Canals

[The Rock Doctor]

I'd like to request that we revisit the rules around canal-building.

The costs themselves are not horribly unreasonable, although the cost of drydocks does add up pretty quickly.

The problem is with the assumption that canal revenues offset maintenance costs.  Part of this is that we have no maintenance costs associated with any other infrastructure, including drydocks; choosing to build a canal means the builder is incurring a severe opportunity cost in the form of IC not constructed and producing income.  In the case of something like Panama, this could mean ten or more IC not built, leaving the builder at a notable disadvantage compared to non-canal builders in raw economic output. 

Compounding this issue from a strictly trans-American canal perspective, there is no comparative trans-American major power with a strategic requirement to project power into both oceans.  Every one of us would find a canal useful, but none of us need it, and it's too pricey to just dump money into.

So I guess what I'm saying is, if we want any kind of serious marine infrastructure to be developed - canals or otherwise - we've got to allow them to pay for themselves.  The easiest approach for that is to allow the spending on canals to be converted into IC for revenue purposes once the project is completed.  Less easy is for the mod(s) to assign a basic income to be derived from its use that is not specifically tied to IC - this would ensure that there had to be some practical civilian value to the thing.

Thoughts?

[Desertfox]

Maybe if the cost of say the Panama Canal is equivalent to 10 IC, building the canal gains the builder the equivalent of half the ICs? So it makes 5 IC?

[Kaiser Kirk]

I guess there would be a couple approaches.

A) would be to just assign a revenue/turn based on length - build X length canal, get $y / turn.
Pro : simple
Con : really divorced from mercantile reality.

B) Figure there's a return on investment. For every $1 invested, the builder gets $0.1 / HY after completion.  So it slowly repays for itself. 
Pro : If you spend $15 and get 1 IC, that's +1/HY, so spending $15 in a canal and getting $1.5 isn't a bad deal - that's a  non game breaking incentive.
Con : Bookkeeping, and debates if a canal in that location would actually be worth it, potential abuse in building a really expensive or unrealistic canal because of the better reward.

C) Tie income generation to the length of maritime travel saved. Like $1 / HY for every 1000nm shorter maritime route. 
Pro : echo of real life economics, makes certain routes very desirable.
Con : Book keeping, altered world=altered trade paths, making sure it balances.

D) Something else entirely

[The Rock Doctor]

So I'm bumping this as construction on the Trans-Erica Canal finishes in 2/18 and will be operational in 1/19.  It will soon become relevant to my finances.

Rather than try to guess at savings to shipping, I'm going to suggest that I treat the canal zone - a single province - as a concession in the economic sense.

The rules allow for up to 10 IC in a concession.  The canal zone is coastal (no ports), with average fertility.  An IC would cost $15 and produce $1.50 with average resources.  Ten IC in a concession here would cost $150 and produce $15.

I'm spending $165.50 on the canal, including locks.  So that last $15.50 doesn't get me anything in terms of additional economic benefits, it's just the cost of finishing the project.  But when that's done, I'd be earning 10 IC worth of income from the canal - as noted above, $15.

Since the canal is not a concession in the political sense - it is a colony, not an occupied NPC territory - I would not be obliged to station 10 land points of military force there.  Defences are a whole other issue.

Thoughts?

[TacCovert4]

I like it for the simplicity.   You should easily be making yesterday much from commercial interests wanting to use the canal.

[Kaiser Kirk]

There is already a revenue rule included, as a result of the prior discussion on canals.


Revenue
Canals only generate revenue if they have commercial value. The Hog Island class freighter will serve as a 'standard'.  The following revenue will be earned ig the canal is open to international traffic, and can pass 140m x 21m x 7m vessel :

$0.25 per 1,000nm maritime shipping route saved.
Shipping routes will be measured from PC or Tier 1 NPCs.
If no maritime route,  $0.25 per 250nm Railroad shipping saved.

The use of shipping route length was to tie to a commercial value.
This gives a neutral basis for evaluating the value of the canal.
That also means canals built in places not of great mercantile value won't generate much revenue, even if militarily they are desirable.

Example : A canal across the Tayabasa ithmus linking the North and South parts of Luzon.  Useful militarily, not really useful in trans-Pacific trade.
Treating such as a concession would allow far more IC in that province than it could regularly hold. Making building the canal attractive and lucrative even if useless.
This is not an argument in favor in my mind.

Further, the current revenue rule was developed lposted prior to the Panama canal being built,
deciding to change the revenue generation at this juncture seems belated.

As for the distance saved, when the time comes, I will measure that out, and run it by Snip as Mod Emeritus to double check me.

[Jefgte]

Just a remark:

Rocky paid for the Panama Canal. If he has income from his commercial use, that's okay.

Jef did not pay for the Suez Canal, since it was already pierced.
No income.

[The Rock Doctor]

Very well, I'll await a decision.

[Kaiser Kirk]

Just a remark:

Rocky paid for the Panama Canal. If he has income from his commercial use, that's okay.

Jef did not pay for the Suez Canal, since it was already pierced.
No income.

Correct,
The rule was meant for canals built in the future.
Effectively, the Suez canal's economics is part of the Byzantine Empire's Startup IC.

...oh a lovely world if that didn't exist pregame....

Rocky has put sustained and large effort into the Panama canal,
and so will get the additional economic rewards.

[TacCovert4]

Well, it's 11,000 nm from one end of the canal to the other, the long way, or close enough as makes no difference.  For shipping going from Europe to the Pacific or Pacific Coast of N. Erica/Central Erica, the Canal saves approximately 5000nm of distance traveled for looping around the Cape, each way.  Also means that smaller steamers can do the trip since you don't need the huge fuel reserves for that lesser developed bit of S. Erica, so overall traffic should increase drastically. 

[Desertfox]

That would come out to about ~$2.5 sounds a bit on the low end. Perhaps tweaking the rule to $0.5 per 1,000 saved? That would give a revenue of about $5, which sounds about right.

[TacCovert4]

I would say that you wouldn't have to change the rule.  Ships have to go both directions, so you're going to have 'round trip' distance savings of 10,000nm.

[Kaiser Kirk]

I rather like the round trip interpretation.

Adjusting such things doesn't effect the base concept tying it to commercial utility,
just ensures the reward is worthwhile.

And yes, between the completed canal, and the Parthian freeports serving as 'stepping stones' across the Pacific,
the Pacific should be a much more attractive shipping route. Likewise the canal should make West Mericas-> Europe better,
Or East Mericas->Asia.

[Desertfox]

A round trip of 10,000nm at $0.25 only gives a profit of $2.5, which i believe is way too low, hence my suggestion of bumping up the profit to $0.5 per 1000nm.

[TacCovert4]

Well, that or you could look at the complete available routes.  The canal saves 10,000nm on the round trip from Europe to Asia/Pacific.  That route was still viable going through the cape.

However, the East-Coast of Ericas to West Coast, using NY to San Diego, was originally a 15,000nm route.  It's now 6000nm at best, a 9000nm savings each way.  Since this route would have simply not been viable prior to the canal, rather than using 'savings' per se, this new and lucrative route type (aka West Coast of the Ericas in general) could be denoted as a 6000nmx2=12,000nm 'trade route' because the canal's existence actually makes it exist in the first place.

So that would be a 10,000nm savings on existing trade routes, and a 12,000nm trade route that is new because of the canal, for 22,000nm in total for a total revenue of $5.5