Is marginal emission cost pricing enough to comply with the EU CO2 reduction targets?

From transport economic literature it is known that pricing (environmental) externalities can improve the efficiency of a transport system. However, in real-world politics, policy setting often follows so-called `backcasting' approaches where predefined goals are set, and policy measures are implemented to reach those goals. This study presents, for a specific case study, an parametric approach to identify the gap between toll levels derived from environmental damage cost internalization and toll levels from the goal to reduce global greenhouse gas emissions in the transport sector until 2020 by 20% (avoidance cost approach). For this purpose, the damage costs internalization is applied to a real-world scenario of Munich metropolitan area. The results indicate that the desired reduction in CO2 emissions is not reached. This parametric internalization approach with damage cost estimates from the literature yields toll levels that are by a factor of 5 too low in order to reach the predefined goal. When aiming at overall emission cost reductions by 20%, the damage cost estimates are even by a factor of 10 too low. Furthermore, it is shown that the major contribution to the overall emission reduction stems from behavioral changes of (reverse) commuters rather than from urban travelers; under some circumstances, the latter even increase their CO2 emission levels. Finally, the study indicates that there might be conicting trends for different types of pollutants, i.e. pricing emissions does not necessarily result in a reduction of all pollutant types

Active Transportation for America

In this era of traffic congestion, high gas prices, climate change, an obesity epidemic, and fiscal constraints, federal transportation funding has reached a critical crossroads.Decades of car-centered transportation policies have dead-ended in chronic congestion, crippling gas bills, and a highly inefficient transportation system that offers only one answer to most of our mobility needs -- the car.Investment now in a more diverse transportation system -- one that provides viable choices to walk and bike, and use public transportation in addition to driving -- will lead to a far more efficient use of transportation resources.Active transportation is the missing piece in our transportation system

The limits of technology: achieving transport efficiency in developing nations

Emissions from the transport sector represent the fastest growing source of greenhouse gas emissions. There is little prospect that this situation will be resolved with a single technological fix. As developing nations quickly move to catch up with the motorisation levels of developed nations, the sheer number of private vehicles on the roadways will overwhelm any advances made by cleaner fuels. By the year 2030, there is projected to be more vehicles in the developing world than in developed nations. However, most developing cities today still have the basis for a more sustainable future. Public transport and non-motorised transport (walking and cycling) still command a dominant share of travel in developing cities. Thus, a key objective for local and international initiatives is to preserve existing mode shares. Unfortunately, most investment in reducing transport emissions relies exclusively upon achieving costly reductions only through fuel and propulsion system technologies. Bogotá (Colombia) represents one of the best examples of a city that has developed a package of complementary measures to substantially reduce vehicle emissions and congestion. Bogotá’s implementation of a high-quality bus rapid transit (BRT) system, bicycle infrastructure, pedestrian improvements, car-free events, and auto restriction measures all have contributed to an urban transformation in a period of just a few years. Initial projections of greenhouse gas reductions during the first 30 years of the BRT system’s operation indicate reductions of approximately 14.6 million metric tons of CO2 equivalents. This research presents a framework for evaluating the greenhouse gas emission reductions in the transport sector. This framework highlights three principal areas of emission reduction potential: 1.) Mode share (behaviour); 2.) Distance travelled (land-use/design); and 3.) Fuel efficiency (technology). Only by addressing all three components an optimum transport energy path can be achieved

Distributional effects of road pricing: Assessment of nine scenarios for Paris

The starting point of this paper is to consider that there is no general answer to the question of the equity of urban road pricing. We therefore simulate and compare the distributional effects on commuters of nine toll scenarios for Paris, assuming that utility is nonlinear in income. We show that the distributional pattern across income groups depends crucially on the level of traffic reduction induced by tolling. Stringent tolls are more favourable to low-income motorists. Equity effects also vary with toll design. Compared to a reference scenario which uniformly charges all motorists driving within Paris, an inbound cordon toll is detrimental to low-incomes. Conversely, granting a rebate to low CO2 emission cars slightly improves their situation while an exemption for Paris residents is neutral. Surprisingly, it matters little for social equity whether toll revenues are allocated to all commuters or solely to public transport users.Road pricing, Distributional effects, Income effects, Equity

Effectiveness and welfare impacts of alternative polices to address atmospheric pollution in urban road transport.

n this paper we compare the effectiveness and welfare effects of alternative fuel efficiency, environmental and transport policies for a given urban area. The urban transport activities are represented as a set of interrelated markets, one for each mode of transport and type of vehicle. For each market, four different marginal external costs are computed in the present equilibrium: air pollution, accidents, noise and congestion. The gap between marginal social costs and prices shows that congestion and unpaid parking are the dominant sources of inefficiencies. Air pollution costs are significant as well. The effects of a typical air quality policy (regulation of car emission technology) and two typical fuel based policies (minimum fuel efficiency policy and fuel taxes) are compared with the effects of three alternative transport policies (full external cost pricing, cordon pricing, parking charges). Regulation of emission technology and of fuel efficiency do not necessarily lead to welfare gains, whereas transport pricing policies yield substantial gains for the urban area under study.

Effectiveness and Welfare Impacts of Alternative Policies to Address Atmospheric Pollution in Urban Road Transport

In this paper we compare the effectiveness and welfare effects of alternative fuel efficiency, environmental and transport policies for a given urban area. The urban transport activities are represented as a set of interrelated markets, one for each mode of transport and type of vehicle. For each market, four different marginal external costs are computed in the present equilibrium: air pollution, accidents, noise and congestion. The gap between marginal social costs and prices shows that congestion and unpaid parking are the dominant sources of inefficiencies. Air pollution costs are significant as well. The effects of a typical air quality policy (regulation of car emission technology) and two typical fuel based policies (minimum fuel efficiency policy and fuel taxes) are compared with the effects of three alternative transport policies (full external cost pricing, cordon pricing, parking charges). Regulation of emission technology and of fuel efficiency do not necessarily lead to welfare gains, whereas transport pricing policies yield substantial gains for the urban area under study.

A systematic review of the energy and climate impacts of teleworking

Information and communication technologies (ICTs) increasingly enable employees to work from home and other locations (‘teleworking’). This study explores the extent to which teleworking reduces the need to travel to work and the consequent impacts on economy-wide energy consumption. Methods/Design: The paper provides a systematic review of the current state of knowledge of the energy impacts of teleworking. This includes the energy savings from reduced commuter travel and the indirect impacts on energy consumption associated with changes in non-work travel and home energy consumption. The aim is to identify the conditions under which teleworking leads to a net reduction in economy-wide energy consumption, and the circumstances where benefits may be outweighed by unintended impacts. The paper synthesises the results of 39 empirical studies, identified through a comprehensive search of 9,000 published articles. Review results/Synthesis: Twenty six of the 39 studies suggest that teleworking reduces energy use, and only eight studies suggest that teleworking increases, or has a neutral impact on energy use. However, differences in the methodology, scope and assumptions of the different studies make it difficult to estimate ‘average’ energy savings. The main source of savings is the reduced distance travelled for commuting, potentially with an additional contribution from lower office energy consumption. However, the more rigorous studies that include a wider range of impacts (e.g. non-work travel or home energy use) generally find smaller savings. Discussion: Despite the generally positive verdict on teleworking as an energy-saving practice, there are numerous uncertainties and ambiguities about its actual or potential benefits. These relate to the extent to which teleworking may lead to unpredictable increases in non-work travel and home energy use that may outweigh the gains from reduced work travel. The available evidence suggests that economy-wide energy savings are typically modest, and in many circumstances could be negative or non-existent

A passenger-to-driver matching model for commuter carpooling: Case study and sensitivity analysis

For the transport sector, promoting carpooling to private car users could be an effective strategy over reducing vehicle kilometers traveled. Theoretical studies have verified that carpooling is not only beneficial to drivers and passengers but also to the environment. Nevertheless, despite carpooling having a huge potential market in car commuters, it is not widely used in practice worldwide. In this paper, we develop a passenger-to-driver matching model based on the characteristics of a private-car based carpooling service, and propose an estimation method for time-based costs as well as the psychological costs of carpooling trips, taking into account the potential motivations and preferences of potential carpoolers. We test the model using commuting data for the Greater London from the UK Census 2011 and travel-time data from Uber. We investigate the service sensitivity to varying carpooling participant rates and fee-sharing ratios with the aim of improving matching performance at least cost. Finally, to illustrate how our matching model might be used, we test some practical carpooling promotion instruments. We found that higher participant role flexibility in the system can improve matching performance significantly. Encouraging commuters to walk helps form more carpooling trips and further reduces carbon emissions. Different fee-sharing ratios can influence matching performance, hence determination of optimal pricing should be based on the specific matching model and its cost parameters. Disincentives like parking charges and congestion charges seem to have a greater effect on carpooling choice than incentives like preferential parking and subsidies. The proposed model and associated findings provide valuable insights for designing an effective matching system and incentive scheme for carpooling services in practice

Distributional effects of road pricing: Assessment of nine scenarios for Paris

International audienceThe starting point of this paper is to consider that there is no general answer to the question of the equity of urban road pricing. We therefore simulate and compare the distributional effects on commuters of nine toll scenarios for Paris, assuming that utility is nonlinear in income. We show that the distributional pattern across income groups depends crucially on the level of traffic reduction induced by tolling. Stringent tolls are more favourable to low-income motorists. Equity effects also vary with toll design. Compared to a reference scenario which uniformly charges all motorists driving within Paris, an inbound cordon toll is detrimental to low-incomes. Conversely, granting a rebate to low CO2 emission cars slightly improves their situation while an exemption for Paris residents is neutral. Surprisingly, it matters little for social equity whether toll revenues are allocated to all commuters or solely to public transport users

The correlation of externalities in marginal cost pricing: lessons learned from a real-world case study

Negative externalities cause inefficiencies in the allocation of capacities and resources in a transport system. Marginal social cost pricing allows to correct for these inefficiencies in a simulation environment and to derive real-world policy recommendations. In this context, it has been shown for analytical models considering more than one externality, that the correlation between the externalities needs to be taken into account. Typically, in order to avoid overpricing, this is performed by introducing correction factors which capture the correlation effect. However, the correlation structure between, say, emission and congestion externalities changes for every congested facility over time of day. This makes it close to impossible to calculate the factors analytically for large-scale systems. Hence, this paper presents a simulation-based approach to calculate and internalize the correct dynamic price levels for both externalities simultaneously. For a real-world case study, it is shown that the iterative calculation of prices based on cost estimates from the literature allows to identify the amplitude of the correlation between the two externalities under consideration: for the urban travelers of the case study, emission toll levels—without pricing congestion—turn out to be 4.0% too high in peak hours and 2.8% too high in off-peak hours. In contrary, congestion toll levels—without pricing emissions—are overestimated by 3.0% in peak hours and by 7.2% in off-peak hours. With a joint pricing policy of both externalities, the paper shows that the approach is capable to determine the amplitude of the necessary correction factors for large-scale systems. It also provides the corrected average toll levels per vehicle kilometer for peak and off-peak hours for the case study under consideration: again, for urban travelers, the correct price level for emission and congestion externalities amounts approximately to 38 EURct/km in peak hours and to 30 EURct/km in off-peak hours. These toll levels can be used to derive real-world pricing schemes. Finally, the economic assessment indicators for the joint pricing policy provided in the paper allow to compare other policies to this benchmark state of the transport system