Slovenia to have network heavy vehicle toll in 2017

ITS International has reported that Norwegian toll provider Q-Free in consortium with Telekom Slovenia. Q Free confirms in its own press release as well.  The contract is for US$111 million (€99.99 million), which is for system delivery, including back office, "toll tags", service, maintenance, communications and systems integration.  There will be a 10 year service and maintenance element, with a three year possible extension.  The DARS (Slovenian Motorway Company) motorway and expressway network is 610km long.  

Slovenia's vignette charged road network

Slovenia's current heavy vehicle toll road network

Slovenia's road user charging policy is a curious combination of manual tolls for heavy vehicles only (trucks and buses) on main highways and a vignette (time based charge) for light vehicles.  The heavy vehicle toll rates are based on distance.  Note the heavy vehicle toll includes buses and coaches, not just trucks.  Slovenia is, of course, a major transit point between Italy/Austria and Croatia, Hungary, with transit freight (and passenger) traffic growing now Croatia is an EU Member State.

Ptolemus reports that there were three failed bidders (Kapsch, Autostrade and Skytoll), but most interestingly,  it is a conventional DSRC tolling system that is being implemented, not a GNSS based system - essentially updating the manual toll system in place for heavy vehicles to be more akin to the systems in Austria, Czech Republic and Poland.   The new system will expand to apply to all motorways and expressways in Slovenia, not just those currently subject to the toll. One report estimated an increase in expected revenues of €13m per annum due in part to the expansion of the tolled network and the improvement in traffic conditions.

It probably makes financial sense to simply convert manual tolls to electronic free flow on this relatively small network, as it updates what DARS already has.  There are long term operational cost benefits, and reductions in delays for heavy vehicles.  However, the decision to reject GNSS technology for now means it could not be extended beyond much of the motorway/expressway network economically, and the chance to build an ITS application sector on top of it (like Hungary has done).  As DARS is a commercial highway company its decision may be assumed to make commercial sense.  

I don't have further details as of yet, but it appears that the system has been procured in the conventional manner, not a PPP, so that DARS  will continue to own and operate the toll system.  However, the procurement of this system has been problematic over some years, with the initial call for interest in August 2011, but then suspended in March 2012, restarted in February 2013 and stopped again, with the current tender having been launched in July 2015.

The choice of a DSRC approach reflects it being the lowest cost tender.  Newspaper Večer has reported (Slovenian) that, saying that the other tenders were priced at €110.11m (Skytoll and Iskratel), €114.6m (Autostrada, Cetis and Engineering Informatics) and €114.96m (Kapsch).   Kapsch has a minority shareholding in Q-Free as well.  DARS says the Q-Free consortium had the highest scoring, and those who object may appeal.

There has been a request from Kapsch to audit the procurement according to Delo (Slovenian). Claims include that the tender documentation changed and that the specifications gave the winning bidder an advantage.  Concerns over the transparency around procurement of systems in other countries are known in the industry, so there is understandably sensitivity by both DARS and bidders.  It would be a shame if there were substance to allegations and concerns to delay the project further.   One concern is that because Q-Free bought Slovenian Company Traffic Design in 2014, that this gave it an advantage.  One report claims (Slovenia) that much of Traffic Design's business was obtained without competitive tenders, but representatives of the company and DARS strongly deny there were any irregularities.

Curiously,  DARS published a press release (Slovenian) on 30 March (after the announcement of the winning bid)  responding to allegations of irregularities in the procurement of the toll system.   It would appear it is not the end of this issue.

I have used Google Translate to extract the DARS press release in response to allegations, so apologies for the fractured English:

In connection with the reporting of some media that the implementation of the procurement procedure "Establishment and operation of multitrack electronic toll system in free-flow traffic on motorways and expressways" occurred organizing tenders and irregularities DARS d.d. denies such biased statements and strongly rejects any complaints about any organizing and editing your bids so by DARS d.d. as a third party. DARS d.d. All offers submitted by tenderers in any procurement procedure, led by DARS d.d., therefore, be kept in a specially protected room at the headquarters of Dunajska 7, Ljubljana, in the same way DARS d.d. also keeps the tenders received during the procedure.

The process is carried out in accordance with the provisions of the Public Procurement Act and the Act on the legal protection in public procurement procedures, so DARS d.d. during the course of the procedure will not land on the media influences and pressures. Also due care providers DARS d.d. He will not comment on the process, which is still in progress, regardless of the pressures of some of the media. Following this process, the public will be duly informed.

We emphasize that, in accordance with the provisions of the Public Procurement Act public opening of the bids in the presence of the media, suppliers and all stakeholders. Following the decision the client has all the bidders, at their request, granted access to both the tenderers who have submitted offers as well as documentation of the client. Among the insights all providers in accordance with the provisions of the Public Procurement Act and the Companies Act, protect their interests and on the basis of a decision on the protection of business secrets is a subscriber data offers all the providers that have been marked as business secret deals adequately protect (blanketed with several layers of paper). Consequently, the bid documents of all bidders correspondingly increased.

Once again firmly and strongly reject all allegations of irregularities opening and management process.

History of EZ-Pass

EZ Pass is a DSRC based electronic tolling system used on toll roads in 14 states in the USA.   Toll roads in Delaware, Illinois, Indiana, Maine, Maryland, Massachusetts, New Hampshire, New Jersey, New York, Ohio, Pennsylvania, Rhode Island, Virginia and West Virginia, share use of the system, which enables interoperability between the roads.  It uses what might be considered to be a rather dated, but effective standard of 915MHz sent at 500 kbit/s using the IAG protocol in 256-bit packets.  

The Cape May County Herald has published an interesting history of the system online as part of its own history of toll roads series by Bob Ahlers, who is a tolls opponent.

Some interesting points include how in 1993 some felt that would be a waste of money, especially with the general sentiment in favor of phasing out tolls. "Visionary skeptics foresaw that an electronic toll collection system would be very expensive to implement, requiring new buildings, computers, extensive wiring at toll booths, a new billing and collection system, technicians to maintain and test the new system and electronic identification sensors to allow toll plazas to differentiate between authorized and unauthorized vehicles."

In November 1996, the state announced plans to award a $488 million contract to MFS Network Technologies, to set up an electronic toll collection system called E-ZPass....it was discovered that MFS could not record toll cheats electronically, toll collectors had to write down the license plate numbers of violators

The introduction of E-ZPass did not go smoothly. Drivers, who erroneously entered the turnpike through an E-ZPass lane and then exited through a non-E-ZPass lane, found that they were charged the maximum toll at that exit. There were also cases where Turnpike “entries” didn’t get recorded but “exits” did.

Problems were even worse when tags malfunctioned. The assumed violation triggered a camera, which took a picture of the passing vehicle’s license plate. That resulted in the owner receiving a $25 fine for an “administrative fee.” If the owner was an E-ZPass customer, they could fill out the back of the violation, thus informing the agency that their pre-paid account had sufficient funds in it.

The agency then usually cancelled the fine and only assessed the toll fee. But this was expensive corrective action, since in addition to the time spent by the E-ZPass employees and the customer; a toll could result in two letters from the agency and one letter from the customer.

A weak link of the E-ZPass system is the transponder tag, which is mounted in each vehicle for detection and toll collection purposes. Each is equipped with a battery, which is supposed to last 10 years. But with many batteries wearing out sooner than had been anticipated, more than a million tags were replaced under a $28 million contract with Mark IV Industries (the company that supplied the transponder), approved by the Turnpike Authority in 2006. 

Lots of expensive lessons, that seem silly now, but how many others make the same mistakes again and again? The toll industry globally is still very fractionated, with many local players in the market. The opportunities are there for lesson learned in different jurisdictions to be applied more readily across the board, but by and large, most practitioners remain US, European or country specific focused. 

What of the future?  Well the article doesn't predict.  I presume there will be more conversions to fully electronic free flow tolls, and the question will be whether the technology ever moves on to the new Federal 5.9GHz standard which is necessary for all sorts of sophisticated ITS applications.  Moreso, how will EZPass evolve to cope with plans to replace fuel tax over the long term?  I expect the future to be bright, but more focused on providing the essential service of handling customers, opening, closing and changing accounts, rather than focusing on the technology used.   For it is in service provision that the biggest risks lie in terms of costs and therefore margins for operators.