The Observatory on "The Costs of Not Doing" reaches its sixth year of activity, concluding with this report (2011 Study) the second three-year cycle focused on the country's infrastructural development and on the costs of inertia for the community. In the 2009 Study, the first of the new three-year period of work, we measured the Costs of Not Doing over a 16-year time horizon, from 2009 to 2024, in the sectors of energy (electricity and gas), waste, road traffic ( motorways and toll ring roads) and railways (conventional and HS/HC railways) and the water sector. Through a methodology developed by Agici researchers, based in part on the Cost Benefit Analysis, the economic, environmental and social impacts associated with delays in strategic infrastructures in our country were assessed. Over the years, the Observatory has analyzed the causes of delays by formulating proactive reflections, also aimed at redefining the roles of the subjects involved in the infrastructure construction processes: companies, the political system, public administration, lenders. In the 2010 Study a model was proposed for the realization of the works: the Standardized Procedure. It is a process which, through clear, distinct and well-articulated phases, allows for irrevocable and shared decisions to be reached. This year, the activities of the Observatory have considered: 1. The revision of the Policy for the Energy sector; 2. The monitoring of infrastructural development in the three-year period 2009-2011 and the measurement of the Benefits of Having Done and the Costs of Not Having Done on the basis of the assumptions and parameters of the 2009 Study; 3. The application of the Standardized Procedure to a series of real infrastructures; 4. The preparation of 10 guidelines for a framework law for the revitalization of infrastructures. Regarding the first point, a series of phenomena has profoundly influenced both supply and demand in the Italian energy sector and has led us to modify the Policy assumptions defined in 2009. The second point concerns the monitoring of the infrastructures brought into operation in the three-year period 2009-2011; by comparing the actual achievements of the three-year period with the needs estimated in the 2009 Study, we calculated both the Costs of Not Having Done, i.e. what we have already paid due to inertia, and the Benefits of Having Done, i.e. the expenses avoided thanks to the achievements. With regard to the third theme, we have analyzed six works with a particularly critical history of authorization. Taking the Standardized Procedure defined last year as a reference, we proposed solutions that would have simplified and speeded up the process of each infrastructure.
The 2011 objectives of the CNF Observatory
In the 2009 Study we measured CNF in energy, waste, road and rail traffic and water. Below we summarize the data presented at the time, specifying, however, that a significant change has been introduced for the electricity sector. In fact, it was characterized by a series of events that changed the profiles of supply and demand: the economic-financial crisis significantly reduced energy demand; the referendum blocked the return to nuclear power; the strong growth of the national electricity generation has created a situation of overcapacity. This has led to a review of the sector development policy and a recalculation of the CNF. Power. As regards electricity production plants, it emerged that not building more than 12 additional GW by 2024 would have generated a CNF of over €4 billion. Not building 5.500 km of new networks could lead to costs of €20 billion. Finally, the failure to build, from a strategic point of view, a 9 G(m3) regasification terminal would have produced a CNF of €2,5 billion. The overall CNF of the energy sector was estimated at €26 billion. Waste. Failure to do 97 200 kton waste-to-energy plants and 165 50 kton composters was estimated to cause CNF of €24,7 billion: 21,4 billion for waste-to-energy plants and 3,3 billion for composters. Highways. The failure to build around 1.700 km of motorway resulted in a total cost of €2024 billion by 138,5. Railways. The CNF of the railway sector was estimated at €157,4 billion: €65,4 billion due to the failure to build 848 km of high-speed railways and €92 billion if 700 km of conventional lines had not been built. Water. In the sector there was a CNF of €28,9 billion generated by the failure to replace 53.840 km of aqueducts and by the absence of purification plants for 8 million equivalent inhabitants. In conclusion, it emerged that not doing in the period 2009-2024 could have generated costs for the community equal to €376 billion (Figure 1 – I CNF 2009-2024)
Performance indicators and achievements 2009-2011
Let's see, therefore, the dynamics that actually occurred in the three-year period 2009-2011. The aim, in line with the objectives of the Observatory, is to evaluate the Costs of Not Having Done for the period and for the individual years, ie the costs actually incurred by the country for delays. These annual costs emerge from the comparison between the Policy Scenario of the 20091 Study2009 and the achievements of 2010, 2011 and 2. Figure 2009 details the dynamics in the period 2011-2.700. In the electricity sector, more than 1.500 MW of production plants (excluding photovoltaic and wind for the reasons we will explain) and almost 2.100 km of new power lines have come into operation. However, nothing was done in the regasification terminal sector. In waste, waste-to-energy plants were built for 550 kton/year and composting plants for 153 kton/year. In terms of logistics, 193 km of motorway traffic was opened up, while construction in the railway sector amounted to 122 km for the HS/HC lines and 3.100 km for the conventional sections. In the water sector, we estimate that around 1 km of networks have been replaced and over 2009 million PE served by purifiers. Using these data as a starting point, we calculated, using performance indicators: the Expected Cost of Not Doing (CNFP) for each year; the Costs of Not Having Done (CNAF), i.e. the charges incurred due to the failure or delay in covering the requirement; the Benefits of Having Done (BAF) for the community that emerge from the putting into operation of the infrastructures. Some benefits were greater than budgeted (extra-BAF) as the achievements were higher than the annual policy objectives. Finally, on the basis of the 2011-2024 achievements, we estimated the class, sector and overall CNF at 2 (residual CNF). The residual CNF decreases every year both for new infrastructures (BAF) and for failed implementations (CNAF); the latter costs are the "hidden bill" that the country disburses annually for inertia. Figure 2009 – Infrastructural constructions in the three-year period 2011-XNUMX
A slow three-year period: the BAFs and the CNAFs 2009-2011
Figure 2 clearly shows how the actual achievements in the three-year period were often lower than those of the Policy. For various reasons, certainly including the 2008 crisis, the three-year period 2009-2011 was therefore a rather negative period for infrastructures. It is true that some sectors have moved more than others (and in some cases have exceeded the policy objectives set in 2009), but the inertia found in the environmental sectors and in some logistics sectors has conditioned the final result. Figure 3 quantifies the values shown in Figure 2 in economic terms: if nothing had been done, the country would have incurred costs of €70 billion (CNFP). The achievements in the three-year period have avoided part of these costs, i.e. BAF for €50,1 billion. Of these, around €10 billion are extra-BAF, a sign that in a few years more has been done than budgeted. However, inaction has cost the community €24 billion (CNAF). In energy, developments in power plants and the transmission network have balanced the static nature of the regasification plants; the BAF of the sector amounted to €6,2 billion, of which €1,9 billion extra-BAF, while the CNAF amounted to €500 million. In waste, on the other hand, despite the important achievements of 2009, static prevailed: a CNAF of €1,7 billion stands out against a BAF of €2,9 billion. On motorways, constructions below the Policy objectives generated a CNAF of €13,5 billion, compared with a BAF of €12,5 billion. The railways conclude the three-year period with a CNAF of €3,9 billion, concentrated in the conventional ones; while the BAF amounted to €27 billion. In the water sector, the few investments lead to costs of €4,2 billion, compared to BAF for €1,2 billion. In conclusion, and with great prudence, inertia costs about €8 billion each year, equal to €130 per capita per year. Figure 3 – The evolution of CNFs in the period 2009-2024
The energy sector
The energy sector in the three-year period 2009-2011
Unlike the other sectors analyzed by the Observatory, the three-year period 2009-2011 was positive for the energy sector. As in the four-year period 2005-20082, development was sustained even if more balanced: in the electricity sector investments were oriented towards coal-fired plants and renewable sources, useful for rebalancing the production mix, and towards transport and the transformation stations, fundamental elements for making the best use of the existing production park. The realizations were, therefore, in line with the Policies and sometimes even superior; the only drawback in the sector is represented by the regasification terminals which have remained at a standstill. It is important to remember that the sector had already developed significantly in the period 2005-2008: thermal plants for 16.000 MW and over 1.300 km of new NTG lines came into operation, also thanks to facilitating regulations3. These developments have, on the one hand, made production more efficient and made the system safer and supplies constant; on the other, however, they have aggravated the geographical imbalance and the sources4. In the same period, natural gas import capacity also grew by 37 billion m3 thanks to the construction of the Rovigo regasification terminal and the Greenstream pipeline and the expansion of the TAG, TTPC and Transitgas pipelines. It should also be said that the 2008 crisis reduced effective energy consumption and also attenuated medium-long term projections. Furthermore, the intense developments have today led to an overcapacity situation in the electricity system. Due to these dynamics, in the three-year period 2009-2011 the priorities of the sector shifted from the security of supplies, which in any case must be maintained, to the more balanced development of the system as a whole. This by pursuing: less dependence on fossil fuels; a more efficient use of existing infrastructures; the reduction of electricity and gas costs5. In this sense, the focus has shifted to investments in (cheap) renewables, coal-fired power plants, electricity transmission networks and regasification. In conclusion, the CNF of the sector decreased significantly over the three-year period: it went from €26 billion to €19,9 billion, thanks to benefits of approximately €6,2 billion, including €2 billion of extra-BAF . This made it possible to offset the CNAF generated by the inactivity of the regasification terminals. Figure 4 – Energy: the trend of CNFs in the three-year period 2009
The production facilities
Production capacity has grown over the three-year period in line with Policy assumptions. The thermoelectric plants, in particular the coal-fired ones, saw a certain development in the two-year period 2009-2010 due to the entry into operation of two groups of the Torrevaldaliga Nord plant; however, nothing in 2011. Renewables (without wind and photovoltaic power, for which the net benefits are doubtful) experienced intense development in the three years considered6. More specifically, both hydroelectric and geothermal plants passed the Policy in 2009 and 2010; this amply counterbalanced the static nature of 2011. Instead, as far as biomass plants are concerned, they showed extra productions in all the years considered. In summary, in the period 2009-2011 the following came into operation: • 1.315 MW from coal • 253 MW from hydroelectric • 61 MW from geothermal • 1.100 MW from biomass It should be noted that in the same period approximately 2.300 MW of wind and almost 10.000 MW of photovoltaics. Overall, albeit with the aforementioned exclusion, against a capacity envisaged in the Policy of over 2.300 MW, approximately 2.700 MW came into operation in the three-year period. The high outputs reduced the CNFs which went from 4 to 3,2 billion €, thanks to a BAF of over 800 million €. The more than positive achievements in renewables show a net extra-BAF7 of around €100 million. The extra-BAF generated in the two-year period 2009-2010 more than compensated for the CNAF of 2011. Figure 5 – Power plants: the trend of CNF and constructions in the three-year period 2009-2011
The power lines
In the three-year period considered, the development of the electricity grid was particularly intense. In addition to the high and very high voltage transmission networks, numerous electrical stations have come into operation, which are very important for the exploitation of renewables. Of particular importance is the inauguration in 2009 and 2010 of the two SAPEI submarine cables, essential for the exploitation of thermoelectric production and for those from wind sources in the Sardinia region. In particular, the following came into operation in the three-year period: • 610 km of grid in 2009 • 585 km of grid in 2010 • 360 km of grid in 2011 As indicated by Terna, a total of almost 1.550 additional km of grids were installed, 50% more than the approximately 1.000 km envisaged by the Policy. With a view to balancing the electricity system, the development of the grid elements is essential. In fact, they make it possible to avoid supply interruptions; to unlock the most efficient production capacities, reducing electricity park emissions and generation costs; contain network losses, avoiding the construction of new plants, which are useless also given the country's overcapacity situation. The development of the network made it possible to significantly reduce the sector's CNF, which went from €19,5 billion to €14,2 billion thanks to a BAF of €5,3 billion; the latter includes an extra-BAF of approximately €1,7 billion. In this context, the CNAFs were null. Figure 6 – Power lines: the trend of CNF and constructions in the three-year period 2009-2011
The regasifiers
The class in question remained unchanged over the three-year period. Indeed, the strategic importance of these plants has been partially reduced. This is mainly due to two factors: the reduction in consumption and the development of infrastructures in recent years. Furthermore, both new gas pipelines (Galsi, TAP and Southstream) and extensions of the existing ones (Greenstream) are planned. With this in mind, the new Policy for the sector reduces the need for new infrastructures of this type. In particular, new regasification terminals are not needed to satisfy domestic demand, while the issue of the strategic nature of the diversification of supply sources and the creation of a gas hub in the country remains substantially valid. For these purposes, the additional capacity requirement can be estimated at 9 G(m3). In conclusion, the CNF trend for these plants reflects non-constructions. The CNF is unchanged and equal to €2,5 billion (hub hypothesis), while the CNAF, ie the cost incurred for inertia, is approximately €460 million.
Conclusions
Production overcapacity, underutilized new plants, abandonment of nuclear power, mix and location imbalances, high cost of renewables, static demand projections, still high costs, are among the issues that will need to be carefully evaluated at government level to set new energy policies. Policies that will have to focus more on the efficiency of consumption and on the "intelligent" development of the networks rather than on the disorganized growth of new generation capacity. Figure 7 – Regasification terminals: CNF trend in the three-year period 2009-2011
The waste sector in the three-year period 2009-2011
The infrastructural development of the waste sector in the three-year period 2009-2011 was uneven in the various sectors, resulting overall negative. The waste-to-energy sector got off to a good start, with a very positive 2009, to then decline in 2010 and even more in 2011. The construction of composting plants, on the other hand, always remained below the Policy objectives. Overall, in the three-year period the following were built: • 9 waste-to-energy plants (2 new and 7 refurbished) for an additional capacity of 2,1 million tons of MSW per year • composting plants with a total capacity of around 550 ktons/year. As highlighted, the particularly positive figure for 2009 is mainly due to the entry into operation of the Campania plant of Acerra, with a capacity of 1,2 million tons/year, which made it possible at least in part to offset the inertia of the years subsequent. The achievements of the three-year period reduced the CNF by 2024 slightly, which went from €24,7 billion to €22,3 billion, thanks to a BAF of €3,1 billion, including an extra-BAF of around €550 million . The inertia generated a substantial CNAF, only partially offset by the extra-BAFs of 2009. In conclusion, the costs already incurred in the three-year period 2009-2011 for the failure to achieve the Policy objectives amounted to €1,5 billion. Added to this are the €22,3 billion that the community risks paying if nothing more is done until 2024. The poor infrastructural development of the sector reflects a series of critical issues that have afflicted the system for years now. In the first place, the strong lack of homogeneity between the North and South of the country: in many regions of the North, for example, the percentages of separate waste collection exceed the European average, while in the South it does not reach 15%. Furthermore, the RD does not always translate into material recovery, and a significant share of waste goes to landfill. Landfill still remains the main form of disposal, with 49% on a national average. Furthermore, the fragmentation of the operators does not allow for the mobilization of the technological and financial resources necessary for the modernization of the sector. Added to this are the uncertain times for authorizations for new plants and the fragmentation of responsibilities between the different levels of government, which discourage potential investors. Figure 8 – Waste: CNF trend in the three-year period 2009-2011
The waste-to-energy plants
In the three-year period 2009-2011, the sector therefore grew more than it did in the previous three-year period even if, overall, it remained below the Policy objectives. Four plants started up in 2009, including Acerra, while in 2010 and 2011 there were 2 and 3 respectively, among other things small. In detail, these are the plants of Acerra (1.200 kton/y), and Rome (75 kton) and the restart of those of Padua (100 kton/y), Modena (240 kton/y), Coriano (140 kton/y /a), of San Vittore (200 kton/y), of Bolzano (130 kton), of Montale (39 kton) and of Rufina (68 kton). In summary, the waste-to-energy capacity increased by 2,1 million tons per year (1,6 in 2009, 0,3 in 2010 and 0,2 in 2011), reducing the theoretical requirement from 310 to 270 million tons. The plant requirement was thus reduced in the period from 97 to 85 200 kton waste-to-energy plants. The incidence of waste-to-energy urban waste on the total waste produced rises from 18,1% to 24,7%, a significant result, but still far from the 60% of the Policy which is based on a 65% RD, however penalized by no modest subsidies. As Figure 9 shows, the start-ups of these two years have made it possible to avoid costs of €2,6 billion (BAF), reducing the sector's CNF from €21,4 to €18,7 billion. However, the Costs of Not Having Done, already paid due to the inertia of this plant class, amount to €1,4 billion. Figure 9 – Waste-to-energy plants: the trend of CNF and realizations in the three-year period 2009-2011
Composting plants
The construction of composting plants was rather modest in the three-year period. Capacity has grown overall by 550 ktons/year. In three years, the Policy objective envisaged for just one year was achieved. The share of urban solid waste treated in the plants increased slightly from 9,5% in 2008 to 10,7% in 2011. The development, albeit modest, of the composting capacity is due to the entry into operation in 2009 of plants for about 150 ktons, and of plants for about 200 ktons both in 2010 and in 20118. The infrastructural requirement has decreased from 69 to 60 units of 50 ktons each. In conclusion, due to the failure to achieve the annual Policy objectives, the CNF of the sector in 2024 decreased slightly, going from €3,3 to €3,1 billion. The inertia instead generated costs for the community of around €380 million against lost costs for a total of €250 million.
Conclusions
To relaunch the sector it is necessary to activate strong policies to attract private capital by making, for example, regional waste-to-energy objectives obligatory9. We also need clear sector legislation that gives sufficient guarantees to potential investors and a clear definition of the responsibilities between the various governing bodies. Finally, in addition to measures suitable for promoting the dimensional growth of operators, it appears useful to have a sector Authority which defines clear rules and provides stable rules to the system. Figure 10 – Composting plants: the trend of CNF and realizations in the three-year period 2009-2011
The highway sector
The road system sector in the three-year period 2009-2011
A three-year period of small steps forward for the motorways, but not enough to make up for the delay accumulated in recent decades. Constructions for 153 km from 2009 to 2011 have some encouraging value (especially in 2010), but are still far from reasonable policy objectives for 2024. The inertia translates into costs for accidents, the persistence of congestion, as well as unresolved impacts environmental. Indeed, in the three-year period we estimated CNAF at €13,5 billion (Figure 11). The 153 km built in the period should be compared with the 324 km established by our Policy (108 km per year). It should be emphasized that the projects over the three-year period include both the new motorway sections and the widening of the existing sections to three and four lanes. For the purposes of our analysis, in fact, the upgrading of existing works substantially improves road conditions and generates significant benefits, reducing congestion and increasing the safety of the motorway network. The achievements, although insufficient, nevertheless produced BAF equal to €12,5 billion in the three-year period, thus reducing the value of the sector's CNF in 2024 from €138,5 to €126 billion. However, it should be emphasized that the aforementioned CNAF of €13,5 billion weighs on the individual citizen for €75 a year. Overall, the infrastructure requirement by 2024 will go from 1.720 km to around 1.567 km, far from the 1.400 km envisaged by the Policy. In particular, the following were built in the three-year period, including upgrades and new motorways: • 33 km in 2009; • 70km in 2010; • 50 km in 2011. In 2009 the 33 km refer to: a section of the Portogruaro-Conegliano road (1,8 km); a section of the Catania-Syracuse-Gela road (25 km); widening the A1 Casalecchio-Sasso Marconi to three lanes (4 km); a section of the Southern Highways (2 km). The opening of these works to traffic resulted in BAF for €3,8 billion, compared with a much higher CNAF of €5 billion. In 2010, the 70 km were divided between: the completion of the Portogruaro-Conegliano (about 3 km); the widening of the southern motorways to three lanes (approximately 4 km); the widening of the A14 to three lanes in the Ancona Sud- Porto San Elpidio section (37 km) and the modernization and upgrading of two sections of the Salerno-Reggio Calabria: the Sala Consilina- Padula (16 km) and the Gioia Tauro- Palms (10km). Figure 11 – Motorways: the trend of CNFs in the three-year period 2009-2011
Although they are higher than in 2009, the achievements do not reach the objectives of the Policy and so, against a BAF of €6 billion, the CNAF is €2,6 billion. In 2011, the opening to traffic of a new section of the Asti-Cuneo (10 km) and the modernization of about 40 km of existing motorways is expected: a section of the Salerno-Reggio Calabria (6 km) and two sections of the A1 Barberino-Incisa (13,5 km). This results in a BAF of €2,5 billion, compared with a CNAF of €6 billion. As summarized in Figure 12, the opening of 143 km of motorways in the three-year period (red line) is not sufficient to achieve the Policy objectives estimated by us for the period 2009-2024 (blue line); on the contrary, a clear divergence appears. Overall, therefore, the insufficient development of the motorway sector and toll ring roads does not obviate the country's infrastructural deficit, proving to be inadequate for the needs of demand, and with respect to the development programs of the main European countries.
Conclusions
It is well known that an effective and efficient motorway network is the key to fostering the country's long-term competitiveness. Just as a correct policy of the sector should aim at the real priorities deriving from the reading of the effective needs of the territory. In this sense, in-depth Cost-Benefit analyzes are essential to avoid waste of resources especially in the current phase of financial constraints and slow development of the country. Last but not least, the choices must then be aimed at relaunching the overall logistics system (railways, ports, freight villages, etc.) which today constitutes a strong constraint on economic and social growth processes. Figure 12 – Motorways: constructions in the three-year period 2009-2011
The railway sector
The railway sector in the three-year period 2009-2011
The results in the railway sector are, more than in other cases, conditioned by the methodology adopted: that is, only the infrastructures that have actually come into operation are considered, which are obviously the result of the efforts made in previous years. This explains the decreasing trend in the period 2009-2011 both for the High Speed and High Capacity (HS/HC) sections, and for the upgrading of the conventional lines. 2009 was characterized by higher growth than the average annual value of the Policy: the inauguration of the HS/HC between Milan-Rome-Naples was accompanied by new sections and the upgrading of conventional lines. This resulted in a BAF of €17,2 billion, much higher than the CNFP of €9,8 billion, thus generating an extra-BAF of €7,4 billion (Figure 13). In 2010, the achievements below the Policy, especially in the conventional lines, determine a CNAF of €2,7 billion, offset however by a BAF of €7,1 billion. Finally, in 2011, despite a lower development than in previous years of conventional lines, no activation of HS/HC lines was recorded. This results in a BAF of €3,1 billion, and a CNAF of €6,8 billion. Overall, in the three-year period 2009-2011, a cumulative BAF emerges of €27,3 billion, of which €7,4 billion extra-BAF; this thanks to the notable achievements of 2009 in the AV/AC. However, there is a CNAF of €2,2 billion, essentially due to the poor implementation between 2010 and 2011.
The HS/AC railways
The achievements of the last five years for the HS/HC railway lines have made it possible to bring the country to a good level of infrastructure compared to the main European countries. It has also contributed to increasing the efficiency and safety of the railway system, especially along the busiest and most saturated routes; to improve the accessibility of large urban nodes, also increasing competitiveness with respect to other means of transport. These positive results, partially confirmed in the two-year period 2009-2010 with the entry into service of 193 km10 of new HS/HC lines, as highlighted in the 2010 Study, could be at risk if the absence of new works also recorded in 2011. Specifically, in 2009 no less than 143 km of new HS/HC lines were launched, well above the average annual trend we estimated at about 13 km. This resulted in a BAF of €2009 billion, including an extra-BAF of €2011 billion. However, 53, with 10,3 km of new lines, presents a BAF of €6,3 billion (Figure 2010) compared with a CNAF of just €50 billion. In 3,6, on the other hand, inertia resulted in CNAF amounting to €14 billion0,4. Overall, therefore, the null constructions of 2011 are more than compensated by the construction of works in a much higher number than envisaged by the Policy in 4,1 and partly by those of 11, resulting in a BAF of €2011 billion over the three-year period, of which €2009 billion extra-BAF.
The conventional railways
The conventional railways, while showing a positive 2009, thanks to 54 km of new lines, show a slowdown in the two-year period 2010-2011, with the opening of 68 km of sections, below the requirement for the period equal to 88 km. Overall, the achievements of the three-year period 2009-2011 generated a cumulative BAF of €13,4 billion. This contrasts with a cumulative CNAF of €3,9 billion essentially due to lower constructions in the two-year period 2010-2011 (Figure 14). In detail, 2009 was the year with the best results. In fact, the 54 km of conventional lines, involving both new lines and capacity expansions of existing networks, are above the objectives of (Figure 14 – High Speed/High Capacity Railways: CNF performance and achievements in the three-year period 2009-2011 ) Established annual policies; this generated a BAF of no less than €6,9 billion, including an extra-BAF of €1,1 billion. In 2010 the positive trend of constructions continued, even if to a lesser extent than in 2009. The 36 km of urban nodes upgrading, in fact, generate a BAF of € 3,4 billion. However, the failure to meet the annual infrastructure requirement results in a CNAF of €2,3 billion. 2011 is the year in which activations are lower: 32 km, below the requirement for the period. Therefore, against a BAF of €3,1 billion, there is a CNAF of €2,7 billion. Overall, therefore, the slowdown in the two-year period 2010-2011 compromises the positive trend of the first year, reducing its benefits.
Conclusion
The HS/HC railway lines are a great opportunity to relaunch rail transport not only for long distances, but also for goods and for regional movements and in metropolitan areas. For this it is necessary to complete the HS/HC design and to intervene on the railway infrastructure system as a whole. This is also implemented through the enhancement of services, the modernization of the rolling stock, investments in technologies that make it possible to make the entire network more efficient, as well as through the redefinition of the role of the stations as a crucial aggregation center from a socio-economic point of view and interchange pole in the area. Figure 15 - Conventional railways: CNF trend and constructions in the three-year period 2009-2011
The water sector
The water sector in the three-year period 2009-2011
There is a widespread awareness that the reform of the water sector, despite the application of the Galli Law, is still largely incomplete. The most critical aspect is the structural incapacity for modernization at least in a substantial part of the national territory. Inadequate investments have repercussions on the efficiency of the networks and the service as well as, a point which will soon become of great importance, on compliance with the Community obligations regarding purification and water discharges. The tariffs, among the lowest in Europe, and the results of the referendum for the part on the return on invested capital, make the financing of investments with resources other than non-repayable public resources extremely complex. These critical issues are confirmed by the progress of constructions in the three-year period 2009-2011. As shown in Figure 16, the replacement of aqueduct networks is scarce, of around 3.000 km, and the adaptation of the purification plants is insufficient, with an increase of 1.000.000 population equivalents (PE) served. This resulted in a CNAF of €4,2 billion and a BAF of just €1,2 billion. The negative trend concerns all the years considered. It should be emphasized that, given the limited availability of data, for the estimate of the achievements we started from the analysis of the investments of some of the companies12 operating in the Integrated Water Sector (SII) in different areas of the country (North, South and Islands) projecting the data entire population13. The values thus determined were compared with the average annual requirement equal to 3.365 km for the aqueducts, and 500.000 PE for the purifiers. Even today, against a very large penetration of the aqueducts (over 96%), the sewage system covers only 86% of the needs and purification stops at 70%. It appears clear that the impasse can only be overcome through an overall reorganization of the sector and with sufficiently large resources for investments, as insiders have repeatedly reiterated. According to the BlueBook 201114, in fact, over the next thirty years more than €65 billion will be needed for investments; these resources will have to be allocated, mainly, to sewerage and purification interventions also in order to comply with European standards on water discharges and thus avoid heavy penalties. Figure 16 – The water sector: the trend of CNFs in the three-year period 2009
The aqueducts
The aqueduct networks in the three-year period 2009-2011 present a less than positive implementation framework. According to our estimates, 800 km, 1.700 km and 580 km of the network have been replaced respectively in recent years. These values are well below the Policy objectives for 2024 which indicate the annual infrastructural replacement requirement at approximately 3.300 km. As shown in Figure 17, the low growth resulted in a BAF of just €936 million against a very high CNAF of €4 billion. In 2009, the 800 km of aqueduct network replaced involved CNAF for €1,4 billion and BAF for €290 million. Also 2010 shows not encouraging results, albeit slightly higher, due to the greater number of km of network replaced and equal to 1.700. The BAF, therefore, is €400 million, while the CNAF amounts to €1,2 billion. In 2011, the forecasts, in line with the results of 2009, show scarce realizations, estimated at 580 km, generating a CNAF of €1,4 billion, against a BAF of only €240 million.
The purifiers
The country, especially in some areas, has been suffering for some time from serious deficiencies in the purification system which have led to numerous complaints from the EU over the years for the violation of the directives on the treatment of waste water15; today there is a looming risk of incurring significant Community sanctions. In the three-year period 2009-2011 (Figure 18), in the face of some progress due to bringing existing plants up to standard (capable of serving around one million PE), overall there was insufficient development to fill the infrastructural requirement by 2024. Thus it emerges a BAF of €292 million to which non-construction costs, CNAF, for €172 million correspond. We would like to underline that these results must be read with caution for two reasons. First of all because the estimation method could generalize a situation which, in reality, is more complex and varied: alongside virtuous contexts, such as Piedmont, Veneto or Emilia-Romagna, there are others that can be defined, metaphorically speaking, as disastrous where the coverage is just over 50%. Secondly, the Policy scenarios are certainly ambitious: the aim is for a coverage of 85% of the population which must be achieved by 2024 by the service in question.
Conclusions
To accelerate the development of the networks and improve the efficiency of the service, it is important to reiterate the points of the 2010 Study: a serious reform of the sector that overcomes the numerous uncertainties increased by the referendum results; the establishment of an independent Authority, with characteristics similar to that of gas and electricity, which establishes general rules valid for the whole country; the mobilization of resources for infrastructures that make everyone's right to access water and protect the environment effective. Furthermore, it is absolutely necessary to invest in the completion of the purification and sewage networks, which are closely connected to each other. To this end, the removal of existing obstacles to the financing of works is an essential priority. Figure 18 – Purifiers: the trend of the CNF and the realizations in the three-year period 2009-2011
The standardized procedure
Last year, with a view to overcoming the obstacles to infrastructure construction, we carefully examined the procedural criticalities on the basis of the most qualified and recent literature. This has allowed us to develop a model aimed at facilitating the approval processes of the works, optimizing the times and quality of the choices. It is a Standardized Procedure which provides for clear and articulated methods of development of the work and which allows for the processing of all the information useful for the PA in order to make rational, accepted and, as far as possible, definitive decisions avoiding the repetition of the procedures . This model is: • Structured, it highlights typical and critical phases and decision-making moments; • Optimizing, it allows to make well-founded, aware and correct decisions; • Stable, leaves no room, except in extreme cases, for the decisions taken to be reviewed; • Progressive, determines the growth of the resources employed in the evaluation/planning as the validity and acceptability of the initiative are verified. • Participated, involves all subjects directly or indirectly interested in the creation of the infrastructure through democratic instruments of concertation. Figure 19 – The standardized procedural process
The analysis of the cases
In order to test the Standardized Procedure model, we have reconstructed the history of a series of cases of infrastructures characterized by particularly problematic authorization procedures. In all the cases analysed, the presence of multiple hindrance factors increased the times and costs of carrying out the work beyond measure. In the study, therefore, in addition to identifying the authorization critical issues with regard to their different nature, we hypothesized solutions borrowing them from the model described. The analysis of the cases has allowed us to identify the 10 most relevant issues with respect to which we have developed the guidelines for a draft law aimed at relaunching infrastructural construction in our country. Figure 20 summarizes the critical issues that have emerged, their importance for the individual infrastructures (greater as the red dots increase) and the proposals to overcome them. The works represent the sectors studied by the Observatory and are: • The Porto Empedocle regasification terminal • The Pontremoli railway • The Tyrrhenian motorway • The wastewater purification system • The Gioia Tauro waste-to-energy plant • The Badana lake dam. Figure 20 – The standardized procedural iter: the analysis of the cases
What, in a nutshell, are the key points? In the first place, the regulatory issues present in all the cases analyzed which are at the origin of many of the other problems encountered. Lack of clarity, low effectiveness and even errors are the findings most often raised. The financial constraints, common to the logistics and environmental sectors, where public resources are essential, are also very important. In these cases, the public finance crisis and the scarce spending capacity of local authorities, due to the stability pact, have undermined the implementation processes. In many of the cases analysed, long times are complained of for the issue of authorizations by local authorities and central administrations; the lack of peremptory times and sanctions against the defaulting parties can be accompanied by obstructive behaviour. Furthermore, delays in authorizations often derive from the numerous requests for integration and project revision. This is also due to the scarce attention dedicated to planning and design and to the modest involvement of the PA in the upstream phases. Often, therefore, the ineffective structuring of the procedural iter is very important since it slows down, if not blocks, the achievements. This frequently entails the need to restart the process, retracing phases that are theoretically already completed. Regarding the Nimby issue, the analysis confirms its relevance, even if it does not appear to be the main cause of the blockages. The oppositions of the stakeholders generate delays in the realization of the works and very often cause indecisionism or opportunism of the political system at local and national level. The issue of compensatory measures does not seem to be crucial even if in some cases it strongly affects the overall costs to the point of jeopardizing the economic equilibrium. Furthermore, too frequently local administrations subordinate the issue of authorizations to the negotiation of these measures, also influencing the implementation times. Technical issues are rarely the cause of obstacles. This even if, especially in linear works, one often has to face technical criticalities due to the complexity of the territory and, in part, to the lack of attention dedicated to the design. The theme of alternation and political uncertainty is linked to the changes in national and local governments. The slowdowns derive from the need to re-credit the work with the new administrators. Disputes between the different levels of government are much more frequent than arises in cases. They are transversal to all sectors and also arise from the constitutional provision of the competing competences of the State and the Regions in the matter of building energy, road and environmental infrastructures.
The Porto Empedocle regasification terminal
The project concerns the construction by Enel of an 8 G(m3) LNG regasification terminal in the municipality of Porto Empedocle. The authorization process covered a total of 7 years; during this period, the originally planned construction costs increased from €600 million in 2004 to €850 million in 2011.
History
The construction process of the Porto Empedocle regasification terminal began in July 2004 with the request for authorization from the Sicily Region. In October 2004, the EIA procedure began and environmental and safety clearances were requested. In June 2005 the first Feasibility Authorization (NOF) was received from the Region. In March 2006, the EIA Commission favorably assessed the land-based works and made observations for the sea-based works. In October of the same year, Enel, implementing the indications, presented a design adaptation. In December 2006, the Ministry of the Environment (MATTM) asked for new insights and additions. In March 2008, the Ministry for Cultural Heritage (MiBAC) issued a favorable opinion. In April 2008, the EIA Commission issued a favorable opinion but with prescriptions. Finally, in September 2008, the Environmental Compatibility Decree of the MATTM and the MiBAC was released. In January 2009, the Sicily Region issued a final favorable opinion, but only in October 2009, having reached an agreement on the compensatory measures, did it issue the Decree authorizing construction and operation. Everything seemed ready to go but in January 2010 the Municipality of Agrigento, the Chamber of Commerce of Agrigento, Legambiente and Codacons filed appeals to cancel the VIA Decree, accepted by the Tar of Lazio which canceled all the authorisations. In July 2011, the positive outcome of Enel's appeal to the Council of State made the authorization decree effective again.
Criticalities
• Long lead times for authorisations: complexity and duration of the process • Numerous requests for additions: the MATTM requests supplementary information and new assessments three times • Lack of clarity and unambiguity of the procedures for the authorization process • Subsequent objections to the authorisation: appeals to the administrative courts and the Council of State. • Compensatory measures: authorization decree of the Region “subordinated” to the agreement on compensatory measures; strong impact of the measures on the overall cost of the work.
The proposals
• Centralization of authorizations in a single moment • Certainty of timing • Greater attention to the planning phase • Introduction of public debate • Limitation of appeals to administrative courts • Limitation of compensatory measures.
The Pontremoli railway
The project to upgrade the Pontremolese, the freight transport railway line between La Spezia and Bologna-Milan near Parma, concerns the completion of the doubling of the line, for a total length of 60 km in the Parma-La Spezia section. The estimated cost is €2,3 billion.
History
The start-up can be placed in December 2001, when the work was included in the Strategic Infrastructure Programme16. In June 2003, Rete Ferroviaria Italiana (RFI) sent the preliminary project (PP) to the Ministry of Infrastructures (MIT), starting the EIA procedure. Subsequently, the regions involved (Liguria, Emilia-Romagna and Tuscany) and the local authorities express a positive opinion with prescriptions regarding environmental compatibility. In July 2005, the EIA commission gave a favorable opinion. In December 2007 the Cipe approved, with prescriptions and recommendations, the PP with a total cost of the work of €2,3 billion. In July 2008, the Court of Auditors refused approval for the registration of the CIPE resolution. In 2009, the MIT, in order to overcome the problems raised by the Court of Auditors, identified a first functional lot and requested the immediate allocation of resources for €0,2 billion; in this way it was possible to submit the intervention to the Cipe again. Again in 2009, the Cipe approved the preliminary project for the work, assigning an initial loan of around €0,3 billion. The end of the works is expected by 2021 provided that the financial resources are found.
Criticalities
• Difficult to find resources for complex works and with a significant financial impact on the amounts allocated to the conventional network • Partial allocations of resources, for example for the design, but not for the construction of the work • Cost variation due to new requirements • Uncertainty about how to finance the EIA requirements • Court of Auditors holding back on the allocation of resources for planning • Difficulty in carrying out the interventions on the Tuscan and Emilia-Romagna sides and complexity of the Valico Tunnel project • Particular and complex characteristics of the lines freight transport • Long lead times for EIA authorizations and lengthening of implementation times • Cipe-Corte Conti dispute.
The proposals
• Greater attention to the planning and resource programming phase • Certainty in the allocation of financial resources • Greater attention to the planning phase of the works • Centralization of authorizations in a single moment • Introduction of the Public Debate in the French style • Definition of peremptory times for authorizations .
The A12 Rosignano-Civitavecchia
The Government, the Tuscany Region and local authorities have been discussing the project for the A12 Rosignano-Civitavecchia motorway, known as Tirrenica, for over 40 years, given the importance of the work for the development of local and national traffic. The motorway, which overlaps the Aurelia, is 206 km long and is divided into two sections, North and South; the connection between two existing sections is envisaged: the Rome-Civitavecchia and the Genoa-Rosignano. The estimated cost is approximately €2 billion17.
History
In December 2001, the Tirrenica was included as a strategic work in the Objective Law. In 2005, the Società Autostrada Tirrenica (SAT), concessionaire of the work, presented the PP and the Environmental Impact Study (SIA). In 2006 the EIA commission expressed a favorable opinion, with prescriptions, and in December 2008 the PP was approved by the CIPE. In December 2009, the first lot was started in the Rosignano-Cecina section (4,5 km). In July 2010, the Cipe, at the request of the Ministry of Finance, asked SAT to develop a new economic and financial plan, with the aim of not burdening state public spending. Following this, in December 2010 an agreement was signed between MIT, SAT, the Tuscany Region, the Province of Livorno and the Municipality of Piombino for substantial changes to the PP that had been approved by the CIPE in 2008. In May 2011, the CIPE approved the Definitive Project (PD) of the 14,6 km (Civitavecchia-Tarquinia) whose construction sites were started in October of the same year. In June 2011, Anas gave the definitive green light to the new project. In the same month, the new Barriera di Rosignano and the connection between the Livorno-Rosignano and the Aurelia variant were inaugurated. The project relating to the sections not yet started is currently in the Services Conference (CdS), which will be followed by the investigation by the MIT and the resolution by the Cipe for the definitive start to the construction sites. The entire project is expected to be completed by 2017.
Criticalities
• Various project variants over the years • Excessive onerousness which leads to the revision of the costs of the work (from 3,8 to 2,2 billion €) • Various reiterations of the process • Opposition of the populations on the location of the work • Numerous prescriptions and compensatory works • Too long times for authorizations • Various changes of administrations which cause the blocking of procedures or the recurrence of authorization processes • Critical issues related to the target Law (eg non-peremptory times for authorisations).
The proposals
• Attention to planning of interventions and rationalization of expenditure • Introduction of public debate • Centralization of authorizations in a single moment • Invest more and better in planning • Regulation of compensatory measures.
The wastewater purification system
The reflections that follow derive from the analysis of a "generic case" where, however, the real authorization process is retraced, highlighting the critical points.
History
The construction of purification plants is always anticipated by a "preliminary" phase of conception and planning; this phase (The Area Plan - PdA) includes the entire design of the works (purifiers, sewage systems, aqueducts, etc.) to be built, completed or improved in a specific area. This is part of the investment program aimed at making the SII efficient and of high quality. This planning activity takes the form of the signing of Framework Program Agreements and subsequent supplementary deeds to define methods and sources of public funding for the PdA and the approval of the POT (Three-Year Operational Plan). The drafting of the Preliminary Planning Document (DPP) then begins and the subsequent assignment of the Planning assignment, which initiates the PP. During the PP there is a request for a preliminary opinion to verify the archaeological interest, the subjectability to the EIA and the initiation of the expropriation procedure. The CdS is only possible. The processing of the PD is accompanied by the request for authorizations such as, for example, the verification of subjection to the EIA or building permits and town planning compliance. Also during this phase the CdS is possible. With the approval of the PD/PE, the spending commitment is acquired by the funding body for the financial coverage of the project by means of public contributions and/or tariff income. This is followed by the tendering of the projects and the consequent construction.
Criticalities
• MC only possible • Lack of peremptory reference time limits • Lack of involvement of local authorities, not always involved from the initial stages • Difficulty in developing sharing on the objectives to be achieved and on the projects to be implemented • Probable increase in planned investments • Prevalence of partial and conflicting visions of the project • Method of carrying out the EIA: only on the PD and preliminary opinion during the PP, with the risk of revision of the project.
The proposals
• Make the CdS mandatory by extending the principle of tacit consent also to environmental authorizations • Introduction of the public debate in the French style • Centralization of authorizations in a single moment • Definition of peremptory times for authorizations • Greater accuracy in the economic-financial analysis • Simultaneous approval of the project and release of authorizations for the execution of the work.
The Gioia Tauro waste-to-energy plant
The case concerns a waste-to-energy plant capable of treating 120 kton/year of RDF and 30 kton/year of special waste. The plant should be built near Gioia Tauro; the authorisation/construction process has been underway since 2000 and the planned investment is €73 million.
History
In February 2003, the expansion of the Gioia Tauro waste-to-energy plant was planned through the construction of a second furnace to receive the waste from the Calabria Nord and Centro18 basins by the company TEC19. In 2004, following the favorable opinion for the construction of the plant from the Superintendency for Architectural Heritage and the Commissioner delegate of the Calabria Region, the EIA procedure began. In March 2005, the EIA Commission also expressed a favorable opinion with provisions incorporated in the executive project, but not in the contract. From here on, the works are continuously interrupted due to a series of events: in 2005, the Calabria Region with lr orders the suspension of the works; this law is then declared illegitimate by the Constitutional Court. In 2007, TEC suspended the works due to the lack of a financing agreement due to problems in the disbursement of the public contribution and in the payments of the current management. Still in 2007, the Region with the Regional Law again orders the suspension of the works; the lr is once again declared illegitimate by the Constitutional Court. In November 2011, the plant was under construction: the changes prescribed by the Superintendency and the VIA Commission in 2005 still have to be contractually implemented. It is not known when the plant will be finished.
Criticalities
• Local opposition to the construction of the plant • Inefficient process structure and problems of contractualisation of the variants • Obstructive behavior by the PA20 • Lack of peremptory times for authorizations • Political alternation in the administrations involved21 • Slowdowns due to the negotiation of Compensatory Measures • Critical issues related to both national and regional regulatory changes.
The proposals
• Revision of the procedural process by postponing the tender after the approval of the final project by the EIA commission • Provide certain and peremptory times for the issue of authorizations by introducing the formula of silent consent • Introduction of public debate to overcome local opposition • Greater attention to the planning phase involving public administrations already in the planning phase to limit the request for additions and variations • Regulation and limitation of compensatory measures. The Gioia Tauro 30 waste-to-energy plant.
The Badana Lake Dam
The project concerns the works to restore the safety and functionality of the Badana dam, about 50 meters high, after its deactivation following the damage suffered by the plant in February 2006. The dam is currently empty. The Badana dam, in service since 1914, is included in the water system of the Gorzente lakes, an important source of drinking water for the city of Genoa, managed under concession by Mediterranea delle Acque (MdA)
History
In 2006, having ascertained the risks, the dam was emptied and already in 2007 the first project proposal was launched which envisaged maintenance and not reconstruction works above all for reasons of environmental impact. In 2009, Mediterranea delle Acque presented the SIA and the project documents to the Environment Department of the Piedmont Region. Shortly afterwards, the EIA procedure under state jurisdiction begins, including an impact assessment since the work and the access road fall within a Site of Community Importance (SIC). Following the first two sessions of the CdS (July 29 and September 3, 2009), some design and environmental aspects are requested to be examined in depth. Against this, the proposer requests the MATTM to suspend the procedure, to prepare the appropriate additions. In December 2009, the final project was approved by MIT, the Directorate General for Dams, and sent to Section IV of the Superior Council of Public Works (CSLP). In 2010, the fulfilments required by the competent Directorate General of the MATTM for the restart of the EIA procedure and for the consequent reactivation of the regional investigation were completed; the third session of the CdS also takes place, in which the integrations produced by the proposer are examined. At the end of 2010, the CSLP blocked the project for various reasons. Again, it is not known when the work will be completed.
Criticalities
• Lack of clear indications on the implementation of the project • The CSLP has not clarified which interventions should be capable of guaranteeing the approval of the final project. • Recurrence of the procedure • Increase in costs • Problem of the environmental compatibility of the dam maintenance works • Local oppositions • Lack of peremptory times for the release of authorizations (and possible sanctions).
The proposals
• Greater attention to the planning phase • Certainty of timing • Greater attention to the planning and resource programming phase • Centralization of authorizations in a single moment • Introduction of public debate for the involvement of all stakeholders.
The guidelines for a framework law on infrastructure
The case study shows how certain problems more than others block or slow down the construction of infrastructures. Starting from this analysis, integrated by the wider knowledge of the problems as well as by the opinion of the Observatory's partners, we have elaborated 10 proposals; thanks also to the collaboration of the Parliamentary Intergroup on “The Costs of Not Doing”22, they constitute guidelines for a possible bill for the revitalization of infrastructures. This proposal rests on four pillars: a careful choice of priority works capable of generating significant benefits for the country; the redefinition of the procedural procedures to simplify and speed up the implementation; the formulation of more democratic choices, open to the participation of all stakeholders and citizens in particular; innovation in the collection and use of financial resources. The proposal starts from a redefinition of the competences of the different levels of government, restricts and qualifies the concept of strategic work, reorganizes the procedural processes and identifies the key elements of the process itself. It is divided into ten points: 1. Clear distinction, through a partial and targeted constitutional reform, of the competences of the State, Regions and local bodies, to avoid the continuous conflict between the levels of government involved; attribution of exclusive competence to the State for strategic infrastructures of national interest. 2. Identification of strategic works on the basis of a rigorous Cost-Benefit Analysis (Figure 21 – Outline of the framework law proposal) which demonstrates the effective capacity of the work to generate positive impacts for the country and for the territories that host it. 3. Provision of a Direction and Control Structure appointed together with the declaration of strategic nature of the work and which has the task of monitoring the authorisation/implementation procedure in order to facilitate and speed up the process. Furthermore, it performs guidance and coordination, advisory and sanctioning functions and can adopt certain acts in the event of inaction by the PA. 4. Definition, always contextual to the declaration of strategic importance, of the procedure for the Definitive Authorization which clarifies and simplifies the procedures in force. It is made up of a maximum of three phases at the end of which a single decision-maker has the burden of approving or blocking the implementation. 5. Definition of Program Agreements for strategic infrastructures (AdPS) in order to give binding effect to the decisions taken by the PAs and to the agreements reached by them with the proposing subject. The AdPS must be implemented by the CdS in the same way as favorable opinions issued in this area by the Administrations that signed them. 6. Introduction of the French-style Public Debate, a formalized and exhaustive moment of discussion on the work involving all stakeholders and which will have the purpose of informing the administrations, businesses and citizens of the area on all aspects concerning the work, but also to inform the proposer of the main critical issues related to the consent. The Debate must be coordinated by an independent and authoritative body that is able to guarantee the protection of all the parties involved. 7. Introduction of tools for regulating compensatory measures which, on the one hand, limit the increase in the costs of the works and, on the other, guarantee effective compensation to the populations following the subtraction of availability of the territory on which the work stands. Promote measures that activate the development of the territory. 8. Creation of a preferential judicial channel for the resolution of disputes relating to strategic infrastructures, reducing the time for disputes and entrusting the matter to specialized judicial bodies, in the context of administrative justice. 9. Introduction of innovative tools for financing works to overcome the problems of unattractiveness for private resources and constraints on public resources. In particular: implementation of the “Eurovignette” directive; creation of a fund for cross-modal financing; introduction of value capture tools. 10.
Attachments: CNF 2011 – Summary of results.pdf
