[sustran] European Transport Pricing Initiative Newsletter

[Todd Litman]

Pricing Urban Transport


Welcome to the first issue of the European Transport Pricing Initiative
Newsletter!

Issue No. 1, December 2000



Road User Charging - The Solution? 
Road pricing is one of the key issues to be addressed in European
transport. It could prove to be an important tool in achieving a reduction
in urban road traffic and associated environmental nuisance, but there may
be problems of public and political acceptance. International case studies,
e.g. in Singapore and Hong Kong, have shown that acceptability is greater
where the revenues are seen to be clearly fed back into developing public
transport and road systems. 

The European Commission is supporting a number of major research projects
on transport pricing in an effort to compile a body of practical
information and guidance which will assist public authorities in planning,
implementing and operating successful transport pricing schemes. 

 

Europe's Sounding Board on Transport Pricing 

The European Transport Pricing Initiative (ETPI) will act as a forum for
the latest research, debating and consensus-building activities in urban
transport pricing. The principal focus of ETPI is currently the eight
cities involved in the four-year PRoGRSS project and CUPID, which will
support the PRoGRSS cities and undertake cross-city evaluation studies.
However, other projects, such as EUROPRICE
(http://www.europrice-network.org), which provides a political platform,
and other initatives and networks are encouraged to interact with and
contribute to the forum. ETPI will make use of various media, of which this
biannual newsletter is just one. Position papers, a website
(http://www.transport-pricing.net) and other sources of information will
also be used. 

****************

CUPID _ At the Heart of the Matter

The CUPID project consortium will provide the cities with practical advice
on selecting, designing, implementing and monitoring road pricing
strategies. It will also have the task of preparing an in-depth assessment
of all eight schemes, including: 

* user response and acceptance 
* enforcement 
* financial feasibility 
* institutional settings 
* privacy and technical aspects linked to infrastructure and equipment 
* the wider impacts on EC policy 
* social and economic effects 
  

This will be used as the basis for a set of policy recommendations for
implementing transport pricing schemes in urban areas. It will be aimed at
assisting local/regional authorities in the development of such strategies
as well as influencing policy development at national and EU levels.

CUPID will make a major contribution to the European/international debate
on urban transport pricing policy options. It will disseminate progress
updates and results from the demonstration sites, as well as the
conclusions of the thematic network experts. 


The CUPID project team comprises research organisations and policy advisors
from the UK (TTR), Italy (ISIS), Germany (TUD), Norway (SINTEF) and
Portugal (TIS.pt). 

Further information on CUPID is available from Jo Baker at Transport &
Travel Research Ltd, tel: +44 (0) 1543 416416, fax: +44 (0) 1543 416681,
email: ttr at compuserve.com

****************

Making PRoGRSS 

Eight cities across Europe - Rome, Trondheim, Edinburgh, Copenhagen, Genoa,
Gothenburg and Helsinki and Bristol - will spend the next four years
developing and implementing a range of road pricing concepts and
technologies as part of the PRoGRSS project. The project aims: "to
demonstrate and evaluate the effectiveness and acceptance of integrated
urban transport pricing schemes to achieve transport goals and raise
revenue". 

The cities will work with key groups to develop and assess the political,
economic and social framework required for implementing urban transport
pricing schemes. Their approach will be firmly practical as they explore
issues which have tended in the past to be neglected by researchers. These
include the social acceptance of road user charging schemes, as well as
their effectiveness in achieving environmental and revenue raising
objectives. The project also aims to develop good practice guidelines for
electronic road pricing equipment and concepts. 

Commenting on the project, Councillor Helen Holland, Executive Member for
the Environment, Transport and Leisure at Bristol City Council (UK) said,
"The key to success in this field is to explore public opinion and to
design schemes which will serve the needs of business and residents. The
public needs to see the benefits in real terms _ better public transport
and a cleaner, safer environment. We welcome the involvement of PRoGRSS as
it is taking very positive steps to tackle these issues." 

Further information on PRoGRSS is available from Barbara Davies at Bristol
City Council, tel: +44 (0) 117 903 6709, +44 (0) 117 903 6540, email:
barbara_davies at bristol-city.gov.uk


****************
Road Pricing - Frequently Asked Questions

There are three critical issues which cities need to address early on in
the development of road pricing projects: 

a) Where will the finances come from to cover the set-up costs? 

b) How do we achieve public acceptability of road pricing?

c) How should we assess and evaluate the impacts of road pricing projects?

Brief answers are provided below. More detailed answers to these and other
questions will be included on the project website
http://www.transport-pricing.net. Other questions may be answered in future
newsletters; please contact the CUPID co-ordinator if there are issues you
would like to see addressed. 

A. How do we achieve public acceptability of road pricing?

The challenge for the city authority of implementing an urban pricing
project, which is acceptable to the transport user, is considerable. People
regard public roads as "free" goods and any attempt to charge for this
commodity needs to overcome strong emotional resistance. The 6 issues below
need to be addressed if resistance is to be minimised and confidence in
urban pricing as a fair and effective means of achieving positive benefits
is to grow.

a) Both politicians and the public must understand the urgent need to find
solutions to traffic problems in cities. Transport pricing needs to be
_sold_ as an effective and appropriate solution and the messages used to
promote marginal cost pricing should focus on the social and environmental
benefits, e.g. improved air quality, reduction in congestion and increased
safety. 

b) The public needs to be aware that their travel behaviour has a key role
to play in achieving the benefits listed above. The city authorities
therefore need to understand the values as well as the expectations of the
transport users. This is true throughout the duration of the project, but
particularly early on. A crucial phase is when transport users adjust their
behaviour for the first time. It must be clear to them that their attempts
to support commonly shared values are having an effect. 

c) Revenues must be allocated in advance to funding alternative modes of
transport. The concepts of traffic restraints and road charging will be
much more acceptable if combined with transport and environmental
improvements. The availability of high quality alternatives to the private
motor car will help achieve lasting changes in travel behaviour.

d) The charge level and the amount to be re-invested in public transport
need very careful consideration. In a cost-benefit-analysis of the scheme
the individual should perceive that the financial burden imposed by the
pricing initiative is, at least, balanced by the benefits they are gaining.
In addition, individuals should feel that they are being treated equally in
comparison with others. Hypothecation of the revenues should result in a
guaranteed level of mobility for all. Indeed it may be biased towards some
disadvantaged groups thereby supporting equity amongst the population. 

e) Public acceptability comes from confidence in the effective operation of
the scheme, the use of the revenues and the fairness and anonymity of the
system. Right from the start, it should be clear to the public who has
overall responsibility for the scheme, for its design and implementation,
for charging and accounting, for revenue allocation - and for defects and
deficiencies. Commitment will be reinforced through early and credible
communication, as well as positive experiences of the system in operation.

f) A communications strategy comprising a series of intelligent and focused
PR activities, which gets underway at the initial stages of the project is
imperative if public acceptance and adoption of the scheme are to be
achieved. 


B. Where will the finances come from to cover the set-up costs?

The costs of establishing a road user charging scheme are considerable and
include the expense of infrastructure and personnel as well as lead-in
costs whilst the scheme is being developed, such as public consultation,
media campaigns, and legal/planning costs.

Given the sensitivity of the issue, it is advisable for the local authority
to be seen to control any scheme and to closely regulate private sector
input. There are a number of ways, however, in which the private sector can
be encouraged to contribute to the scheme and help offset set-up costs:

Option 1: Full Public Private Partnership 
The local authority and private company establish a separate, joint entity
which will both implement the road pricing scheme and develop complementary
measures such as public transport schemes. However it is unlikely to be
acceptable socially until the concept of road pricing is well established.
A further concern is that the private sector partner, as beneficiary of the
tolls collected, may promote the use of the private car in order to
maximise revenues.

Option 2: Partial Public Private Partnership 
This is a more acceptable approach in which the local authority administers
the overall scheme and the private sector invests in selected elements and
benefits from the revenues raised. For example, the road pricing scheme
could be privately developed and leased to the local authority at a fixed
rate. The income would cover the leasing costs and subsidies for an
improved private-public transport system. The disadvantage is that the
private sector will be less likely to accept risk transfer where it has
less control over the revenue stream.

Option 3: Privately financed publicly operated scheme
In this more conventional approach, the local authority develops the scheme
on its own initiative and raises private finance to support identified
elements of the overall scheme such as the road pricing system and the
public transport scheme, which may be delivered by different contractors.
Once again, care needs to be taken to make sure that private sector
partners are not encouraged to promote car travel by ensuring that toll
revenues go directly to the local authority.

Option 4: Public sector investment
A road pricing scheme will incur significant start-up costs before it
becomes viable. Only when these costs are met will any operating surplus be
released to support infrastructure investment. A publicly funded approach
might be acceptable in a city like Singapore, but is less appropriate in a
major European city where road pricing strategies need to be underpinned by
investment in transport infrastructure. Only by introducing a low level fee
to raise revenues for the development of infrastructure and increasing fees
to a level capable of demand management once infrastructure is in place
might this become a viable option.
 

C. How should we assess and evaluate the impacts of road pricing?
Road pricing for transport is expected to have a substantial impact on many
aspects of the urban area. Many of these impacts are complex and
interlinked. Major benefits will be anticipated by some stakeholders in
terms of environmental improvements, whilst others will be concerned about
the impact of pricing on economic performance.

The CUPID team is developing a generic framework for the evaluation of
urban pricing schemes to be published later this year. It will be applied
in the 8 PRoGRSS cities, and will be refined during the life of PRoGRSS,
benefiting from the feedback of local experts and the experience of
implementation. A final version of the framework will be re-issued towards
the end of the CUPID project. Both versions will be made freely available
on http://www.transport-pricing.net.

The framework will cover a comprehensive range of issues including
  
* acceptance 
* capacity 
* transport patterns 
* quality of service 
* resource consumption 
* pollution/nuisance 
* safety 
* costs 
* time 
* regional development 
* health 
* employment 
* legal Impacts 
* assessment/evaluation

The framework has been developed according to the MAESTRO GUIDELINES, which
were developed with EC support, to provide a multi-sector generic set of
guidelines for the assessment of transport pilot/demonstration projects.
The guidelines can be downloaded from http://www.europrojects.ie/maestro.

****************

PRoGRSS - One project, eight cities 

The eight PRoGRSS cities are each at various stages of development, but by
co-operating and using the project network to transfer information and
experiences, are looking forward to making rapid progress. The stage of
development of each of the cities is shown in Figure 1 below. A short
description of each city follows. 

Figure 1 _ Status of PRoGRSS cities with respect to urban road pricing

Bristol (UK)
Bristol is at the leading edge of assessment of road pricing and financing
strategies in the UK. A number of pilot studies have already taken place,
along with extensive consultation. Building on this political foundation
the city will be seeking to implement a full pricing system for the centre
of the city.

Copenhagen (Denmark)
Copenhagen is at the stage of initiating debate on the urban pricing
concept and aims to use the demonstration in PRoGRSS as the basis for
developing this debate. The demonstration will use Global Navigation
Satellite Systems (GNSS) based pricing technology to demonstrate a number
of pricing strategies with 500-1000 users paying real fees. 

Edinburgh (UK)
Edinburgh has been carrying out the hearts and minds exercise with regard
to urban road pricing for sometime. They are now developing initial scheme
ideas and assessing potential operational frameworks. During PRoGRSS they
aim to develop this issue further and build up public and political
commitment to the concept leading to a trial of the initial concept.

Genoa (Italy)
Genoa, like Rome, has existing access control in its historic centre. The
work carried out in a previous European funded project has provided a sound
understanding of the pricing regimes that could be used to further control
traffic in this historic core. PRoGRSS will demonstrate some of these
strategies and stimulate debate around a wider pricing concept for the city.

Gothenburg (Sweden) and Helsinki (Finland)
Gothenburg and Helsinki will be developing and modelling a number of
pricing strategies that could be used in their cities. Gothenburg will
complement this with a pricing scheme demonstration using pricing
technologies based on GNSS.

Rome (Italy)
Rome has an existing access control area which requires payment for annual
permits. A system of electronic enforcement is already in place. This
electronic access control system provides the basis for a pricing system to
be realised in the centre of the city.

Trondheim (Norway)
Trondheim has probably more practical experience of road pricing than any
other city in Europe. The city_s initial toll ring was established in 1991
and developed further in 1998. The initial focus was on the promotion of
road pricing evaluation of an electronic ticketing system and the city is
now building on its experience to use the system for demand management,
integrating the tolling system with the public transport and parking
payment systems.


Scrutinising the Options 
Table 1 shows a matrix of the potential pricing concepts and technology
combinations that will be trialled in each of the cities.

Table 1 _ Pricing concepts and technologies across the PRoGRSS sites

  
Scheme concept
Road pricing technology basis

Paper based

Electronic tag

Video

Global Navigation Satellite Systems (GNSS)

Cordon (per trip)

Zone (per trip)
  

Time based

Distance based


The most basic concept is a pricing cordon where vehicles are charged per
trip across the cordon boundary. This can be further developed into a zone
system where each trip across a zone boundary is charged. These charges may
vary according to times of day and different vehicles or user types. This
kind of concept is being used in Trondheim, Bristol, Edinburgh, Rome and
Genoa.

An alternative is to charge vehicles in line with the time spent or
distance travelled in the charging area. Again this charge can be
differentiated according to the time of day or user. Rome is looking at
this concept through its closed access control system and Copenhagen will
also analyse this type of charging through its GNSS system.

The technologies that can be used range from paper based systems with
manual enforcement through electronic based systems to GNSS systems. A
system using radio-based tags with smart card payment is considered the
current state of art however GNSS systems may provide a more flexible
solution in the near future. All these systems are being trialled. 

By working through a range of cities at different stages of development,
PRoGRSS will provide a strong basis for demonstrating and evaluating a
range of innovative pricing concepts and technologies.

****************

Are you a legal expert??

For our next EPTI-workshop in April 2001 we are looking for legal experts
in the area of road pricing. Are you an expert in this area or do you know
somebody who is? Are you interested in sharing knowledge and have
discussions in your area with cities and researchers? Then please contact
Manolo de la Fuente, e-mail: cupid at tis.pt

****************

This newsletter is produced as part of the European Transport Pricing
Initiative (ETPI). ETPI acts as a forum for the latest research, debating
and consensus-building activities in transport pricing and will track
developments in the 8 PRoGRSS cities and the CUPID thematic network. The
Initiative is funded by the European Commission. 

For further information on ETPI or CUPID, contact Jo Baker at Transport &
Travel Research Ltd, tel: +44 (0) 1543 416416, fax: +44 (0) 1543 416681,
email: ttr at compuserve.com

Further information on PRoGRSS is available from Barbara Davies at Bristol
City Council, tel: +44 (0) 117 903 6709, +44 (0) 117 903 6540, email:
barbara_davies at bristol-city.gov.uk

For subscribing or un-subscribing to this newsletter via e-mail, new ideas
and interesting tips for the next newsletter, please contact Manolo de la
Fuente at TIS.pt, tel: +351 (21) 359 30 20, fax: +351 (21) 359 30 21,
e-mail: cupid at tis.pt. We like to thank IMAGITA Newsletter (mail at imagita.dk)
for its help. 

For more information on CUPID, PRoGRSS and transport pricing issues, visit: 
http://WWW.TRANSPORT-PRICING.NET


Sincerely,

Todd Litman, Director
Victoria Transport Policy Institute
"Efficiency - Equity - Clarity"
1250 Rudlin Street
Victoria, BC, V8V 3R7, Canada
Phone & Fax: 250-360-1560
E-mail:  litman at vtpi.org
Website: http://www.vtpi.org