Highways Agency - Safe roads, Reliable journeys, Informed travellers

Payment Mechanisms - Shadow Toll Payment Mechanism

The Highways Agency pays each DBFO Co an amount, which is based on the number and type of vehicles using the road, with adjustments made for lane closure and safety performance. These are known as shadow tolls as opposed to real tolls, as payment for usage is made by the Highways Agency rather than by the road user. The payment mechanism was structured to meet Government policy objectives for the trunk road network and PFI requirements, and incorporates payment based on:

• usage/demand;
• availability of service; and
• performance.

Usage/demand

Shadow toll payments are made per vehicle using a kilometre of the project road, in accordance with the tolling structure and increase over time in accordance with an indexation formula. Different payments are due for traffic within different traffic bands and dependant on the length of the vehicle.

Availability of Service

Where the project road consists of an existing stretch of road with one or more construction schemes along its length, then shadow toll payments will be made at a reduced level representing the cost and operation for the existing road.

Performance

Two elements form the basis of performance payments:

Safety performance payments - The DBFO Co is encouraged to suggest safety improvement schemes with incentives for improving safety on the Project Road. If approved, the DBFO Co constructs and pays for the scheme and is recompensed by receiving 25% of the economic cost of each personal injury accident avoided in the following five year period.

Lane closure charges - a deduction is made from the toll payment when lanes are closed. The size of the deduction is dependant upon the number of lanes closed, the duration of the closure, and the expected traffic at the time of the closure. Lane closures charges are only made for closures within the control of the DBFO Co.