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A C I L A L L E N C O N S U L T I N G

SEPTEMBER 2013

OPTIONS FOR GLEBE ISLAND BRIDGE BRIDGE

COST BENEFIT ANALYSIS OF VARIOUS OPTIONS FOR GLEBE ISLAND BRIDGE

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ii

C o n t e n t s 1 Introduction 1

1.1 Context 1

1.2 Study objective and scope 2

1.3 Study approach 3

1.3.1 Desktop review 3

1.3.2 Stakeholder consultations 3

1.3.3 Cost-benefit analysis methodology 4

1.4 Report structure 4

2 Background 5

2.1 Glebe Island Bridge 5

2.1.1 Overview 5

2.1.2 Bridge design 5

2.1.3 Current condition of the bridge 6

2.1.4 Heritage significance 7

2.2 The Bays Precinct 8

2.2.2 Vessel movements through the Glebe Island Bridge channel 10

3 Options development 12

3.1 Long list of options 12

3.1.1 Preservation / restoration 13

3.1.2 Demolition 14

3.1.3 Replacement 17

3.2 Shortlisted options 18

4 Assessment of costs 20

4.1 Capital costs 20

4.1.1 Base Case 20

4.1.2 Full Demolition 20

4.1.3 Restoration 21

4.2 Recurrent costs 22

4.2.1 Base Case 22

4.2.1 Full Demolition 23

4.2.2 Restoration 23

4.3 Costs to NSW Government 25

5 Assessment of benefits 26


iii

5.1 Full demolition option benefits 26

5.1.1 Avoided maintenance costs 26

5.1.2 Safety benefits 26

5.1.3 Time savings of maritime operators 28

5.2 Restoration option benefits 29

5.2.1 Avoided maintenance costs 29

5.2.2 Delays for vessel operators 29

5.2.3 Time savings of commuters 30

5.2.4 Amenity benefits 31

5.2.5 Heritage value 31

5.2.6 Option value for future light rail 32

5.2.7 Benefits for visitors to the Sydney Exhibition Centre @ Glebe Island 32

5.2.8 Residual value 33

6 Cost-benefit analysis results 34

6.1 Full Demolition option 34

6.1.1 Present value of incremental costs 34

6.1.2 Present value of incremental benefits 34

6.1.3 Net present value 34

6.1.4 Benefit-cost ratio 34

6.2 Restoration option 35

6.2.1 Present value of incremental costs 35

6.2.2 Present value of incremental benefits 35

6.3 Sensitivity analysis 36

6.3.1 Full Demolition option 36

6.3.2 Restoration option 37

6.4 Conclusion 38

List of figures

Figure 1 The Bays Precinct 1

Figure 2 Glebe Island Bridge (2012) 5

Figure 3 Glebe Island Bridge elevation 6

Figure 4 Aerial view of the Bays Precinct 8

Figure 6 Preservation – option 3 14

Figure 7 Replacement – option 1 17

Figure 8 Replacement – option 2 18

Figure 9 Avoided maintenance costs of Full Demolition option, Year 1 to Year 30 (2013 dollars) 26


iv

Figure 10 Avoided maintenance costs of Restoration option, Year 1 to Year 30 (2013 dollars) 29

List of tables

Table ES 1 Long list of options considered for Glebe Island Bridge vi

Table ES 2 Present value of benefits of Full Demolition option, 2013 dollars ix

Table ES 3 Present value of quantifiable benefits of Restoration option, 2013 dollars x

Table ES 4 NPV of quantifiable benefits of Restoration option and difference in NPV between Restoration and Full Demolition options, 2013 dollars x

Table ES 5 Required heritage and amenity benefits for Restoration to be preferred option – 7% real discount rate, 2013 dollars xi

Table 1 Maritime businesses in Rozelle and Blackwattle Bays 10

Table 2 Vessel movements data 11

Table 3 Long list of options considered for cost-benefit analysis 12

Table 4 Preservation - option 2 13

Table 5 Works required for each demolition option 15

Table 6 Demolition – option 1 15




Table 10 Capital cost of Base Case 20

Table 11 Capital cost of Full Demolition option 21

Table 12 Capital cost of Restoration option 21

Table 13 Recurrent costs under the Base Case, Year 1 to Year 30 23

Table 15 Total costs to Government over 30-year analysis period, bt option (2013 dollars) 25

Table 16 Assumptions used in estimating safety benefits of the Full Demolition option 27

Table 17 Assumptions used in estimating maritime timesavings of the Full Demolition option 28

Table 18 Assumptions used in estimating commuter time savings under the Restoration option 30

Table 19 Present value of benefits of Full Demolition option, 2013 dollars 34

Table 20 Present value of quantifiable benefits of Restoration option, 2013 dollars 35


v

Table 21 NPV of quantifiable benefits of Restoration option and difference in NPV between Restoration and Full Demolition options, 2013 dollars 35

Table 22 Required heritage and amenity benefits for Restoration to be preferred option – 7% real discount rate, 2013 dollars 36


Cost Benefit Analysis of various options for glebe island bridge vi

Executive summary

ACIL Allen Consulting (ACIL Allen) was commissioned by Transport for NSW to

undertake a cost-benefit analysis of options for the Glebe Island Bridge in Sydney.

Opened in 1903, the Glebe Island Bridge was an electrically operated swing bridge

which connected Rozelle to Pyrmont by road. The Bridge was closed in 1995, when

the adjacent Anzac Bridge opened, and remains in a permanently open position with

no access to pedestrians or vehicular traffic.

A 2009 structural assessment found the Bridge to be in very poor condition, and it

has since deteriorated further with the wooden access platform under the western

span of the Bridge collapsing in January 2012. It is one of the few remaining swing

bridges of its type in Australia and in the world.

Options development

ACIL Allen considered three broad categories of options for the Bridge:

restoration / preservation

removal / demolition

replacement / adaptation.

Within each category there were a number of options (see Table ES 1).

TABLE ES 1 LONG LIST OF OPTIONS CONSIDERED FOR GLEBE ISLAND BRIDGE

Category Option Description Cost

Preservation / restoration

Option 1 Minimal repairs to ensure boating safety * $12.0 million

Option 2 Restoration of the bridge for two lanes of traffic on the bridge $37.5 million

Option 3 Restoration of central bridge for safety purposes, removal of abutments

Not costed

Removal / demolition

Option 1 Demolish swing span superstructure only ** $39.3 million

Option 2 Demolish swing span and central stone pier to bed level ** $43.9 million

Option 3 Demolish swing span, approach spans and all 3 piers ** $37.3 million

Option 4 Demolish swing span, approach spans and all 3 piers, as well as removal of approach embankments

$40.2 million

Replacement / adaptation

Option 1 Replacement of bridge with pedestrian footbridge Not costed

Option 2 Replacement of bridge with modern swing span mechanism Not costed

Option 3 Replacement of bridge with light rail capability Not costed

NOTE: * ALLOWS FOR A MAINTENANCE LOAD OF 2.0KPA AND/OR A MEDIUM SIZE VEHICLE UP TO 9 TONNES ON THE BRIDGE

** FOR SAFETY REASONS, REMOVAL/DEMOLITION OPTIONS INCLUDE THE RESTORATION OF THE REMAINING INFRASTRUCTURE

NOT DEMOLISHED, SUCH AS: RESTORATION OF THE EXISTING TIMBER FENDERS, RESTORATION OF STEEL BRIDGE APPROACHES

AND SPANS WHERE APPLICABLE, AND RESTORATION OF SANDSTONE ABUTMENTS AND THE CENTRAL PIER WHERE APPLICABLE

SOURCE: RMS

The shortlisted options for this cost-benefit analysis are:


Cost Benefit Analysis of various options for glebe island bridge vii

Base Case – Preservation / Restoration Option 1

Full Demolition – Demolition Option 4

Restoration – Preservation / Restoration Option 2.

Preservation / Restoration Option 3 was eliminated as it does not preserve the

integrity of the original Bridge design and therefore confers only partial heritage

value to the preserved structure. It also does not restore the functionality of the

original Bridge.

The replacement options were eliminated because they provide similar transport

functionality as Preservation / Restoration Option 2 without the heritage benefits of

that option.

Among the demolition options, Option 3 was shortlisted because it enables the

channel to be widened relative to Options 1 and 2 (thereby improving the transit of

boats through the channel and reducing the likelihood of an accident), while costing

less than Option 4 (which would have widened the channel even more).

It should also be noted that demolition options do not preclude the addition of

replacement/adaptation options at a later point.

Costs of shortlisted options

Capital costs

The capital costs of the shortlisted options in 2013 dollars are:

Base Case: $12.013 million

Full Demolition option: $37.303 million

Restoration option: $37.517 million.

The incremental capital costs of the Full Demolition and Restoration options are

therefore $25.290 million and $25.504 million in 2013 dollars respectively.

Recurrent costs

The year-by-year total recurrent costs of the Base Case and the Restoration option

over the 30-year analysis period are shown in Figure ES 1. It is assumed that

recurrent costs are zero in the Demolition option.


Cost Benefit Analysis of various options for glebe island bridge

viii

FIGURE ES 1RECURRENT COSTS OF BASE CASE AND RESTORATION OPTION, YEAR 1 TO YEAR 30

SOURCE: ACIL ALLEN

Benefits of shortlisted options

The cost-benefit analysis involved identifying, quantifying and valuing the benefits

associated with each of the shortlisted options and comparing them to the capital

and recurrent costs of the options.

However, some of the benefits are very difficult to quantify and precisely place a

value on, in particular the amenity and heritage benefits of the Restoration option.

An alternative strategy was adopted to address this challenge, as outlined below.

Full Demolition option

The following benefits were quantified for the Full Demolition option:

avoided maintenance costs

safety benefits from reduced risks of collision between vessels and the Bridge

time savings of vessel operators as a result of the widened channel.

According to records held by Transport for NSW, in the period 1992/93 to 2012/13

there has been 11 reported boating incidents in the immediate vicinity of Glebe

Island Bridge. These 11 incidents comprised one fatal incident and 10 non-injury

incidents. Transport for NSW estimates that the number of accidents would

decrease by at least 50 per cent after the demolition of the Bridge.

Information obtained from ACIL Allen’s survey of maritime businesses in Rozelle

and Blackwattle Bays suggests that: 78 per cent of trips through the channel are for

businesses rather than leisure; there are 4.8 passengers per vessel on average; and

the average time saving per vessel enabled by full demolition of the Bridge would be

10.0 minutes. RMS estimates that, on average, up to 300 vessels currently pass

through the channel each day and that vessel movements are likely to grow by more

than 2 per cent per annum.

$0

$1

$2

$3

$4

$5

$6

$7

$8

$9

$10

1 3 5 7 9 11 13 15 17 19 21 23 25 27 29

Millions

Year

Base Case

Restoration


Cost Benefit Analysis of various options for glebe island bridge ix

Restoration option

The following benefits and costs were quantified for the Restoration option:

reduced maintenance costs relative to the Base Case

time cost of delays to vessel operators

time savings of cyclists and walkers commuting to work between Balmain or East Balmain and Sydney Inner City.

ACIL Allen’s survey of maritime businesses at Blackwattle and Rozelle Bays

indicates that the average delay per vessel is expected to be 14.3 minutes when the

Bridge is primarily closed to maritime traffic and only periodically opened after

restoration.

Based on data by the NSW Bureau of Transport Statistics, there are 229 cyclists

and 101 walkers each work day who could potentially enjoy time savings by

commuting to work over the low-level restored Glebe Island Bridge instead of the

high-level Anzac Bridge. In the cost-benefit analysis, it is assumed that, on average,

cyclists save 5 minutes per trip while walkers save 15 minutes per trip.

The restored Bridge’s heritage benefits and the amenity benefits that will be enjoyed

by recreational walkers and cyclists have not been explicitly quantified in the cost-

benefit analysis. Instead, ACIL Allen has calculated the threshold value that the

community must ascribe to the heritage aspects of the restored Glebe Island Bridge

and to its potential amenity benefits in order for Restoration to be the preferred

option.

Cost-benefit analysis results

Full Demolition option

The present value of benefits associated with the Full Demolition option under three

alternative real discount rates is shown in Table ES 2. The NSW Treasury

recommends 7 per cent as the central case with 4 per cent and 10 per cent as

sensitivities.

TABLE ES 2 PRESENT VALUE OF BENEFITS OF FULL DEMOLITION OPTION, 2013 DOLLARS

4% real discount

rate

7% real discount

rate

10% real discount

rate

Avoided maintenance costs $21.0m $18.1m $16.0m

Safety benefits $4.5m $3.0m $2.2m

Maritime travel time savings $80.0m $54.7m $39.8m

Total benefits $105.5m $75.9m $58.1m

SOURCE: ACIL ALLEN

The net present value (NPV) of the Full Demolition option, calculated by subtracting

the present value of total incremental costs from the present value of total

incremental total benefits, under the alternative real discount rates is:

$80.2 million (4 per cent real discount rate)


$32.8 million (10 per cent real discount rate).


Cost Benefit Analysis of various options for glebe island bridge x

The benefit-cost ratio (BCR) of the Full Demolition option, calculated by dividing the

present value of total incremental benefits by the present value of total incremental

costs, under the alternative real discount rates is:

4.17 (4 per cent real discount rate)


2.30 (10 per cent real discount rate).

Under the central assumption of a 7 per cent real discount rate, the present value of

the benefits of the option is exactly 3 times that of the present value of its costs.

Restoration option

The present value of the quantifiable benefits associated with the Restoration option

under the three alternative real discount rates is shown in Table ES 3. The maritime

travel savings are negative as the restored Bridge will induce delays when vessels

are required to wait for the Bridge to open.

TABLE ES 3 PRESENT VALUE OF QUANTIFIABLE BENEFITS OF RESTORATION OPTION, 2013

DOLLARS

4% real discount

rate

7% real discount

rate

10% real discount

rate


Maritime travel time savings -$114.0m -$78.0m -$56.7m

Commuter time savings for cyclists and walkers

$21.9m $15.2m $11.3m

Residual value $5.0m $2.2m $1.0m

Total quantifiable benefits -$76.5m -$48.9m -$32.8m

SOURCE: ACIL ALLEN

The NPV of the Restoration option, based on quantifiable benefits, under the three

alternative discount rates is shown in the second row of Table ES 4. The difference

in the NPVs of the Restoration and Full Demolition options (based on the

quantifiable benefits of the Restoration option) is shown in the last row of the table.

TABLE ES 4 NPV OF QUANTIFIABLE BENEFITS OF RESTORATION OPTION AND DIFFERENCE IN NPV

BETWEEN RESTORATION AND FULL DEMOLITION OPTIONS, 2013 DOLLARS

4% real discount

rate

7% real discount

rate

10% real discount

rate

NPV of Restoration Option based on quantifiable benefits

-$102.0m -$74.4m -$58.3m

Difference in NPV of Restoration and Full Demolition options based on quantifiable benefits of Restoration option

$182.2m $125.1m $91.1m

SOURCE: ACIL ALLEN

In order for the Restoration option to be preferred over the Full Demolition option,

the yet-to-be quantified heritage and amenity benefits of the restored bridge needs

to be at least $125.1 million in 2013 dollars in present value terms over the 30-year

analysis period under a 7 per cent real discount rate.

Suppose that the unquantified benefits are to be split evenly between heritage and

amenity benefits, each source of benefits would then need to be at least $62.5


Cost Benefit Analysis of various options for glebe island bridge xi

million in present value terms under a 7 per cent real discount rate for Restoration to

emerge as the preferred option (see Table ES 5).

TABLE ES 5 REQUIRED HERITAGE AND AMENITY BENEFITS FOR RESTORATION TO BE PREFERRED

OPTION – 7% REAL DISCOUNT RATE, 2013 DOLLARS

Distribution of required benefits Heritage value PV of amenity benefits

25% heritage benefits: 75% amenity benefits $31.3m $93.8m



SOURCE: ACIL ALLEN

Conclusion

The cost-benefit analysis indicates that Full Demolition of the Glebe Island Bridge

generates a relatively high BCR of approximately 3.0 under a 7 per cent real

discount rate. About a quarter of the benefits of this option are attributable to

maintenance cost savings relative to the Base Case, while nearly three-quarters of

the benefits is due to expected maritime travel time savings from the widened

channel. The BCR is therefore sensitive to the assumed average time saving per

vessel. If the assumed average time saving is halved from 10 minutes to 5 minutes,

the BCR decreases to 1.92.

Restoration of the Glebe Island Bridge generates benefits from reduced

maintenance costs relative to the Base Case as well as commuter time savings for

some of the cyclists and walkers who currently commute to work over the high-level

Anzac Bridge. However, these benefits are only a third of the value of the estimated

time losses that would be experienced by vessel operators when the Bridge is

primarily closed and only periodically opened after restoration.

The heritage value of the restored Bridge and the amenity benefits experienced by

recreational walkers and cyclists have not been explicitly quantified in the cost-

benefit analysis. However, ACIL Allen’s analysis suggests that they have to be at

least $125.1 million in 2013 dollars in present value terms over the 30-year analysis

period (under a 7 per cent real discount rate) in order for Restoration to be the

preferred option.

If these “required” unquantified benefits are to be evenly split between heritage and

amenity benefits, the community must value the heritage aspects of the Glebe Island

Bridge at more than $62.5 million in 2013 dollars and value the amenity benefits to

recreational cyclists and walkers at more than $5.5 million a year. Assuming 1,000

trips are made each day by such cyclists and walkers, the community would have to

value each trip at more than $15.20 in 2013 dollars.


OPTIONS FOR GLEBE ISLAND BRIDGE BRIDGE COST BENEFIT ANALYSIS OF VARIOUS OPTIONS FOR GLEBE ISLAND BRIDGE 1

1 Introduction

ACIL Allen Consulting (ACIL Allen) has been commissioned by Transport for NSW

to undertake a cost-benefit analysis of options for the Glebe Island Bridge in

Sydney.

1.1 Context

The NSW Government is considering options for the future of the Glebe Island

Bridge (the Bridge) as part of its response to the Bays Precinct Taskforce Report

into the future use of the Bays Precinct of Sydney Harbour (the Precinct).

The Bays Precinct comprises the waterways and foreshores of four connected bays

west of Darling Harbour: Johnstons, White, Rozelle, and Blackwattle. This area

spans 94 hectares, as illustrated in Figure 1.

FIGURE 1 THE BAYS PRECINCT

SOURCE: BAYS PRECINCT TASKFORCE 2012

As can be seen in Figure 1, the Glebe Island and ANZAC Bridges divide the precinct

into two zones. Opened in 1903, the Glebe Island Bridge served as the road

connection between Glebe Island and Pyrmont until the opening of the ANZAC

Bridge in 1995.

Currently, the Glebe Island Bridge remains under the ownership of NSW Roads and

Maritime Services (RMS), which is responsible for its operation, management,

maintenance and repair. While the Bridge is listed on the heritage register of the

RMS, it has fallen into disrepair since it ceased operations.



Unlike the ANZAC Bridge, which is a large cable-stayed bridge, engineered to

minimise the restriction of shipping in the Precinct, the Glebe Island Bridge is an

electrically operated swing bridge. When it is in a closed position, road traffic may

pass through, but vessels would be blocked from passing between the southern

bays of the Precinct and the rest of Sydney Harbour.

Since the Glebe Island Bridge was superseded by the ANZAC Bridge, it has been

disused and left permanently in an open position, permitting the free movement of

vessels in the area and allowing the Government to actively promote maritime

developments within Rozelle and Blackwattle Bays. Many of these businesses

depend on being able to safely navigate through the channel at their discretion.

Estimates of the number of vessels that currently pass between the Rozelle and

Blackwattle bays to the rest of Sydney Harbour each day range from 200 to 300

(Hasham, 2013; RMS).

The future of the Glebe Island Bridge is therefore closely tied to the future of the

entire Bays Precinct. Indeed, the Taskforce recommended that the Government

undertake a comprehensive analysis of the costs and benefits of various options for

the Bridge’s future, ranging from removal, to its retention for use as a pedestrian and

bike connection.

Doing nothing is not an option, given the navigational hazards posed by the

deterioration of the Bridge’s condition:

According to the Taskforce report, a 2009 structural assessment found the Bridge to be in “very poor condition”, with further deterioration since then.

A wooden platform under the Bridge’s wooden span collapsed in January 2012 (Hasham, 2013).

A commercial vessel collided with the Bridge in February 2013, resulting in the fatality of a crew member.

However, there are differing views in the community about what the appropriate

course of action should be. Examples of alternatives that have been raised in media

reports (Hasham, 2013) include:

complete demolition

partial demolition, with the abutments left intact

restoration

restoration and conversion into a bridge for pedestrians and cyclists

conversion to support a light rail line.

Each alternative involves different costs and benefits.

1.2 Study objective and scope

The NSW Government has agreed to undertake a comprehensive analysis of the

costs and benefits of retaining versus removing the Bridge, taking into consideration

future transport needs associated with urban renewal scenarios, and current

maritime industry needs, in consultation with relevant Councils and key

stakeholders.

This study:



analyses the costs and benefits of retaining/refurbishing the Bridge, removing the Bridge, or replacing the Bridge

considers the potential uses of the Bridge, including for public transport services, as part of the analysis

considers the views of key stakeholders and community groups

considers the current and potential use of the channels spanned by the Bridge and the dependencies on these channels

makes recommendations on the most appropriate future use of the Bridge based on the analysis.

1.3 Study approach

1.3.1 Desktop review

Prior to undertaking the cost-benefit analysis, ACIL Allen reviewed a range of

documents provided by Transport for NSW, including reports produced by the Bays

Precinct Taskforce.

ACIL Allen also undertook extensive research on Australian and international

studies relating to the valuation of heritage structures and the economic value of

walking trails.

1.3.2 Stakeholder consultations

As part of this study, ACIL Allen consulted with key stakeholders such as:

Transport for NSW

Roads and Maritime Services (RMS)

Bays Precinct Taskforce

City of Sydney

Leichhardt Municipal Council

Heritage Council of New South Wales.

These consultations took the form of face-to-face meetings. In addition, ACIL Allen

surveyed a range of maritime businesses in Rozelle and Blackwattle Bays,

including:

Seawind Catamarans

Blackwattle Bay Marine Ops

Devine Marine

Waterway Constructions

Polaris Marine

Sydney Superyacht Marina

Sydney Heritage Fleet

Sydney Fish Market.

These businesses were asked to estimate the average delay per vessel movement if

the Bridge were to be primarily closed after restoration with only periodic openings,

and the likely time savings per vessel movement if the entire Bridge was to be

demolished.



1.3.3 Cost-benefit analysis methodology

ACIL Allen first developed a long list of options, including different preservation /

restoration options and various demolition options. The less likely options were

progressively eliminated to form a short list of options.

The incremental benefits of the shortlisted options were identified, analysed and

quantified. The present value of the stream of incremental benefits associated with

each shortlisted option was then compared with the present value of the stream of

capital and recurrent costs for that option over a 30-year time horizon under an

appropriate real discount rate.

The results of the cost-benefit analysis are reported in metrics such as the Net

Present Value (NPV, the difference between the present value of total benefits and

the present value of total costs) and the Benefit-Cost Ratio (BCR, the ratio of the

present value of total benefits to the present value of total costs).

Sensitivity analysis was then undertaken to test the robustness of the cost-benefit

analysis results to changes in key assumptions and parameter values.

1.4 Report structure

This report is structured as follows:

Chapter 2 provides a background of the Glebe Island Bridge and the Bays Precinct in which it is located

Chapter 3 presents the initial long list of options and the options shortlisted for the cost-benefit analysis

Chapter 4 assesses the costs of the shortlisted options

Chapter 5 assesses the benefits of the shortlisted options

Chapter 6 presents the key results of the cost-benefit analysis.



2 Background

2.1 Glebe Island Bridge

2.1.1 Overview

The Glebe Island Bridge over Johnstons Bay was constructed from 1899 to 1903

and was removed from service in 1995 after the opening of the Anzac Bridge. The

Bridge is owned by Roads and Maritime Services (RMS), which is responsible for its

operation, management, maintenance and repair. RMS also owns the sea-bed upon

which the Bridge’s piers rest, forming part of the Sydney Harbour Title.

The Glebe Island Bridge and the Anzac Bridge divide the Bays Precinct into two

distinct zones: the port zone at Johnstons and White Bay; and the maritime zone at

Rozelle and Blackwattle Bay. Unique among Sydney Harbour foreshore areas,

almost all the lands are owned by NSW Government authorities, principally the

Sydney Ports Corporation, RMS, Sydney Harbour Foreshore Authority and State

Property Authority.

2.1.2 Bridge design

The Bridge is an electrically operated, low-level, steel swing bridge designed to link

tram and road traffic from the western suburbs of Sydney to the CBD, while allowing

boat traffic to pass between Rozelle and Blackwattle Bay and Sydney Harbour (see

Figure 2).

FIGURE 2 GLEBE ISLAND BRIDGE (2012)

SOURCE: RMS, 2012.



The Bridge is 108 metres long overall and is connected to the land by two artificially

formed abutments (see Figure 3). There are two steel truss spans 24.7 metres long

at either end of the Bridge. The central Swing Span is supported by a massive pivot

pier, founded on a nest of timber piles capped by concrete. The Swing Span can

rotate through 90 degrees to allow the passage of maritime traffic. Underneath the

central span is an inverted arch truss, which varies in depth from 4.3 metres in the

middle to 2.7 metres at the ends (NSW 2012).

The Swing Span is mounted on a steel roller track on the cylindrical stone masonry

and concrete pivot pier 13.9 metres high and 12.9 m wide and is swung by means of

a 600 volt motor. The roadway is 12.2 metres wide and has a 1.5 metre footway on

each side.

The Bridge includes a rare surviving operable Mercury-arc Rectifier, as well as some

early silicon rectifiers, installed in 1960 when the reticulated DC supply was

discontinued (NSW 2012). The Bridge could swing open or closed in 44 seconds,

which was much faster than contemporary bridges in the world at the time of

construction.

When open, the Bridge allows water traffic to flow freely along two waterways, each

18.3 metres wide. At present the Bridge is kept permanently in the open position.

The clearance provided between the centre of the arch truss and high tide mark,

when the bridge is in its ‘closed’ position, is 4.7 metres.

FIGURE 3 GLEBE ISLAND BRIDGE ELEVATION

SOURCE: RMS

2.1.3 Current condition of the bridge

The Glebe Island Bridge operated from 1903 to 1995 with little interruption and few

major works, apart from maintenance, being undertaken. In 1933, the Bridge



underwent an underwater upgrade, with underpinning to replace decayed piles

around the central pier. In 1960, the DC electricity supply from the Tramways

system was shut down, as was the tramway system in Sydney. A new AC supply

was obtained from the local reticulated network and a set of rectifiers was installed

in a small kiosk erected on the north east side of the Bridge. In the 1980s, the

Control Cabin was burnt out and was subsequently rebuilt to the original design.

Since the closing of the Bridge in 1995, it has fallen into disrepair and, despite the

$100,000 per year currently spent on maintenance (BPT, 2012), the structure has

deteriorated to the point where it has become a concern to vessels. The Urbis 2012

report on the state of the Bridge found that:

between 30 and 40% of the structural steel requires replacement or repair

the majority of timber safety fenders have rotted through and snapped

a large proportion of the sandstone piers supporting the Bridge require repair or replacement.

Further, the NSW Heritage Database notes the condition of the Bridge is ‘poor’

(Urbis 2012).

NSW Government agencies have argued that the Bridge poses a navigational risk

by decreasing the sight line of for vessels moving in and out of the Bays. The

Taskforce report also stated that timber fendering bordering both channels is

unlikely to withstand vessel impact and that a minor navigational error resulting in a

collision may also cause a risk to human life and potential for damage or collapse of

elements of the bridge structure.

2.1.4 Heritage significance

Although the Bridge is not listed as an item of significance on the State Heritage

Register under the Heritage Act 1977, the Bridge is listed as a heritage item under a

number of other important policy instruments including:

Heritage Item No. 4301666 s170 RMS

Heritage Item 68 SREP Sydney Harbour Catchment (State Significance)

Heritage item No. 4560015 s170 SPC

It is also considered an important heritage item by the Leichhardt Council, National Estate and National Trust (BPT, 2012 p75).

The NSW Department of Environment and Heritage Statement of Significance

states:

The Glebe Island Bridge, across Johnstons Bay, is likely to be of state significance1 as it

demonstrates one of the earliest examples of an electric-powered swing bridge in Australia.

Technically, it is a complementary structure to the already acclaimed Pyrmont Swing Bridge,

and has all the same significant features, including the electrically-driven swing span. Both

bridges were designed by Percy Allan, a highly-regarded Australian bridge designer of the late

19th and early 20th century. Both represent the only examples of such types of bridges in New

South Wales and are still operable

NSW, 2012, accessed 22/07/2013

1 Italics inserted



Major differences between the Pyrmont Bridge in Darling Harbour and the Glebe

Island Bridge include the fact that the Pyrmont Bridge has a larger swing span than

the Glebe Island Bridge and has more numerous fixed spans of timber than Glebe

Island Bridge, where they are made of steel supplemented by stone causeways

(NSW, 2012).

Determining the heritage value of the Glebe Island Bridge is made more complex by

its similarity to the Pyrmont Bridge. It could be argued that the heritage benefits from

a significant investment in the Glebe Island Bridge are already being provided in a

more densely populated part of Sydney that receives significantly larger numbers of

visitors, hence providing much greater utility/amenity value.

The Heritage Council of NSW is currently considering a request from the National

Trust of Australia to place the Glebe Island Bridge on the NSW State Heritage

Register.

2.2 The Bays Precinct

The Bays Precinct comprises the waterways and foreshores of four connected bays

west of Darling Harbour (Johnstons, White, Rozelle and Blackwattle bays). The

future of the Bridge will have significant economic implications for the Bays Precinct

and the surrounding suburbs, which include Pyrmont, Ultimo, Lilyfield, Annandale,

Balmain, Rozelle, Glebe, Forest Lodge and Leichhardt. The decision will also have

significant implications in terms of potential development options for the Bays

Precinct Area.

An aerial view of the affected area is presented in Figure 4.

FIGURE 4 AERIAL VIEW OF THE BAYS PRECINCT

SOURCE: RMS



The Bays Precinct area has seen significant changes over the past few decades

including the following:

the decommissioning of the White Bay Power Station in 1983

the opening of the Anzac Bridge and decommissioning of the Glebe Island Bridge in 1995

the cessation of operations at the Rozelle Rail Yards in 1997

the cessation of stevedoring operations and container operations in White Bay in 2004, and the opening of a cruise ship passenger terminal in 2013

the cessation of car import operations at Glebe Island and their relocation to Port Kembla in 2008

increased commercial and recreational maritime activities at Rozelle and Blackwattle Bays

an increasing resident population in close proximity to the port

shifting local demographic characteristics (BPT, 2012).

The NSW Government has committed to maintaining the Bays Precinct as a working

port in Government ownership, with land provided for port-dependant industrial and

maritime businesses and activities. According to the Government, opportunities will

be pursued to consolidate industrial activities, freeing up areas for greater public

access and better recreational boating facilities, particularly in Rozelle and

Blackwattle Bays.

Use of the Bridge channel

The Bridge channel is used by recreational vessels as well as by commercial

vessels as part of maritime business operations. Some of the major maritime

businesses operating within the Bays are listed in Table 1.

The area has unique business opportunities due to the close proximity of the Bays to

Sydney CBD. The bay area is also popular with both recreational and commercial

users during public holidays such as Australia Day and New Year’s Eve.

Due to the narrow nature of the channel, additional navigation rules apply to transit

through the Bridge. Vessels must give way to outbound traffic. Vessels must also

navigate through the Eastern Channel, unless directed otherwise by the Sydney

Harbour Master.

The Western Channel is closed to navigation. The channel itself is navigable but has

been closed to avoid interactions between vessels passing through the Bridge and

any vessels that may be berthed at the Glebe Island 1 dock. The Harbour Master

periodically issues directions to maritime vessels in the vicinity of Glebe Island

Bridge, such as altering the navigation channel if bridge maintenance is occurring.

Vessels must give way to the traffic lights installed on the Bridge if they are in

operation. These traffic lights are controlled by Harbour Control (Vessel Traffic

Services) when a large vessel needs to navigate through the channel. Operators of

large vessels can inform Harbour Control of their intended transit. RMS also has a

secondary control unit.



TABLE 1 MARITIME BUSINESSES IN ROZELLE AND BLACKWATTLE BAYS

Business operator Type of business and number of vessel movements per day (where

applicable)

Sydney Superyacht Marina The marina accommodates a large number of yachts, the majority of which are ocean going. There are 10-15vessel movements per day from the Bays to the Harbour.

Sydney Boathouse Dry dock facility, marina and commercial boat mooring. Up to 20 vessel movements per day. The Boathouse has development approval for a 600-vessel dry stack storage, which will lead to increased vessel traffic.

Seawind Catmarans Manufacture, maintenance and berthing of large ocean going catamarans and trimarans. 4-20 movements per day depending on low/peak season.

Sydney City Marine Boat maintenance, repair, refitting business catering for all types of vessels. Up to 10 vessel movements per day.

All Occasion Cruises Marina providing charter vessels for recreational uses.10-30 vessel movements per day from low season to peak periods.

Blackwattle Bay Marine Operatives Business leases the wharf area and provides low level maintenance. 8-14 vessel movements per day (low/peak seasons).

Devine Marine Marine salvage company.

Waterway Constructions Maritime contractor undertaking construction, maintenance and refurbishment of maritime structures.

Polaris Marine Business offers a range of services including salvage, towage, mooring and marine construction services.

Australian Wharf and Bridge Marine contractor undertaking construction, maintenance and refurbishment of maritime structures including wharves, marinas and piers. Vessel movements are unpredictable.

Hanson Construction Materials Receiving and processing point for primary material aggregates for concrete manufacture.

Hymix Australia Concrete batching plant site – lease expires 2013.

Sydney Fish Market Leases the wharf service to charter vessel operators including the Manly Fast Ferry and Fusion Cruises as well as privately owned yachts. Commercial fishing fleet includes 15 vessels. There are between 20 and 30 vessel movements per day.

Australian Heritage Fleet Refitting and maintenance area for historical vessels.

SOURCE:URBIS 2012.

2.2.2 Vessel movements through the Glebe Island Bridge channel

There is limited data available on the movement of vessels through the Glebe Island

Bridge Channel. The much quoted figure of 200 vessels per day (Hasham, 2013 /

BPT, 2012 / Urbis, 2012) is already somewhat old, having been determined in

February 2005 by a study of vessel movements undertaken by the former Roads

and Traffic Authority (RTA). Of these vessels, it was found that a significant

proportion (10 per cent) of the estimated 200 vessels per day crossing this passage

exceed the 4.7 metre air draft limit imposed by the Bridge when in the ‘closed’

position.

While small vessel traffic is not thought to have increased significantly since then, it

is estimated that there has been an approximate 50 per cent increase in the number

of larger vessels using this passage. This is due to the increase in larger vessels

departing from various commercial maritime enterprises within the Bays including

the Sydney Superyacht Marina, the Blackwattle Bay Marina and Sydney Fish

Markets (RMS, 2011).

A separate study carried out in June 2006 and commissioned by the Sydney Boat

House found that up to 29 power vessel movements occurred per day, a high

proportion of which exceed the air draft limit.



A counting exercise commissioned by the City of Sydney found an average of 180

vessel movements per day over a 3-week period in June 2013 and a 1-week period

in August 2013, of which 47 per cent were large vessels that would require a

restored bridge to open to enable their passage through the channel. It is likely that

recorded vessel movements would be higher if the exercise were to be conducted

over the warmer months of the year.

A summary of available information on vessel movements is presented in Table 2.

Note that none of the study periods include assessments of the commercial peak

season, which occurs in November and December.

TABLE 2 VESSEL MOVEMENTS DATA

Source Time of year Vessel Movements

Water Research Laboratory, 2004 24 September – 14

October

62 vessels per hour (peak time of day)

Former RTA, 2005

February 198 total - 19 unable to fit under the bridge

Sydney Boat House, 2006 Uncertain 29 movements from RMS and Sydney Superyacht Marina

alone, with a ‘high proportion’ of these exceeding the air

draft limit

City of Sydney, 2013 June and August Average of 180 per day, of which 85 are large vessels

SOURCE: RMS,



3 Options development

This chapter presents an initial long list of options for Glebe Island Bridge. These

options are assessed and refined into a number of shortlisted options. The costings

were provided by RMS and were developed by RMS Bridge Engineering specialists

in consultation with TLB Engineers and M Raven North estimating consultants.

3.1 Long list of options

There are three broad categories of options for the Glebe Island Bridge:

restoration / preservation

removal / demolition

replacement / adaptation.

Within each category there are a number of different options, the most realistic and feasible of which are outlined and examined below.

A summary of the different options and their costs is presented in Table 3. All costs are based on estimates from RMS calculating using construction cost rates. Actual costs may vary subject to market processes.

TABLE 3 LONG LIST OF OPTIONS CONSIDERED FOR COST-BENEFIT ANALYSIS

Category Option Description Cost

Preservation / restoration

Option 1 Minimal repairs to ensure boating safety * $12.0 million

Option 2 Restoration of the bridge for two lanes of traffic on the bridge $37.5 million

Option 3 Restoration of central bridge for safety purposes, removal of abutments

Not costed

Removal / demolition

Option 1 Demolish swing span superstructure only ** $39.3 million

Option 2 Demolish swing span and central stone pier to bed level ** $43.9 million

Option 3 Demolish swing span, approach spans and all 3 piers ** $37.3 million

Option 4 Demolish swing span, approach spans and all 3 piers, as well as removal of approach embankments

$40.2 million

Replacement / adaptation

Option 1 Replacement of bridge with pedestrian footbridge Not costed

Option 2 Replacement of bridge with modern swing span mechanism Not costed

Option 3 Replacement of bridge with light rail capability Not costed

NOTE: * ALLOWS FOR A MAINTENANCE LOAD OF 2.0KPA AND/OR A MEDIUM SIZE VEHICLE UP TO 9 TONNES ON THE BRIDGE

** FOR SAFETY REASONS, REMOVAL/DEMOLITION OPTIONS INCLUDE THE RESTORATION OF THE REMAINING INFRASTRUCTURE

NOT DEMOLISHED, SUCH AS: RESTORATION OF THE EXISTING TIMBER FENDERS, RESTORATION OF STEEL BRIDGE APPROACHES

AND SPANS WHERE APPLICABLE, AND RESTORATION OF SANDSTONE ABUTMENTS AND THE CENTRAL PIER WHERE APPLICABLE

SOURCE: RMS



3.1.1 Preservation / restoration

Refurbishment or restoration of the Bridge can be undertaken to various degrees:

from simply ensuring that the bridge no longer poses a hazard to vessels travelling

through the channel, to full restoration of the Bridge to working order.

Preservation Option 1 (Base Case)

This option would essentially leave the situation ‘as is’ pending further developments

in the Bays Precinct Area. The major costs involved would be investigation costs

and maintenance work in order to bring the Bridge up to the standard required of

heritage structures identified on the RMS Heritage and Conservation Register.

Preservation Option 2 (Restoration)

Restoring the Bridge to its former glory, as shown in Figure 5 below, would provide

amenity value to local residents at Johnstons Bay and Ultimo as well as the wider

community. A thoroughfare for cyclists would also improve cycle paths through the

city. The heritage value of the Bridge would be preserved.

FIGURE 5 PRESERVATION – OPTION 2 (RESTORATION)

SOURCE: RMS

The costing for full rehabilitation of the Bridge would be $37.5 million dollars,

including a 35 per cent contingency amount. A more detailed breakdown of costs is

presented in Table 4.

TABLE 4 PRESERVATION - OPTION 2

Project item Cost

Construction $22.95 million

Project management and client costs $4.86 million

Contingency $9.70 million

Total cost $37.52 million

SOURCE: RMS



Preservation Option 3

The third option for preservation, presented in Figure 6, would preserve the most

unique part of the Bridge, while facilitating the navigation of the channel. However, it

would not restore the functionality of the Bridge as a physical connection for cyclists

and pedestrians between Pyrmont and Glebe Island.

FIGURE 6 PRESERVATION – OPTION 3

SOURCE: RMS

This option, however, does not provide any transport function and also loses some

of the heritage function of the Bridge. One important component of the heritage

value of the Bridge is its operability and an operational history dating back to 1903.

3.1.2 Demolition

Four major options for demolition have been outlined by RMS NSW. These are as

follows:

1. Demolish swing span and super structure only

2. Demolish swing span and central stone pier to bed level

3. Demolish swing span, approach spans and all 3 piers

4. Demolish swing span, approach spans and 3 piers, as well as removal of approach embankments 1.5m above the Mean Sea Level (MSL).

The engineering works required for each demolition option are shown in Table 5.



TABLE 5 WORKS REQUIRED FOR EACH DEMOLITION OPTION

Work item Option 1 Option 2 Option 3 Option 4

Remove Piles and Timber Fender Yes Yes Yes Yes

Remove Centre Swing Span Yes Yes Yes Yes

Remove Centre Pivot No Yes Yes Yes

Remove Approach Girders No No Yes Yes

Rehabilitate Approach Girders Yes Yes No No

Remove Road Approach and Bridge BN 26 No No No Yes

Rebuild Approach Road and Bridge No No No No

Rehabilitate Approach Road and Bridge BN26 Yes Yes Yes No

SOURCE: RMS

Demolition Option 1

Option 1 would remove the swing span and other superstructure. It would cost a

total of $39.3 million dollars, and would leave a navigational hazard in the middle of

the channel as shown below

TABLE 6 DEMOLITION – OPTION 1

Project item Cost

Contractors costs $7.8 million

Restore approach and spans $15.7 million

Project development, design and management $4.7 million



SOURCE: RMS

Demolition Option 2

Option 2 is more expensive than Option 1, but it involves removal of the central pier

down to the bed level, thus allowing for vessels with a greater draft or wider beam to

pass through the channel free of any navigational hazard.




Project item Cost

Contractors costs $11 million

Restore approach and spans $15.7 million

Project development, design and management $5 million



SOURCE: RMS

Demolition Option 3

Option 3 involves the removal of the swing span, the central pier, fenders, approach

spans and rest piers, which would provide an even wider channel for commercial

boats crossing between the Bays and the Harbour.


Project item Cost


Restore approach $4.1 million




SOURCE: RMS

Demolition Option 4

Option 4 is to demolish all structures and approach embankments. This would leave

the widest channel for all kinds of maritime purposes and would remove the

approach embankments 1.5 metres above the MSL.




Project item Cost


Restore approach NA


Contingency (31%) $9.6 million


SOURCE: RMS

3.1.3 Replacement

At present there are two main ideas for replacing the Bridge:

1. Replacing the Bridge altogether with a pedestrian/cycle bridge.

2. Adapting the existing structure to provide a more modern and efficient solution facilitating both pedestrian and vessel access.

Replacement Option 1

The first idea is to establish a new fixed pedestrian and cycle bridge across the

channel (see Figure 7).

FIGURE 7 REPLACEMENT – OPTION 1

SOURCE: TRANSPOSRT FOR NSW



The major issue with this kind of solution is that it would restrict Bay access for some

of the commercial and other vessels passing between the Bays and the Harbour.

This would lead to an adverse economic outcome for commercial maritime activities

within the Bays. It would also prohibit the Bays from being used by recreational craft

that have a higher drafting than this bridge.

Replacement Option 2

This option would involve replacing the approach road surface with civic paving or

park materials and creating a new pedestrian/cycle swing bridge. It would retain and

restore the swing mechanism and create a linear parkland area with seating,

lighting, planting and cycle infrastructure.

FIGURE 8 REPLACEMENT – OPTION 2

SOURCE: TRANSPOSRT FOR NSW

This would again connect the Bays Precinct to Pyrmont Light Rail via the waterfront

and would allow for the creation of a new park under the bridge at Bank Street with

restored buildings and new harbour access.

Neither of the replacement options is precluded by demolishing the Bridge. If the

Government was to pursue redevelopment options for Glebe Island in the longer-

term, there is also potential for replacement options to be privately funded as part of

the development at no cost to Government.

3.2 Shortlisted options

The shortlisted options for the cost-benefit analysis are:

Base Case – Preservation / Restoration Option 1

Full Demolition – Demolition Option 4

Restoration – Preservation / Restoration Option 2.

Preservation / Restoration Option 3 was eliminated as it does not preserve the

integrity of the original Bridge design and therefore confers only partial heritage

value to the preserved structure. It also does not restore the functionality of the

original Bridge.



The replacement options were eliminated because they provide similar transport

functionality as Preservation / Restoration Option 2 without the heritage benefits of

that option.

Among the demolition options, Option 3 was shortlisted because it enables the

channel to be widened relative to Options 1 and 2 (thereby improving the transit of

vessels through the channel and reducing the likelihood of an accident), while

costing less than Option 4 (which would have further widened the channel).

The costs and benefits associated with the shortlisted options are assessed in the

next two chapters of the report.



4 Assessment of costs

The capital and recurrent costs of the Base Case, the Restoration option and the Full Demolition option are set out in this chapter.

4.1 Capital costs

4.1.1 Base Case

The capital costs associated with the Base Case are shown in Table 10. The total

capital cost is estimated at $12.013 million in 2013 dollars. It is assumed that the

works will be completed within a year.

TABLE 10 CAPITAL COST OF BASE CASE

Item Cost

Demolish and Replace Fender System $4,800,000

Dolphins $1,800,000

Structural Repairs to Approach Spans allow Year 1

Painting of Approach Spans allow Year 1

Repair to Bridge No 62 -Bearings and Structural $250,000

Replace Swing Gate $45,000

Repair Pedestrian Barrier $86,000

Replace Lighting $72,000

Sandstone Facing $301,000

Total Construction Cost $7,354,000

Project Management and Client Costs $1,544,340

Contingency $3,114,419

Total Project Costs $12,013,000

SOURCE: RMS

4.1.2 Full Demolition

The capital costs associated with the Full Demolition option are shown in Table 11.

The total capital cost of the option is $37.303 million in 2013 dollars. The

incremental capital cost of the option is thus $25.290 million in 2013 dollars.

Again, it is assumed that the works will be completed within a year.



TABLE 11 CAPITAL COST OF FULL DEMOLITION OPTION

Item Cost

Project Development $926,770

Investigation and Design $1,004,001

Construction

Preliminaries, Surveys, Temporary Works $2,024,373

Environmental Works $1,896,306

Adjustment to existing services $390,084

Controlled Demolition $19,205,202

Earthworks $55,813

Miscellaneous $1,844,152

Provision for Traffic $265,608

Restore approach and Abutment $5,740,000

PAI $172,818

Project Management Services $3,119,651

Client Representation $311,965

Handover $346,281


SOURCE: RMS

4.1.3 Restoration

The capital costs associated with the Restoration option are shown in Table 12. The

total capital cost is estimated at $37.517 million in 2013 dollars. The incremental

capital cost of the option (above that of the Base Case) is $25.502 million in 2013

dollars.

TABLE 12 CAPITAL COST OF RESTORATION OPTION

Item Cost

Preliminaries $2,748,700

Environmental $1,404,700

Adjustment to Services $288,000

Demolition $2,708,800

Fender Restoration and Repair $2,210,700

Earthworks $232,400

Pavements $1,121,000

Steelwork Repairs $2,181,500

Steelwork Repainting $8,554,800

Electrical and Mechanical $339,100

Sandstone Facing Restoration $556,700

Miscellaneous $448,100

Provision for Traffic $159,400

Total Construction Cost $22,953,900

Project Management and Client Costs $4,863,000

Contingency $9,699,400


SOURCE: RMS



As in the Base Case, it is assumed that the works will be completed within a year.

4.2 Recurrent costs

4.2.1 Base Case

According to RMS, under the Base Case the following maintenance works will need to be undertaken over the 30-year analysis period:

annual maintenance (costing $100,000 per year in 2013 dollars)

structural steelwork repairs and road repairs within the first two years (costing a total of $2,542,000)

major repainting (20 per cent of steel area in Year 2, 50 per cent in Year 5 and 30 per cent in Year 10)

bridge bearings replacement and other associated works (costing $250,000 every 15 years)

sandstone facing (100 square metres costing $301,000 every 10 years)

timber fender maintenance (costing $807,000 every 10 years)

mechanical and electrical upgrades (AC-DC in Year 5 and mechanical in Year 10, costing $200,000 on each occasion).

The year-by-year recurrent costs of the Bridge in the Base Care are shown in Table

13.



TABLE 13 RECURRENT COSTS UNDER THE BASE CASE, YEAR 1 TO YEAR 30

Annual

maintenance

Structural steelwork

repairs and road

repairs

Major

repaint

Bridge

bearings

and

structural

Sandstone

facing

Timber

fender

maintenance

Mechanical

and

electrical

upgrades

Total

recurrent

costs

Year 1 $100,000 $2,542,000

$2,642,000

Year 2 $100,000

$4,494,000

$4,594,000

Year 3 $100,000

$100,000

Year 4 $100,000

$100,000

Year 5 $100,000

$7,284,000

$200,000 $7,584,000

Year 6 $100,000

$100,000

Year 7 $100,000

$100,000

Year 8 $100,000

$100,000

Year 9 $100,000

$100,000

Year 10 $100,000 $154,000 $5,475,000

$301,000 $807,000 $200,000 $7,037,000

Year 11 $100,000

$100,000

Year 12 $100,000

$100,000

Year 13 $100,000

$100,000

Year 14 $100,000

$100,000

Year 15 $100,000

$250,000

$350,000

Year 16 $100,000

$100,000

Year 17 $100,000

$100,000

Year 18 $100,000

$100,000

Year 19 $100,000

$100,000

Year 20 $100,000

$301,000 $807,000

$1,208,000

Year 21 $100,000

$100,000

Yer 22 $100,000

$100,000

Year 23 $100,000

$100,000

Year 24 $100,000

$100,000

Year 25 $100,000

$100,000

Year 26 $100,000

$100,000

Year 27 $100,000

$100,000

Year 28 $100,000

$100,000

Year 29 $100,000

$100,000

Year 30 $100,000

$250,000 $301,000 $807,000

$1,458,000

SOURCE: RMS

4.2.1 Full Demolition

It is assumed that no recurrent costs will be incurred under the Full Demolition

option.

4.2.2 Restoration

Under the Restoration option, the following maintenance works will need to be undertaken over the 30-year analysis period:

annual maintenance (costing $50,000 per year in the first five years and $100,000 per year thereafter)

major repairs (costing $7,124,500 every 15 years)



timber fender maintenance (costing $807,000 every 10 years)

bridge bearings replacement (costing $50,000 every 15 years)

road restoration (costing $160,000 every five years)

sandstone facing (100 square metres costing $301,000 every 10 years)

mechanical and electrical upgrades (AC-DC in Year 5 and mechanical in Year 10, costing $200,000 on each occasion).

In addition, the annual operational costs of the restored Bridge, including for labour

and utilities, are estimated by RMS to be $500,000 in 2013 dollars based on

operating costs of other opening bridges. The year-by-year recurrent costs of the

Bridge in the Restoration Option are shown in Table 14.

TABLE 14 RECURRENT COSTS UNDER THE RESTORATION OPTION, YEAR 1 TO YEAR 30

Annual

maintenance

Major

repaint

Timber

fender

maintenance

Road

restoration

Sandstone

facing

Mechanical

and

electrical

upgrades

New

bridge

bearings

Operational

costs

Total

recurrent

costs

Year 1 $50,000

$500,000 $550,000

Year 2 $50,000

$500,000 $550,000

Year 3 $50,000

$500,000 $550,000

Year 4 $50,000

$500,000 $550,000

Year 5 $50,000

$160,000

$200,000

$500,000 $910,000

Year 6 $100,000

$500,000 $600,000

Year 7 $100,000

$500,000 $600,000

Year 8 $100,000

$500,000 $600,000

Year 9 $100,000

$500,000 $600,000

Year 10 $100,000

$807,000 $160,000 $301,000 $200,000

$500,000 $2,068,000

Year 11 $100,000

$500,000 $600,000

Year 12 $100,000

$500,000 $600,000

Year 13 $100,000

$500,000 $600,000

Year 14 $100,000

$500,000 $600,000

Year 15 $100,000 $7,124,500

$160,000

$50,000 $500,000 $7,934,500

Year 16 $100,000

$500,000 $600,000

Year 17 $100,000

$500,000 $600,000

Year 18 $100,000

$500,000 $600,000

Year 19 $100,000

$500,000 $600,000

Year 20 $100,000

$807,000 $160,000 $301,000

$500,000 $1,868,000

Year 21 $100,000

$500,000 $600,000

Yer 22 $100,000

$500,000 $600,000

Year 23 $100,000

$500,000 $600,000

Year 24 $100,000

$500,000 $600,000

Year 25 $100,000

$160,000

$500,000 $760,000

Year 26 $100,000

$500,000 $600,000

Year 27 $100,000

$500,000 $600,000

Year 28 $100,000

$500,000 $600,000

Year 29 $100,000

$500,000 $600,000

Year 30 $100,000 $7,124,500 $807,000 $160,000 $301,000

$50,000 $500,000 $9,042,500

SOURCE: RMS



4.3 Costs to NSW Government

The total (undiscounted) costs to the NSW Government of each of the shortlisted

options over the 30-yer analysis period in 2013 dollars are shown in Table 15. The

total cost is highest for the Restoration Option ($73.7 million), followed by the Base

Case ($39.2 million).

TABLE 15 TOTAL COSTS TO GOVERNMENT OVER 30-YEAR ANALYSIS PERIOD, BT OPTION (2013

DOLLARS)

Base Case

Full Demolition

Restoration

Capital costs $12.0m $37.3m $37.5m

Total recurrent costs (Year 1 to Year 30) $27.2m $0.0m $36.2m

Total capital and recurrent costs $39.2m $37.3m $73.7m

SOURCE:



5 Assessment of benefits

The benefits associated with the Restoration and Full Demolition options, relative to

the Base Case, are identified, assessed and quantified (where possible) in this

chapter.

As some of the benefits are very difficult to quantify and precisely place a value on,

in particular the amenity and heritage benefits of the Restoration option, an

alternative strategy was adopted to address this challenge.

5.1 Full demolition option benefits

5.1.1 Avoided maintenance costs

Demolishing the Glebe Island Bridge means that the recurrent costs associated with

the Base Case can be avoided. The resulting year-by-year benefit is shown in

Figure 9.

FIGURE 9 AVOIDED MAINTENANCE COSTS OF FULL DEMOLITION OPTION, YEAR 1 TO YEAR 30

(2013 DOLLARS)

SOURCE: ACIL ALLEN

5.1.2 Safety benefits

According to records held by Transport for NSW, in the period 1992/93 to 2012/13

there has been 11 reported boating incidents in the immediate vicinity of Glebe

Island Bridge. These 11 incidents were comprised of one fatal incident and 10 non-

injury incidents.

$0

$1

$2

$3

$4

$5

$6

$7

$8

1 3 5 7 9 11 13 15 17 19 21 23 25 27 29

Millions

Year



Seven of these incidents have involved a collision with the Bridge or its structures.

Were the Bridge to be removed, it is likely that there would be a very significant

decrease in ‘collision with fixed object’ incidents in this area.

According to Transport for NSW, a comparison between the number of incidents at

Glebe Island Bridge and other similar bridges reveals that the incident rate at Glebe

Island Bridge is significantly higher than at other similar locations. For example, at

Iron Cove Bridge there has been only one reported incident during this period, and

at Fig Tree Bridge in Lane Cove River there have been only three reported

incidents.

Based on the historical average for the period examined, the mean rate of incidents

occurring in the vicinity of Glebe Island Bridge was calculated by Transport for NSW

to be 0.52 (confidence bounds of 0.21 to 0.83) incidents per year. Interestingly, the

incident rate appears to be increasing, with a mean from 1992/93 to 2003/04 of 0.18

and a mean from 2004/05 to 2012/13 of 0.9 (a statistically significant increase).

THE ASSUMPTIONS UNDERPINNING ACIL ALLEN’S ESTIMATE OF THE SAFETY BENEFITS ASSOCIATED

ASSOCIATED WITH THE DEMOLITION OF THE BRIDGE ARE SHOWN IN TABLE 16. THE

VALUE OF A DEATH AVERTED (KNOWN AS THE VALUE OF STATISTICAL LIFE OR VSL –

SEE

Box 1) and the value of a serious injury averted are drawn from Principles and

Guidelines for Economic Appraisal of Transport Investments published by Transport

for NSW in March 2013. Transport for NSW estimates that the number of accidents

would decrease by at least 50 per cent after the demolition of the Bridge.

TABLE 16 ASSUMPTIONS USED IN ESTIMATING SAFETY BENEFITS OF THE FULL DEMOLITION

OPTION

Assumption Assumed value Source

No. of non-injury accidents in last 8 years 7 Transport for NSW

No. of fatalities in last 20 years 1 Transport for NSW

No. of serious injuries in last 20 years 0 Transport for NSW

Value of property damage per accident $50,000 ACIL Allen estimate

Value of Statistical Life (VSL) $6,412,584 TfNSW Principles and Guidelines for Economic Appraisal of Transport Investments, March 2013

Value of serious injury averted $482,043 TfNSW Principles and Guidelines for Economic Appraisal of Transport Investments, March 2013

% reduction in accidents after demolition 50% Transport for NSW estimate

SOURCE: VARIOUS



BOX 1 VALUE OF STATISTICAL LIFE

Accident costs can be estimated based on two main approaches: willingness to pay and human capital cost:

The willingness to pay approach uses an ex-ante measure of the amount that individuals are willing to pay for accident prevention. Values of accident costs are derived from stated preference surveys where respondents are asked to choose hypothetical scenarios systematically varied in safety, travel time and cost. Econometric models are specified and developed to statistically estimate the monetised valuation of safety.

The human capital approach captures the ex-post sum of various identifiable costs, such as loss of work income, medical expenses, long term care, insurance cost, vehicle repair, property damage, travel delays and policing.

The Value of Statistical Life (VSL) is often used to estimate the benefits of reducing the risk of death. The VSL is an estimate of the financial value society places on reducing the average number of deaths by one. The VSL is most appropriately measured by estimating how much society is willing to pay to reduce the risk of death. However, there are different methods of measuring society’s willingness to pay to reduce the risk of death.

One direct method is to ask individuals through a survey what they would pay to save or prolong life. There is evidence that willingness to pay surveys overestimate willingness to pay when compared to actual consumer choices subject to a budget constraint.

One method which incorporates a budget constraint is to observe how much consumers pay for products that reduce the risk of death or injury, for example, the purchase of safety items in a car.

Another indirect method is to observe how much workers are willing to pay (through reduced wages) for an improvement in workplace safety. This form of analysis is most commonly used for estimating the value of statistical life.

SOURCE:OFFICE OF BEST PRACTICE REGULATION , BEST PRACTICE REGULATION GUIDANCE NOTE – VALUE OF STATISTICAL

LIFE, NOVEMBER 2008

5.1.3 Time savings of maritime operators

Full demolition of Glebe Island Bridge would potentially enable smoother and

quicker passage of vessels through the widened channel.

The assumptions underpinning ACIL Allen’s estimate of the potential time savings

for maritime operators and other users of the channel if the Bridge is completely

demolished are shown in Table 17.



TABLE 17 ASSUMPTIONS USED IN ESTIMATING MARITIME TIMESAVINGS OF THE FULL DEMOLITION OPTION

Assumption Assumed

value Source

Average number of boats passing through the bridge per day 300 * TfNSW Maritime Division estimate

Average number of passengers per boat 4.8 ACIL Allen survey of maritime businesses

Proportion of boat trips that are business-related 78% ACIL Allen survey of maritime businesses

Value of travel time savings per hour for business trips $44.03 TfNSW Principlaes and Guidences for Economic Appraisal of Transport Investments, March 2013

Value of travel time savings per hour for leisure trips $13.76 TfNSW Principlaes and Guidences for Economic Appraisal of Transport Investments, March 2013

Average time saving per boat due to full demolition (minutes) 10.0 ACIL Allen survey of maritime businesses

NOTE: * A COUNTING EXERCISE COMMISSIONED BY THE CITY OF SYDNEY FOUND AN AVERAGE OF 180 VESSEL MOVEMENTS PER DAY OVER A 3-WEEK PERIOD IN JUNE 2013

AND A 1-WEEK PERIOD IN AUGUST 2013, OF WHICH 47% WERE LARGE VESSELS THAT WOULD REQUIRE A RESTORED BRIDGE TO OPEN. IT IS LIKELY THAT RECORDED VESSEL

MOVEMENTS WOULD BE HIGHER IF THE EXERCISE WERE TO BE CONDUCTED OVER THE WARMER MONTHS OF THE YEAR.

SOURCE: VARIOUS

Information obtained from the survey of maritime businesses in Rozelle and

Blackwattle Bays suggests the following: 78 per cent of trips through the channel are

for businesses rather than leisure; there are 4.8 passengers per vessel on average;

and the average time saving per vessel enabled by full demolition of the Bridge

would be 10.0 minutes. RMS estimates that currently up to 300 vessels pass

through the channel each day and that vessel movements are likely to grow by more

than 2 per cent per annum.

5.2 Restoration option benefits

Restoring Glebe Island Bridge reduces the future costs of maintaining the Bridge. It

also results in time savings for some of the Balmain and East Balmain residents who

commute to work in the inner city by cycling or walking. It will also generate amenity

benefits for recreational cyclists and walkers who use the Bridge as part of their

route, as well as better realising its heritage value to Sydneysiders.

5.2.1 Avoided maintenance costs

The benefit of reduced maintenance costs associated with the restored Bridge

relative to the Base case is quantified by subtracting the recurrent cost shown in

Table 14 from that shown in Table 13.

The resulting year-by-year benefit is shown in Figure 10. The avoided maintenance

costs are positive in the first 15 years of the analysis period and negative in the next

15 years. The negative spikes in Year 15 and Year 30 correspond to the costs of

repainting the restored Bridge.

FIGURE 10 AVOIDED MAINTENANCE COSTS OF RESTORATION OPTION, YEAR 1 TO YEAR 30 (2013

DOLLARS)



SOURCE: ACIL ALLEN

5.2.2 Delays for vessel operators

ACIL Allen’s survey of maritime businesses at Blackwattle and Rozelle Bays indicates that the average delay per vessel is expected to be 14.3 minutes when the bridge is primarily closed to maritime traffic and only periodically opened (no more than once per hour) after restoration. This is the estimated average delay for all vessels – there would be no delay for smaller vessels that can pass under the Bridge and delays in excess of 14.3 minutes for larger vessels that have to queue and wait for the Bridge to open.

5.2.3 Time savings of commuters

According to the NSW Bureau of Transport Statistics, 3,744 residents in the

transport zones around Balmain and Balmain East commute to work in the Sydney

Inner City each work day of the week. Of these, 208 (approximately 6 per cent) cycle

and 89 (approximately 3 per cent) walk. In addition, 374 residents in Sydney Inner

City commute to Balmain and Balmain East for work. Of these, 21 (approximately 6

per cent) cycle and 12 (approximately 4 per cent) walk.2

Therefore, there are approximately 229 cyclists and 101 walkers each work day who

could potentially enjoy time savings by commuting to work via the low-level restored

Glebe Island Bridge instead of the high-level Anzac Bridge.

This is predicated on cyclists/pedestrians being able to directly access the Bridge

from Balmain. Public access from Balmain to White Bay is currently limited due to

port operations. Some connecting infrastructure (such as a bike path) would

therefore need to be provided. This connecting infrastructure has not yet been

costed.

While the number of cyclists/pedestrians using the Bridge would significantly

increase if residential development occurred on Glebe Island, the NSW Government

2 This information was accessed via the NSW Bureau of Transport Statistics’ online JTW Explorer, available at

http://visual.bts.nsw.gov.au/jtwbasic/

-$8

-$6

-$4

-$2

$0

$2

$4

$6

$8

1 3 5 7 9 11 13 15 17 19 21 23 25 27 29

Millions

Year

http://visual.bts.nsw.gov.au/jtwbasic/



has recently confirmed that it will be retained for port use – meaning that such

development is unlikely within the timeframe of the study.

In the cost-benefit analysis, it is assumed that on average the cyclists save 5

minutes per trip while the walkers save 15 minutes per trip. The assumptions

underpinning ACIL Allen’s estimation of the commuter time savings are shown in

Table 18.

TABLE 18 ASSUMPTIONS USED IN ESTIMATING COMMUTER TIME SAVINGS UNDER THE

RESTORATION OPTION

Assumption Assumed value Source

Projected growth in commuters per year 2.0% ACIL Allen estimate

Value of travel time savings per hour for business trips $44.03

TfNSW Principles and Guidelines for Economic Appraisal of Transport Investments, March 2013

Commuters - cycling

No. of cyclists per weekday who will benefit from the restored Bridge 229 NSW Bureau of Transport

Time savings per cyclist (minutes) 5.0 ACIL Allen estimate

Commuters – walking

No. of cyclists per weekday who will benefit from the restored Bridge 101 NSW Bureau of Transport

Time savings per walker (minutes) 15.0 ACIL Allen estimate

SOURCE: VARIOUS

5.2.4 Amenity benefits

Some of the stakeholders consulted by ACIL Allen envisage a restored Glebe Island

Bridge being an integral part of a seamless walking and biking trail that would

eventually connect all the disparate parts of the Bays Precinct. This link has been

identified in the City of Sydney’s Inner Sydney Regional Bike Plan.

There might therefore be potential amenity benefits for recreational walkers, joggers

and cyclists who choose to include the restored Glebe Island Bridge as part of their

walking / jogging / cycling route.

However, the number of recreational walkers and joggers is likely to be small unless

Glebe Island is redeveloped as a major residential precinct. As noted previously,

given the Government’s recent commitment to retain Glebe Island as a working port,

residential development within the 30-year timeframe of this analysis is unlikely.

ACIL Allen’s review of the literature on the economic valuation of walking trails did

not uncover any Australian and international studies whose findings would be

applicable to the valuation of amenity benefits resulting from the restoration of Glebe

Island Bridge.

5.2.5 Heritage value

As noted previously in Section 2.1.4, the Glebe Island Bridge is potentially of state

heritage significance as it demonstrates one of the earliest examples of an electric-

powered swing bridge in Australia.



Technically, it is a complementary structure to the Pyrmont Swing Bridge and has all

the same significant features, including the electrically-driven swing span. They

demonstrated the earliest use of electrical power for this purpose in Australia. The

bridges were considered very innovative at the time of their construction and

attracted international attention.

Both bridges were designed by Percy Allan, a highly-regarded Australian bridge

designer of the late 19th and early 20th century. Both represent the only examples

of such types of bridges in New South Wales and are still operable [Heritage Council

2012].

The historical significance of the Bridge is based on it having been a vital component

of the ‘five bridges’ route from the city to the northern and western suburbs. The

history of this crossing, going back to 1892, is closely associated with the economic

and social development of Sydney at the end of the 19th century.

The Glebe Island Bridge’s value to the Sydney community for having been a

significant contribution to the social and commercial development of Sydney and the

inner western suburbs is demonstrated by the public statements and interest in its

conservation during the broad-ranging community consultation undertaken for the

Bays Precinct by the NSW Government.

The heritage value of the Glebe Island Bridge encompasses non-use values such as

bequest value (where community members place a value on preserving the

structure for future generations), option value (where community members value

their future ability to access the Bridge even if they do not do so presently) and

existence value (where community members derive pleasure just from knowing the

structure is there, even if they never access it).

The heritage value of a historic structure such as the Glebe Island Bridge is usually

estimated using a stated preference or Contingent Valuation Method (CVM). More

specifically, a survey of community members is usually undertaken to elicit their

willingness-to-pay (WTP) for the preservation of the structure. However, such a

survey was beyond the scope of this study. Instead, ACIL Allen will calculate the

threshold value that the community must ascribe to the heritage and amenity

aspects of the restored Glebe Island Bridge in order for Restoration to be the

preferred option.

5.2.6 Option value for future light rail

There has been discussion among some stakeholders consulted by ACIL Allen

about a possible future extension of the Sydney Light Rail system that would

connect the existing station near the Sydney Fish Market to the White Bay Cruise

Passenger Terminal and the to-be-rejuvenated White Bay Power Station via a

restored Glebe Island Bridge.

However, a light rail connection between Pyrmont and White Bay is not in the NSW

Long Term Transport Master Plan and is therefore unlikely to eventuate in the next

20 years. In addition, even if the light rail extension was to be built, it is unclear if it

would result in significant travel time savings for patrons relative to a bus service



serving a similar route. For these reasons, an option value for future light rail has not

been included in the cost-benefit analysis.

5.2.7 Benefits for visitors to the Sydney Exhibition Centre @ Glebe

Island

Sydney Exhibition Centre @ Glebe Island will be the temporary home for Sydney’s

major trade and consumer exhibitions during the redevelopment of the Sydney

international convention, exhibition and entertainment precinct at Darling Harbour

between 2014 and 2016.

Some of the stakeholders consulted by ACIL Allen believe that a restored Glebe

Island Bridge could provide a useful pedestrian connection between the existing light

rail station near the Sydney Fish Market and the Sydney Exhibition Centre @ Glebe

Island.

However, transport links for the venue will already be extensive even without such a

pedestrian connection. Free special event transport will operate on exhibition days.

Regular, scheduled ferry services will run from Darling Harbour, along with regular,

scheduled shuttle bus services from Central Station. A taxi rank and drop-off point

will be located outside the venue and limited paid parking will be available on-site. A

shuttle bus will pick up visitors and exhibitors from selected bus stops and parking

locations in the immediate vicinity of the venue.

Consequently, potential benefits for visitors to the Sydney Exhibition Centre @

Glebe Island have not been included in the cost-benefit analysis.

5.2.8 Residual value

The residual value of the Bridge at the end of the 30-year analysis period is

estimated to be $15,757,140 in 2013 dollars.



6 Cost-benefit analysis results

The results of the cost-benefit analysis of the Glebe Island Bridge are presented in

this chapter. The outcomes of the sensitivity analysis undertaken to check the

robustness of these results are also reported.

6.1 Full Demolition option

6.1.1 Present value of incremental costs

The present value of incremental total costs for the Full Demolition option is $25.3

million in 2013 dollars. It is invariant to the choice of discount rate as the capital

expenditure is incurred in Year 1.

6.1.2 Present value of incremental benefits

The present value of benefits associated with the Full Demolition option under three

alternative real discount rates is shown in Table 19. NSW Treasury recommends

that a 7 per cent real discount rate be used as the central case, with 4 per cent and

10 per cent as sensitivities.

TABLE 19 PRESENT VALUE OF BENEFITS OF FULL DEMOLITION OPTION, 2013 DOLLARS

4% real discount

rate

7% real discount

rate

10% real discount

rate


Safety benefits $4.5m $3.0m $2.2m

Maritime travel time savings $80.0m $54.7m $39.8m

Total benefits $105.5m $75.9m $58.1m

SOURCE: ACIL ALLEN

6.1.3 Net present value

The net present value (NPV) of the Full Demolition option, calculated by subtracting

the present value of total incremental costs from the present value of total

incremental total benefits, under the alternative real discount rates is:



$29.9 million (10 per cent real discount rate).

6.1.4 Benefit-cost ratio

The benefit-cost ratio (BCR) of the Full Demolition option, calculated by dividing the

present value of total incremental benefits by the present value of total incremental

costs, under the alternative real discount rates is:

4.17 (4 per cent real discount rage)





Under the central assumption of a 7 per cent real discount rate, the present value of

the benefits of the option is exactly 3 times that of the present value of its costs.

6.2 Restoration option

6.2.1 Present value of incremental costs

The present value of incremental total costs for the Restoration options is $25.5

million in 2013 dollars. It is invariant to the choice of discount rate as the capital

expenditure is incurred in Year 1.

6.2.2 Present value of incremental benefits

The present value of the quantifiable benefits associated with the Restoration option

under the three alternative real discount rates is shown in Table 20. Note that the

maritime travel savings are negative as the restored Bridge will induce delays when

vessels are required to wait for the Bridge to open.

TABLE 20 PRESENT VALUE OF QUANTIFIABLE BENEFITS OF RESTORATION OPTION, 2013

DOLLARS

4% real discount

rate

7% real discount

rate

10% real discount

rate


Maritime travel time savings -$114.0m -$78.0m -$56.7m

Commuter time savings for cyclists and walkers

$21.9m $15.2m $11.3m

Residual value $5.0m $2.2m $1.0m

Total quantifiable benefits -$76.5m -$48.9m -$32.8m

SOURCE: ACIL ALLEN

The NPV of the Restoration option based on quantifiable benefits under the three

alternative discount rates is shown in the second row of Table 21. The difference in

the NPVs of the Restoration and Full Demolition options (based on the quantifiable

benefits of the Restoration option) is shown in the last row of the table.

TABLE 21 NPV OF QUANTIFIABLE BENEFITS OF RESTORATION OPTION AND DIFFERENCE IN NPV

BETWEEN RESTORATION AND FULL DEMOLITION OPTIONS, 2013 DOLLARS

4% real discount

rate

7% real discount

rate

10% real discount

rate

NPV of Restoration Option based on quantifiable benefits

-$102.0m -$74.4m -$58.3m

Difference in NPV of Restoration and Full Demolition options based on quantifiable benefits of Restoration option

$182.2m $125.1m $91.1m

SOURCE: ACIL ALLEN

In order for the Restoration option to be preferred over the Full Demolition option,

the yet-to-be quantified heritage and amenity benefits of the restored Bridge needs



to be at least $125.1 million in 2013 dollars in present value terms over the 30-year

analysis period under a 7 per cent real discount rate.

The “required” heritage value of the restored Bridge and present value of amenity

benefits to recreational walkers and cyclists depend on the proportion of

unquantified benefits that are ascribed to heritage benefits versus amenity benefits

(see Table 22).

TABLE 22 REQUIRED HERITAGE AND AMENITY BENEFITS FOR RESTORATION TO BE PREFERRED

OPTION – 7% REAL DISCOUNT RATE, 2013 DOLLARS

Distribution of required benefits Heritage value PV of amenity benefits




SOURCE: ACIL ALLEN

Suppose that the unquantified benefits are to be split evenly between heritage and

amenity benefits, each source of benefits would then need to be at least $62.5

million in present value terms under a 7 per cent real discount rate for Restoration to

emerge as the preferred option.

That is, the broader Sydney community would need to value the heritage aspects of

the Bridge at $62.5 million dollars today. In addition, in regards to amenity benefits,

the community would need to value them at $5.5 million per year in 2013 dollars

over the next 30 years. This equates to $15.20 per trip if 1,000 trips are made daily

across the restored bridge by recreational walkers and cyclists. (1,000 trips per day

equates to about 83 trips per hour assuming that trips are only made during the 12

hours of daylight each day.)

6.3 Sensitivity analysis

To test the robustness of the cost-benefit analysis results, ACIL Allen undertook sensitivity analyses around the key parameters and assumptions underpinning the cost-benefit analysis.

6.3.1 Full Demolition option

Maritime time savings

If the assumed average time saving per vessel after full demolition of the Bridge is

decreased from 10.0 minutes to 5.0 minutes, the BCR of the Full Demolition option

becomes significantly lower at:




If the assumed average time saving per vessel after full demolition of the Bridge is

decreased from 10.0 minutes to just 2.0 minutes, the BCR of the Full Demolition

option becomes even lower at:






Accident reduction

If the demolition of the Bridge results in only a 25 per cent reduction in accidents

(instead of the 50 per cent reduction previously assumed), the BCR of the Full

Demolition option becomes only slightly lower at:




Initial number and growth in vessel movements

If the assumed average number of current vessel movements through the channel

decreases from 300 per day to 180 per day, the BCR of the Full Demolition option

becomes lower at:




If the assumed annual growth rate of vessel movements through the channel

increases from 3.0 per cent to 5.0 percent, the BCR of the Full Demolition option

becomes higher at:




Conversely, if the assumed annual growth rate of vessel movements through the

channel decreases from 3.0 per cent to 1.0 per cent, the BCR of the Full Demolition

option becomes lower at:




6.3.2 Restoration option

Delays to vessel operators

If the expected average delay per vessel after restoration of the Bridge is halved

from 14.3 minutes to 7.15 minutes, the present value of heritage and amenity

benefits required for Restoration to be the preferred option decreases from $125.1

million in 2013 dollars over the 30-year analysis period (under a 7 per cent real

discount rate) to $86.2 million in 2013 dollars.

If this amount is evenly split between heritage and amenity benefits, for Restoration

to be the preferred option the heritage value of the restored Bridge must be at least

$43.1 million while the annual value of amenity benefits to recreational cyclists and

walkers must be at least $3.8 million per year in 2013 dollars. Assuming that 1,000



trips by such cyclists and walkers are made each day, the community must value

each trip at least $10.50.

If the expected average delay per vessel after restoration of the Bridge is increased

from 14.3 minutes to 20 minutes, the present value of heritage and amenity benefits

required for Restoration to be the preferred option increases from $125.1 million to

$156.6 million in 2013 dollars.

Commuter time savings

If the assumed time savings for road commuters is increased by 50 per cent (from

5.0 minutes to 7.5 minutes for cyclists and from 15.0 minutes to 22.5 minutes for

walkers), the present value of commuter time savings over the 30-year analysis

period (under a 7 per cent real discount rate) increases from $15.2 million in 2013

dollars to $22.9 million.

Vessel movements

If the initial number of vessel movements is assumed to be 180 per day instead of

300 per day, the present value of heritage and amenity benefits required for

Restoration to be the preferred option decreases from $125.1 million in 2013 dollars

over the 30-year analysis period (under a 7 per cent real discount rate) to $72.0

million in 2013 dollars.

6.4 Conclusion

The cost-benefit analysis indicates that Full Demolition of the Glebe Island Bridge

generates a relatively high BCR of 3.0 under a 7 per cent real discount rate. About a

quarter of the benefits of this option are attributable to maintenance cost savings

relative to the Base Case, while nearly three-quarters of the benefits are due to

expected maritime travel time savings from the widened channel. The BCR is

therefore sensitive to the assumed average time saving per vessel. If the assumed

average time saving is halved from 10 minutes to 5 minutes, the BCR decreases to

1.92, which remains significantly greater than 1.

Restoration of the Glebe Island Bridge generates benefits from reduced

maintenance costs relative to the Base Case as well as commuter time savings for

some of the cyclists and walkers who currently commute to work over the high-level

Anzac Bridge. However, these benefits are only a third of the value of the estimated

time losses that will be experienced by vessel operators when the bridge is primarily

closed and only periodically opened after restoration.

The heritage value of the restored Bridge and the amenity benefits experienced by

recreational walkers and cyclists have not been explicitly quantified in the cost-

benefit analysis. However, ACIL Allen’s analysis suggests that they have to be at

least $125.1 million in 2013 dollars in present value terms over the 30-year analysis

period (under a 7 per cent real discount rate) in order for Restoration to be the

preferred option.



If these “required” unquantified benefits are to be evenly split between heritage and

amenity benefits, the community must value the heritage aspects of the Glebe Island

Bridge at more than $62.5 million dollars today and value the amenity benefits to

recreational cyclists and walkers at more than $5.5 million a year. Assuming 1,000

trips are made each day by such cyclists and walkers, the community would have to

value each trip at more than $15.20 in 2013 dollars.



References AECOM, 2010. ‘Inner Sydney Regional Bike Plan: Implementation Strategy’, April.

Bays Precinct Taskforce (BPT), 2012. ‘Bays Precinct Strategic Review Framework Report to the NSW Government, Volume 1’, August.

Hasham, 2013. ‘Glebe Island Bridge is rotting away’ <http://www.smh.com.au/nsw/glebe-island-bridge-is-rotting-away-20130402-2h55b.html> Published April 13, Accessed 24/07/2013.

Leichhardt Municipal Council Report ‘Item 19 – Glebe Island Temporary Exhibition Centre’ 8 March 2013.

Urbis, 2012. ‘Glebe Island Bridge Large Marine Operators Consultation Report’, in Bays Precinct Appendix 5.

NSW, 2012, NSW Government Department of Environment and Heritage, 2012, ‘Glebe Island Bridge Statement of Significance’ <http://www.environment.nsw.gov.au/heritageapp/ViewHeritageItemDetails.aspx?ID=5051118> Accessed 22/07/2013.

Office of Best Practice Regulation, 2008. ‘Best Practice Regulation Guidance Note – Value of Statistical Life’, November.

RMS, 2012. ‘Glebe Island Bridge – Vessel Clearance’, source documents provided by RMS.

Transport for NSW, 2012. ‘NSW Long Term Transport Master Plan’, December.

Transport for NSW, 2013. ‘Principles and Guidelines for Economic Appraisal of Transport Investments’, March.

Photo: Balmain & Glebe Heritage

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