Toll optimisation on river crossings serving large cities

There is renewed interest in the private sector financing and operation of major transportation projects, in which a significant financial contribution comes from toll revenues. Tolling is ideally suited to river crossings, where the tolls are relatively easy to administer and collect. Because of their span, bridges over river estuaries are particularly expensive to build and maintain and so need to be put on a firm financial footing. Toll revenue is therefore a key consideration if such projects are to be financially viable and risk is to be minimised. There may be other issues to do with who benefits from the bridge and whether differential tolls should apply to local residents and non-resident bridge users. In addition, such bridges may be linked to wider economic objectives, such as local development and regeneration. This paper describes a model for estimating optimum bridge tolls, from both a financial and a welfare perspective and provides a case study that illustrates a range of scenarios that are of general interest.