Stephen Rees's blog

Thoughts about the relationships between transport and the urban area it serves

Forecasting demand for Gateway.

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There are are at two huge failings in the way that the Gateway programs views the future. The first one is its convenient blindness to any realistic assessment of its effect on personal mobility. Basically it is assumed that the number of motorised trips will not change between the with and without project scenarios. And I have written here enough about why that is simply unbelievable.

The second one is the forecast that trade between North America and China will continue to grow at the same rate it was growing up until a couple of years ago when high gas prices and the credit crunch hit the US. At the Livable Blog Nic S notes

Captain Gordon Houston of the new Vancouver Port Authority, which includes all ports in the lower mainland, keeps stressing that we need all this extra capacity. He does not quote any studies to support the expansions and the only business case he makes is that he’s the expert here and we simply need to follow his advice.

What he found was an article in the Sacramento B that describes recent changes in the way international shipping has been responding to a different commercial reality.

Since, apparently, we have no reference documents that we can go to to determine what assumptions were made by the Port or the Gateway Council when it dreamed up this “plan”  we cannot determine if they did what “due diligence” would require. We do know that the province made ludicrous assumptions – and refuses point blank to do any further work, now that the world seems to be unfolding in a way that was not anticipated when these ideas first surfaced.  I am not picking on the province, or the Port, because it seems to have been a common problem. Not so long ago I quoted the head of American Airlines as saying “there was no game plan for $120 a barrel oil”.

What the article cited shows is that expensive fuel, and a shift in economic fortunes between the US and Europe, has already had an impact on container shipping. Europe has been hit much less hard than the US since it gets more dollars for its euros now. I think it is extremely unlikely that anyone at the Port or the MoT looked at gas prices this high when they did their demand forecasts. Indeed as Eric Doherty points out in another Livable Blog article, neither did the US Energy Information Administration – whose forecasts have been consistently wrong and far too optimistic.

We also know that the Vancouver Port is completely unconcerned about Price Rupert, the North West passage opening up decades before anyone expected and the New Panama Canal coming online. Now if a commercial corporation behaved like that you would expect the shareholders to kick up a fuss at the AGM – and probably one of those aggressive investment trusts to start making noises in the boardroom. But our strange not public not private not responsible to anyone but our mates “professional boards” do not have to worry about any oversight. After all it is tax payers money they are spending. Though I fervently hope that at some stage Sheila Fraser takes a long hard look at Transport Canada and how it seems to have shrugged off any responsibility for anything connected to Gateway in any of its multifarious manifestations.

Apart from the pilings now appearing at Deltaport, it is not too late to stop all this. All it takes is for Gordon Campbell and Kevin Falcon to admit that their forecasts were wrong – just like everybody elses. No shame in that.

But if you think they will do that, I have a bridge you can buy.

Written by Stephen Rees

May 18, 2008 at 3:37 pm

Posted in Economics, Gateway

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