport externalities is vast [8‐15]. It confirms the importance of a balanced system, where rail transport should have a more preeminent role. For this reason, the EU has defined a strategy to rebalance the transport modes, reducing the road component. In the Transport White Paper [16], the main objective is to transfer 30% of freight currently carried out by road to other transport modes, such as rail and inland waters by 2030 and 50% by 2050.

In the Alpine context, promoting rail freight transport has even a greater value: its mountainous geomorphological conformation can generate external costs that are up to four times higher than flat areas [17]. However, promoting railway entails numerous critical issues, such as the technical difficulties in constructing new railway infrastructures. Furthermore, the differences in the policies and measures introduced along the Alpine arc has, over time, created a disproportion in the distribution of flows between the corridors. Considering the volume of traffic along the five main transalpine axes, in 2015, 42% crossed Brenner, 26% Gotthard, 17% Tarvisio and only 15% the Italian-French corridors of Mont Blanc and Fréjus. The modal split varies considerably, in accordance with the policies adopted by the single countries. Simply sharing infrastructural decisions at a European level, although necessary, is not sufficient to guarantee a positive result towards the use of rail for freight transport.

This article focuses on the condition of Brenner, the most travelled corridor in the Alps. Nearly 44 million tonnes of goods are transported every year via Brenner; of these, less than 30% are transported by rail. This leads to systematically exceeding NO₂ limits and a series of negative consequences for populations living nearby [18]. In light of this condition, the Tyrol-South Tyrol-Trentino Euroregion (core of the Brenner corridor) has established more ambitious objectives than those set at the EU level: balancing the transport modes by 2027 and reversing them by 2035 [19]. This paper has the double objective of providing exploratory and interpretative support to the various existing measures in order to facilitate the shift towards rail, and calculating the environmental benefit, in terms of external costs (local and global pollutant emissions, noise, congestion and accidents), of achieving Euroregional objectives. Furthermore, the analysis of the Brenner corridor demonstrates the need for more coordination between the different policy levels, in order to obtain a higher modal shift towards rail.

The article is structured as follows: Section 2 provides a description of the Brenner corridor from a geographical and infrastructural perspective. Section 3 provides a general overview of the policies proposed at European, Alpine and Euroregional levels to facilitate the modal shift. Section 4 proposes an overview of potential or existing measures applied to achieve the specified objectives. Section 5 presents a calculation of the external costs deriving from the implementation of the Euroregion strategy and the resulting environmental benefit compared to the status quo. Lastly, Section 6 summarises the main topics and the political implications generated by specific transport measures.

The Brenner corridor is the central part of the Munich-Verona corridor, which is part of the north-south E45 European backbone connecting Finland to Italy and Malta. It is the most important pass on a European level, considering the average number of transiting freight and passenger vehicles – 8908 and 18,846 vehicles respectively per day in 2015 [18] – and the fair morphological conditions (1378 m above sea level and a lower incline than other Alpine passes). Infrastructurally, the Brenner corridor is composed by the Brenner railway line (Verona-Brenner), the A22 Motorway (Modena-Brenner) and the SS12 state road (Table 1). The railway line constitutes 120 km of the total network in South Tyrol (290 km) and it is the only line run by freight trains. The SS12 state road overall measures 520 km and is divided into three main stretches; the first part from north belongs to South Tyrol and goes from the Brenner pass to Salorno (120 km). Lastly, the A22 Motorway (116 km in South Tyrol) is one of the most important motorways in Italy, as it connects the national network to Austria and Germany. In Italy, it intercepts the A1 (Milan-Rome) near Modena and the A4 (Milan-Venice) near Verona. These three infrastructures are summarised in the multimodal transport graph (Fig. 1), which shows the entire South Tyrolean territory and indicates the average costs and travel times. Table 1 shows the main infrastructural and management features of each infrastructure, as well as the ongoing projects that aims at improving their levels of service.

Referring to the freight volumes, in 2015, Brenner recorded the highest numbers for average daily heavy vehicle traffic (8908 vehicles/day), with more than twice the number of vehicles of Tarvisio (3464 vehicles/day) and Gotthard (3978 vehicles/day) – up 3.5% from 2014 and showing a growing trend [18]. In absolute terms, the Brenner corridor registered an increase in the total volume of freight transport (by both train and heavy vehicles, from 42.6 Mt. to 43.9 Mt. in 2015). The modal split still tends noticeably towards the road, with only 29% of goods transported by rail. By comparison, the Gotthard axis has the reverse of the Brenner corridor split: 63% by rail and 37% by road.

Three levels of international management and coordination of freight transport influence the Brenner corridor, each with specific responsibilities: the European Union, the Alpine Region and the Tyrol-South Tyrol-Trentino Euroregion (Fig. 2). The first level defines the general transport objectives at continental level and for each Member State. The White Paper on Transport [16] explains the reasons for increasing investments in the railway system by the European Union. They include moves towards sustainable transport modes with lower environmental impact, the development of a single supranational railway network that contributes to strengthen the European Single Market, and ultimately, growth in economy and employment. The second level coordinates all countries that have a part of their territory in the Alpine arc and share similar needs from an economic, social and environmental standpoint. The third is derived from a collaboration project among the regions belonging to the historical Tyrol – Tyrol itself (an Austrian federal state), Trentino and South Tyrol (both Italian autonomous provinces) – with the aim of facilitating cross-border, transnational and inter-regional cooperation. The Autonomous Province of Bolzano and the other regions of the Euroregion are defining an effective political strategy that encourages a shift in freight transport modes from road to rail, in accordance with the White Paper [16]. The following sections analyse each level that influences freight transport policies in the Brenner corridor, from macro scale (European Union) to local scale (Euroregion and Autonomous Province of Bolzano).

This paragraph describes the measures capable of promoting the modal shift from road to rail. Firstly, it is necessary to investigate the factors influencing the modal choice of shippers and freight forwarders, as well as the specific pros and cons of each transport mode [32]. If implemented in a coordinated manner on a trans-regional level, the analysis of the strengths and weaknesses of rail and road transport contributes to the development of a suitable strategy to support the desired modal diversion. The choice of a specific transport mode is determined by preferences expressed by the two key players involved at the beginning of the process – the carrier and the shipper. However, despite the latter being the practical organiser of the transport, its decision is strongly influenced by the former’s preference, who makes the choice according to the customer’s economic, financial and technical requirements. The factors influencing the modal choice can be grouped into two categories: “micro” and “macro”.

The micro factors represent the single elements capable of influencing the individual choice of the shippers [7]: (i) the shipping agent itself (railway accessibility, practices and customs of the decision makers); (ii) the shipped goods (size and type, density, value per unit of product, perishability, packaging features, etc.); (iii) the carrier (cost of shipment, delivery time, infrastructure capacity, service reliability, degree of security, service flexibility and frequency, availability of special equipment, customer service quality, transportation procedures, level of environmental sustainability, etc.); (iv) the shipment (distance travelled, train capacity, etc.).

The macro level factors influence the shippers’ choice in the medium and long term. A close relation was found between the economic growth (expressed as GDP) and freight volumes [33]. Economic growth does not have the same impact on road and rail freight transport. European manufacturing processes have changed drastically in recent years and freight transport has attempted to adapt to new market demands. On the one hand, many European countries are experiencing a decline in the quantity and size of the main industries and a dispersion of the manufacturing process (de-industrialisation of the region). On the other hand, growth in e-commerce is generating a logistical fragmentation of distribution journeys and, as a result, new demand for light vehicles in urban and peri-urban areas. It derives the need for transport of smaller volumes at a higher frequency [33]. Road transport is more competitive than rail transport when it comes to meeting this demand – and more attractive to a shipper in terms of cost and time. However, the point of view of shippers is important, but not exclusive. An element that influences the EU transport policy is the environmental protection and the sustainability of vehicles, which favour rail over road transport (see section 3). This element – not included in expenses incurred by the user, unless marginally – is becoming important in terms of planning, through a progressive internalisation of such values. Although the first two macroeconomic factors favour the road transport choice, the numerous incentives and subsidies provided by the EU to railways and intermodality drive the shipping agent towards choosing a lower impact vehicle.

The instruments that can directly or indirectly influence the modal choice by encouraging or discouraging a specific behaviour can be influenced through the application of two mechanisms: making the undesirable options less attractive (push measures) or increasing the attractiveness of the alternatives (pull measures). In the passenger transport sector, these mechanisms are generally used to discourage the use of private cars and increase individuals’ inclination to public and alternative transport. Referring to freight transport, the two groups can be defined as follows:

These measures can be arranged into three closely interconnected groups: (i) measures affecting the infrastructures (railway network, terminals, etc.); (ii) measures affecting service management (speed, times, costs, flexibility, intermodality, interoperability, etc.); and (iii) regulatory measures governing the entire system according to individual influence mechanisms (Fig. 3). The next sections take into consideration the measures applied and applicable to the Alpine arc to achieve the objectives proposed by the EU, the Alpine Convention, the EUSALP macro strategy and the Tyrol-South Tyrol-Trentino Euroregion. The first two groups – infrastructure and vehicles, and service management – contain pull measures alone, aiming to make the freight transport system more appealing and competitive by increasing its functional and organisational attractiveness. The third group – regulatory measures – includes all actions to encourage the use of rail transport and discourage the use of road transport. For each group, Tables 3, 4 and 5 show the selected measures, followed by a brief description and States in which they have been applied.

This paragraph focuses on the study of the external costs resulting from freight transport and on the environmental benefit that can be generated from the achievement of the objectives proposed by the resolution proposed by Tyrol-South Tyrol-Trentino Euroregion [19]. To calculate this benefit, the current external costs generated by freight transport along the Brenner corridor (Phase 0–2015) have to be evaluated. A calculation is then made of the external costs generated by freight transport in two different scenarios. In Scenario 1, the current modal split does not change (29% rail – 71% road); in Scenario 2 the external costs are calculated if a balance in the modal split is achieved (50% rail-50% road; Phase 1–2027) and if the current split is reversed (71% rail - 29% road; Phase 2–2035). By subtracting the external costs generated by the new modal split (Phase 1 and Phase 2) in Scenario 2 from those calculated in Scenario 1, the economic saving generated by the Euregion resolution can be obtained.

Brenner is the main transalpine corridor for volumes of goods transported and further growth is expected over the coming years. If the modal split remains similar to the last 5 years (71% by road and 29% by rail), the population living along the corridor will suffer even greater consequences in terms of external effects – these include air pollution (especially NO₂, which records constant excesses compared to the EU threshold), noise pollution and congestion. These external costs for the next 20 years have been quantified at €1002 M, a value equal to one fifth of the annual expenses incurred by the Autonomous Province of Bolzano (approximately €5500 M in 2016).

This value derives from the initial assumptions highlighted in section 5, which have to be considered in the interpretation of the results. They include the forecast about future tons transported along the Brenner line, the preliminary definition of a road and rail vehicle type, the analysis limited to the TTW emissions, as well as the absence of congestion for railway. Furthermore, the selection of a unitary value for each transport externality is a critical issue, due to the numerous scientific and economic sources of uncertainty. In this paper, we have decided to adopt Ricardo-AEA [4] as a reference document, in line with the long-term objectives set on a continental level. Other unitary values may obviously lead to different results.

In order to address the critical condition along the Brenner, the Euroregion has proposed an ambitious objective: to reverse the percentages registered in last 5 years by 2035, thus achieving a modal share similar to the one recorded along the Gotthard axis. The calculations provided in Section 5 reveal that this configuration is expected to guarantee an external cost saving of approximately €262 M. This is more than twice the amount of annual subsidies given to public transport in South Tyrol and amounts to approximately 4.7% of the annual public expenditure of the Autonomous Province of Bolzano.

To achieve this result, many measures have to be taken jointly. In Section 4, they have been divided into infrastructure/services, service management and regulatory measures. Beyond the theoretical framework of reference, it is appropriate to consider the ones for which implementation has been planned. Firstly, significant support could result from the commissioning of the new high-speed/high-capacity railway line, whose central section - the BBT - is currently under construction. However, the construction of the tunnel alone, unless accompanied by other regulatory measures, may have negative consequences in terms of external effects, as a result of the additional demand generated [37]. In this sense, the incentive for combined transport along the regional stretch of the Brenner corridor, recently planned by a resolution of the Autonomous Province of Bolzano [19], may be an important accompanying measure. On the other hand, measures for discouraging road traffic, such as those adopted in part by nearby Tyrol, must be considered as integrative. However, they have to be planned in an integrated way and not –as in some cases still happens today- only in specific stretches of the line. This approach leads to the consequences that are registered with great emphasis by the news [38] and that are counterproductive in terms of management of the traffic. The Swiss case of the performance-related heavy vehicle charge (HVC) is an interesting approach, valid for a broader territorial area. Introduced in 2001, this federal charge is based on a set of parameters, including the weight of the vehicle, the Euro class and the amount of kilometres driven in Switzerland and the principality of Liechtenstein. HVC is valid for all heavy vehicles exceeding 3.5 and it includes a constant and gradual update of the fares. Two-thirds of the revenues are adopted to realize the new HS railway infrastructures, while the remaining one-third is distributed to the cantons, to be invested in the improvement of road infrastructures.

Alongside these initiatives, we must not overlook measures for reducing the pollution produced by road vehicles, such as the technological improvement of vehicle fleets and the use of alternative fuels. Though they do not act directly on modal diversion, they may contribute to reducing local and global emissions and, in some cases, noise pollution [39]. In this sense, the Bolzano hydrogen centre is an interesting experiment (the first in Italy), which could be replicated at other points of the network to create a real hydrogen corridor. Likewise, developments in Liquefied Natural Gas (LNG) show interesting potential for heavy vehicles – these should be considered, given that compared with a Euro 6 diesel-fuelled vehicle, LNG reduces NO_x emissions by more than 60% and TTW CO₂ emissions by 10%.

Only a combination of various initiatives might contribute to a real reduction in external costs generated by freight transport without a simultaneous reduction in demand, in accordance with the indications of the White Paper on Transport. The path towards this objective seems long, and it will inevitably involve the growth in the railway sector.