A cost-benefit analysis of the extension of the Stockholm subway system Akalla-Barkarby

University essay from KTH/Hållbar utveckling, miljövetenskap och teknik

Abstract: The construction of the new subway extension between Akalla and Barkarby is a project that is already contracted upon and will be completed in 2025. Current studies on this subway extension shows that it is not profitable from a socioeconomic viewpoint but still the project is continued with which makes it an interesting study area. The aim of this report is to research the costs and benefits of the Akalla-Barkarby subway extension to see if there are other aspects, not included in the previous study, that has an impact on the profitability of the case. The main focus of this study is on social impacts that have often been overlooked in similar studies and are hard to quantify. The study was done through using a cost-benefit analysis quantifying the areas of investment cost, operating expenses, travel time, travel cost, real estate value, congestion, barrier effects, accessibility to work opportunities, accessibility to services, exercise, air pollution and accidents. A discount rate of 3.5 % was used and a life length of 35 years. It was divided in three different scenarios based on how large part of the new travelers that are predicted to be shifting to car to using the new subway. Scenarios one and two shows a negative NPV whereas scenario three shows a positive NPV. A change of above 14.65 % would mean that the investment is net positive. This shows that the project has a large potential to be profitable and also shows that the impacts from the social benefits account for a large part of the project’s benefits, which means that other studies might be lacking benefits and turns out net negative by not including social aspects.

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