CANAVERAL HARBOR, FLORIDA

Integrated Section 203 Navigation Study Report

&

Final Environmental Assessment

Economics Appendix(sub-part of Volume 3)

October 2012 (last revised February 2012)

ECONOMICS APPENDIX

Canaveral Harbor, Florida Integrated Section 203 Navigation Study Report &

Draft Environmental Assessment

February 2012

Canaveral Harbor, FL, Section 203 Study

Table of Contents 1 Introduction............................................................................................................................. 1

1.1 Project Location .............................................................................................................. 1

1.2 Port Description .............................................................................................................. 3

2 Existing Conditions................................................................................................................. 6

2.1 Federal Project Dimensions ............................................................................................ 6

2.2 Existing Conditions: Terminal Facilities ........................................................................ 7

2.2.1 Existing South Side Cargo Terminal Facilities ........................................................... 8

2.2.2 Existing North Side Cargo Terminal Facilities ........................................................... 9

2.2.3 Cruise Terminal Facilities ......................................................................................... 12

2.3 Socio-Economics .......................................................................................................... 13

2.4 Port Hinterland.............................................................................................................. 14

2.5 Port Canaveral Historical and Current Cruise Ship Operations .................................... 14

2.5.1 Floridas Cruise Ship Industry .................................................................................. 16

2.5.2 Port Canaverals Cruise Ship Industry...................................................................... 19

2.5.3 Port Canaveral Cruise Ship Operations .................................................................... 23

2.6 Port Canaveral Historical and Current Cargo ............................................................... 27

2.6.1 Existing Cargo Traffic Characterization................................................................... 29

2.6.2 Existing Cargo Fleet ................................................................................................. 32

2.6.3 Existing Cargo Fleet Operations and Tidal Advantage ............................................ 36

3 Without-Project Conditions .................................................................................................. 40

3.1 Navigation Features ...................................................................................................... 40

3.1.1 Canaveral Ocean Dredged Material Disposal Site (ODMDS) ................................. 40

3.1.2 Channel Conditions................................................................................................... 41

3.2 Terminal Facilities ........................................................................................................ 41

3.2.1 Cargo Terminals........................................................................................................ 41

3.2.2 Cruise Terminals ....................................................................................................... 42

3.3 Economic Conditions in the Project Hinterland ........................................................... 42

3.4 Port Canaveral Operations ............................................................................................ 44

3.4.1 Commodity Projections ............................................................................................ 44

3.4.2 Cargo Fleet Forecast ................................................................................................. 50

3.4.3 Projected Cruise Ship Operations ............................................................................. 51

Economics Appendix February 2012 Page i

Canaveral Harbor, FL, Section 203 Study

4 Problems Addressed by the Economic Analysis .................................................................. 53

4.1 Cruise Ship Size Limitations ........................................................................................ 53

4.1.1 Channel Widths ......................................................................................................... 53

4.1.2 Turning Basins .......................................................................................................... 54

4.2 Cargo Vessel Size Limitations ...................................................................................... 55

4.3 Surge Effects................................................................................................................. 58

4.4 Future Berth Congestion ............................................................................................... 59

4.5 Limitations on New Cargo and Cruise Terminals ........................................................ 59

5 Alternative Plan Evaluation .................................................................................................. 59

5.1 Detailed Alternative Plan Description .......................................................................... 60

5.1.1 Without-Project Condition Channel Description ...................................................... 60

5.1.2 Alternative With-Project Condition Channel Descriptions ...................................... 60

5.1.3 Identification of Alternative Plan Increments ........................................................... 60

5.2 Alternative Plan Costs................................................................................................... 68

5.2.1 Construction and Investment Costs .......................................................................... 68

5.2.2 Operations and Maintenance Costs........................................................................... 72

5.2.3 Total Average Annual Equivalent Costs................................................................... 73

5.3 With-Project Condition Benefits ................................................................................... 75

5.3.1 Channel Widening Benefits ...................................................................................... 76

5.3.2 Channel Deepening Benefits..................................................................................... 86

5.4 Net Benefits of Alternative Plans ................................................................................. 94

5.5 Summary of Accounts ................................................................................................... 96

5.6 Risk and Uncertainty..................................................................................................... 96

5.6.1 Commodity Forecast Uncertainty Ranking .............................................................. 97

5.6.2 Reduced Cargo Forecast and Cruise Schedule ......................................................... 98

5.6.3 Increased Cargo Forecast .......................................................................................... 98

5.6.4 Increased Seaport Canaveral Forecast ...................................................................... 99

5.6.5 Alternative Seaport Canaveral Vessel Origins ....................................................... 100

5.6.6 Alternative Cement Forecasts ................................................................................. 102

5.6.7 Alternative Slag Forecasts ...................................................................................... 105

5.6.8 Alternative Aggregate Materials Forecast .............................................................. 108

Economics Appendix February 2012 Page ii

Canaveral Harbor, FL, Section 203 Study

List of Tables Table 2-1 Port Canaveral Channel Dimensions .............................................................................. 6

Table 2-2 Port Canaveral Cargo Category by Berth ....................................................................... 8

Table 2-3 Port Canaveral Existing South Side Cargo Terminal Facilities Summary ..................... 9

Table 2-4 Seaport Canaveral (Vitol, S.A., Inc) Terminal Storage Capability .............................. 10

Table 2-5 Seaport Canaveral Vessel Type Summary February 2010 through July 2011 ............. 11

Table 2-6 Port Canaveral Existing North Side Cargo Terminal Facilities Summary ................... 11

Table 2-7 Port Canaveral Cruise Terminal Summary ................................................................... 13

Table 2-8 Projected Growth for City of Orlando 2004 - 2030 ..................................................... 14

Table 2-9 RCI Voyager, Freedom, and Oasis Class Vessel Deployment Schedules ................... 16

Table 2-10 North American Multi-Day Cruise Passengers by Selected Departure Ports (000s) 17

Table 2-11 North American Cruise Passengers By Destination (000s) ...................................... 18

Table 2-12 Port C