The (in)accuracy of travel demand forecasts in the case of no-build alternatives

Impact appraisals of major transport infrastructure projects rely extensively on the accuracy of forecasts for the expected construction costs and travel time savings. The latter of these further depend on the accuracy of forecasts for the expected travel demand in both the build and no-build alternatives, in order to assess the impact of doing something rather than doing nothing. Previous research on the accuracy of demand forecasts has focused exclusively on the build alternatives, and revealed inaccuracies in the form of large imprecisions as well as systematic biases. However, little or no attention has been given to the accuracy of demand forecasts for the no-build alternatives, which are equally important for impact appraisals.This paper presents what the authors consider the first and only ex-post evaluation of demand forecast accuracy for no-build alternatives, based on an empirical study of 35 road projects in Denmark and the United Kingdom. The sample is based on road projects for which traffic impact studies have been prepared for the no-build alternative, but where the projects had not yet been built at the time of the forecast target year. Data sources for expected travel demand have been decision-support prepared for policy makers, while data sources for actual travel demand have been observed traffic on the transport network.The results show a tendency for systematic overestimation of travel demand in the no-build alternatives, which is in contrast to the systematic underestimation of travel demand observed in previous studies of build alternatives. These results indicate that the problem of systematic biases in travel demand forecasts for road projects have more problematic implications than previously assumed. The effect inflates rather than diminishes the problem of previously observed discrepancies between expected and observed travel demand, and the true magnitude of forecasting bias is thus greater than reported so far.The main implication for planning practice is that impact appraisals of road construction as a means of congestion relief appear overly beneficial. Congestion in the no-build alternative is assumed to be unbearable if new capacity is not added to the road network, while actual travel demand is typically lower. This is problematic, since an overestimation of benefits for road projects will, ceteris paribus, make it more difficult to argue for other means of dealing with congestion problems, which might prove more sustainable and resilient in the long run