What are the Health Benefits of Congestion Pricing?

Congestion Pricing, Air Pollution, and Urban Health (11 page pdf, Emilia Simeonova, Janet Currie, Peter Nilsson and Reed Walker, American Economics Association Meeting, Chicago, Jan. 2017)

Also discussed here: Driving Fee Rolls Back Asthma Attacks in Stockholm (Nala Rogers, Inside Science. Feb. 2, 2017)

Today we review research on the impact of the introduction of congestion pricing in Stockholm, in 2006, and the reduction of traffic that followed on the health of children in that city. Pollution levels in that city are lower than EPA’s standards. Results indicate that the pricing system caused a drop in traffic volumes by 25%, reductions in NO2 and particulate (PM10) pollution of 5 and 10% and a reduction in asthma cases by 12% in the first  seven months which increased to 45% over the longer term (several years). While the benefits in other cities with fewer diesel vehicles (emitting PM) may not be as great, it is clear that there are benefits even when the air quality in a given city (such as Ottawa) is considered “good” and that there are negative health impacts that begin at lower thresholds than EPA standards project.

stockholm-congestion-health

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How do Travel Demand and Economics Affect the Development of Urban Road Networks?

A Model of the Rise and Fall of Roads (33 page pdf,  Zhang, LeiLevinson, David M, Systems Symposium at the Massachusetts Institute of Technology, Mar. 2004)

Today we review a seminal paper from over a decade ago that examines the dynamics of road development in a major mid-West American city (Minneapolis-Saint Paul) using a model that combines measures such as travel demand statistics (usually found on Origin Destination studies) with the economics of road pricing or tolls, geographical constraints (such as rivers and mountains) and how these change with newer technology over time (in this case over 20 years). Roads represent both figuratively and physically the link that join the issues addressed in this blog: how traffic is linked to pollution and how pollution is linked to health. Of particular interest is the way that travel demand and road volume capacity (VC) interact with road tolls and the cost of road construction and the resulting revenue that may be used to ease congestion, in addition to the overall design of the road network and design for a major urban area.

road-links

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How well did London’s Congestion Charge Perform?

London Congestion Pricing – Implications for Other Cities (5 page pdf, Todd Litman, CESifo DICE Report 3/2005, Mar. 2005)

Today we review a paper that assessed the performance of the London Congestion Charge after it had operated for 2 years. The winners include bus and taxi users, pedestrians and cyclists  and motorists with high value trips and most city centre businesses with congestion delays reduced reduced by 50% and net annual revenue of 97 million UK pounds to support transit/pedestrian and cycling infrastructure. Losers include motorists with marginal value trips and riders and motorists in border areas who a 10% increase in  spillover traffic (but no more delay because of proactive action to adjust traffic signals).  The London congestion charging system was a first for Europe and probably stimulated similar initiatives in Stockholm, Sweden Trondheim, Norway and Singapore in Asia.

london-cong-ch

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A Congestion Charge for Downtown Toronto: An Analysis

Revenue Options Study: Cordon Congestion Charges (185 page pdf, KPMG for City of Toronto, Jun. 2016)

Also discussed here: Report lays out hundreds of millions in potential new tax dollars for Toronto (Jeff Gray, Toronto Globe and Mail, Jun. 21, 2016)

Today we review a report by KPMG for the City of Toronto in which the option of a morning rush hour congestion charge is considered in the Toronto downtown south of the 401 between Bathurst and Bayview. Another road pricing option:applying a toll on the Don Valley Expressway is not included in this study and is being considered separately. A daily charge of $5 to $20 at each cordon would yield up to $377M/year in net revenue with 33% overhead. This in turn would cost the average household in Toronto $120 /year with 35% of the revenue coming from visitors.

The overall conclusion: “In general, a cordon charge would have a positive impact by reducing traffic, decreasing greenhouse gas emissions and increasing transit ridership.” and “The net revenue from cordon charges should have a high degree of stability in the long-term.” Implementation costs for congestion charges are high enough to consider as well the option of increasing parking rates in the downtown which would bring in similar revenues (and this seems to be favoured by the Mayor).

English: Toronto Downtown Core, at nite from C...
English: Toronto Downtown Core, at nite from CN Tower. (Photo credit: Wikipedia)

 

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All about Carbon Pricing: Carbon Tax? Cap and Trade?

Putting a Price on Carbon: A Handbook for U.S. Policymakers (56 Page pdf, Kevin Kennedy, Michael Obeiter, And Noah Kaufman, World Resources Institute, Apr. 2015

Today we review a handbook to implement carbon pricing– either by tax or by cap and trade– in the USA. Among the points noted were that a low to moderate tax alone would be “highly unlikely” to meet the UN’s goal of keeping global warming to less than 2 C (as recommended by 195 states at COP21 in Paris). Technological innovations subsidized by government are also needed and these can be funded from carbon tax revenue as well as other benefits such as tax cuts, return of money to households and electric users, and helping those directly harmed by carbon taxes as well as reducing national debt. Canada and the USA are well behind Scandinavian countries (such as Denmark, Finland, Norway, and Sweden, beginning in the early 1990s)  to establish a national carbon tax, although at the sub-national level,  California and Western states, British Columbia, Alberta, Ontario and Quebec have started to price carbon in recent years. Another interesting point is that a moderate carbon tax of $28/tonne applied to the USA would impact low income earners by 2.5% (and high earners by only 1%). This identifies the need to neutralize the regression effects by subsidizing the low income group by this amount.

carbon pricing basics

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What are the Best Incentives to Buy an Electric Car?

Incentives for promoting Battery Electric Vehicle (BEV) adoption in Norway (12 page pdf, Kristin Ystmark Bjerkan, Tom E. Nørbech, Marianne Elvsaas Nordtømme, Transportation Research Part d 43, ScienceDirect, Jan. 14, 2016)

Also discussed here: What are the most effective ways of promoting electric cars?  (Science for Environment Policy, European Commission, Apr. 22, 2016)

Today we review research on which incentives are the most effective in selling battery electric (BEV) cars based on a survey of Norwegians. The survey analysis considered low and high income levels, the differing impacts of reduced (or subsidized) cost at purchase to ongoing costs and benefits such as exemption from tolls. The typical Norwegian owner of an e-car is male, aged 36-55, high income, university education and living in the capital (Oslo). The single biggest factor was the initial purchase price (with discounts), followed by (exemptions from) congestion or road pricing, followed by free access to bus lanes. This supports the tactics used by governments in countries, such as Canada, in offering significant discounts for new e-car purchases and less emphasis on using exemptions from road tolls (even though road pricing is much less used and there are far fewer electric cars on the road in this country compared to Norway).

ecar incentives

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What are the Overall Benefits of Road Pricing beyond Revenue Generation and Congestion Management?

Next Generations of Road Pricing: Social Welfare Enhancing (15 page pdf, Omid M. Rouhani, Sustainability, Mar.11, 2016)

Today we review a paper that looks beyond the two factors often used to justify road pricing: raising cash and reducing traffic congestion. Some of those factors are public acceptability, equity and the fact that only 26% of the important factors are generic- much depends on local factors that differ from one location to another – which perhaps explains why congestion pricing (and carbon taxes for that matter) are overwhelmingly accepted in places such as Stockholm and British Columbia but vigorously rejected by the public in many US and Canadian cities.

Some of the implementation decisions involve the spillover of traffic from a tolled road to its neighbours (which supports the notion of tolling existing roads and not just new ones) and then need for alternatives to road use (i.e. walking, cycling, public transit) for those who need to travel and the need for flexibility in terms of the rate to be charged and finally the need to make clear at the onset the overall benefits or welfare to the travelling public.

road pricing welfare

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