How to Design Track Access Charges for Small Railways – A Montenegro Case Study

In 1991, the European Union decided on setting up a liberalized and single railway market. However, in the atomized European region, more than a half of railways can be designated as small railways. For the very reason of significant differences between the national railway systems, the EU legislation has laid broad grounds for track access charge (TAC) modelling, thus resulting in many different TAC models. Out of numerous papers in respect of TAC modelling, only a small number consider the specificities and the needs of small railways. The paper aims to answer the questions of how to design or set up an efficient TAC structure when it comes to small countries. Another objective is to answer how to develop a TAC structure allowing the infrastructure manager to manage its costs. The answers to these questions are provided through the case study of railway in Montenegro – small railways in the Western Balkans. The main contribution of this paper is on developing the TAC model based on the efficient ratio of the capacity and infrastructure wear and tear components.