World review of road pricing: Phase 2 - final report
Adobe Acrobat version
Executive summary
1. Introduction
1.1 Background to Phase 1 review
1.2 Phase 2 review background and objectives
1.3 Report structure
1.4 Acknowledgements
2. The growing need for road pricing
2.1 The role of road pricing in travel demand management
2.2 Recent developments in road pricing schemes
2.3 Road pricing policy in the UK
3. Worldwide progress of road pricing
3.1 Introduction
3.2 Current status of the case study road pricing schemes
3.3 Aims and objectives of scheme proposals
3.4 Policy rationale for proposals
3.5 Types of schemes being considered
3.6 Level of awareness and acceptance
3.7 Consultation
4. Benchmarking road pricing progress in the UK to the rest of the world
4.1 Why compare the UK to the rest of the world
4.2 Degree of interest in road pricing
4.3 Current status of emerging schemes
4.4 Policy framework
4.5 Legislative framework
4.6 Objectives of road pricing
4.7 Revenue from charging
4.8 Type of scheme
4.9 Road pricing and other measures
4.10 Awareness and acceptability
4.11 Overall conclusions
Case studies
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Executive summary
Background to Phase 2 of the World Review of Road Pricing
The Commission for Integrated Transport (CfIT) completed Phase 1 of a World Review of
Road Pricing in summer 2006. This looked in detail at 22 locations which had at that stage
implemented some form of pricing for road use.
Phase 2 of the World Review has extended this research to identify and examine emerging
Road Pricing schemes. These are schemes that are currently still at the stage of planning
and development and have not yet been implemented.
Objectives and Approach
The key objectives of the review were to:
- Identify geographical locations worldwide currently considering a Road Pricing scheme;
- Provide case studies, summarising the current status of political thinking and progress
on Road Pricing in these locations; and
- Examine where the UK Government's thinking on Road Pricing stands in relation to
these locations, including benchmarking where the UK stands in relation to the progress
being made on emerging Road Pricing schemes worldwide.
- The review was undertaken using desk-based research to identify a long-list of existing
Road Pricing schemes or emerging Road Pricing proposals outside the UK. A short-list
of 17 locations was selected as the basis for more detailed case studies. The research
involved reviewing available reports and information and interviews with transport
experts and policy-makers in the case study locations.
Definition of Road Pricing
Road pricing can, strictly, cover a wide range of means of paying for road use. This review
has focused on area-wide pricing schemes such as those implemented in London and
Singapore, rather than link-specific pricing as typically applied to toll-roads or bridges.
The Role of Road Pricing in Travel Demand Management
Phase 1 of the review concluded that locations that had implemented Road Pricing had done
so primarily to: control rising congestion levels; deter further growth in car use; and to
address the negative impacts of traffic and congestion on transport efficiency and the
environment. Some of the cases highlighted in Phase 1 demonstrate how successful Road
Pricing can be as a travel demand management measure, notably:
- In Singapore where Road Pricing has been operating successfully since 1975 (with
Electronic Road Pricing (ERP) introduced in 1988). The ERP scheme reduced traffic in
the area by around 13% and increased average speeds by up to 20%;
- In London, where the Central London Congestion Charging scheme has been
successful by reducing traffic in the central London charging zone by up to 16% and
congestion by up to 30%. A western extension to the existing charging zone is to be
introduced in early 2007;
- In Stockholm where a six month trial of Road Pricing ended in July 2006 with a
referendum on the potential implementation of a permanent scheme held in September
2006. Overall, 51% of residents of the Stockholm area voted in favour of a permanent
Road Pricing scheme, though the level of support varied between city and suburban
areas; and
- In Trondheim, Norway, where a Road Pricing system operated between 1991 and 2005
and reduced traffic by up to 10%.
Progress on Road Pricing in the UK
The UK would appear to be at the forefront of the continuing evolution and development of
Road Pricing for a range of reasons:
- The successful implementation of Road Pricing schemes in London and Durham;
- The completion by the Department for Transport (DfT) of a Feasibility Study in July 2004
examining how a new system of charging for road use could help make better use of
road capacity; and
- Research and development into Road Pricing funded by DfT both on a local and
national level through projects such as DIRECTS and most recently the Transport
Innovation Fund (TIF) which has supported the planning and development of Road
Pricing schemes by local authorities.
Progress on Road Pricing Worldwide
The number of locations where some form of Road Pricing scheme has recently or is
currently being considered is large. It would appear that a very wide range of locations,
including towns and cities in nearly every continent and of different sizes of urban area, now
have Road Pricing on the agenda as a tool for addressing transport issues.
National Road Pricing Schemes
Only two emerging Road Pricing schemes can be considered as national in their proposed
coverage - those for England (as set out in various DfT policy statements) and the
Netherlands.
Neither of the two schemes can be considered committed.
There is no definite proposal for a national scheme in England and the UK - though a study
of the feasibility of such a scheme was undertaken by the DfT in 2004.
In the Netherlands, while plans are more developed, there is also no firm commitment to
implementation. It is noted that partial national schemes already exist in Germany, Austria
and Switzerland in the form of lorry road user charging schemes, with the Czech Republic
and Slovakia also expected to implement lorry charging schemes.
Local Road Pricing Schemes
The remaining Road Pricing schemes identified may be viewed as local, focusing on a single
town, city or urban area. These represent the vast majority of emerging Road Pricing
schemes identified.
Current Status of Emerging Schemes
There are no new emerging schemes which are expected to be implemented imminently
anywhere in the world. Short-term expansion of Road Pricing is limited to changes to those
schemes already identified in the Phase 1 review as operational plus, potentially, a new trial
scheme. These comprise:
- London, with an extension to the current scheme due to become operational in 2007;
- Stockholm - which at the time of the Phase 1 review was being trialled and following the
results of the September 2006 referendum is currently considered likely to re-start in
2007; and
- Milan - where it has recently been announced that a trial scheme focused on the city
centre is to be introduced in early 2007, though full details are limited.
Schemes identified in all other locations appear to be some way off implementation with their
status ranging from very outline concept - the vast majority of emerging schemes identified
- through to a broadly defined implementation plan even though, in some instances,
aspirational implementation timescales seem bold. Additionally, none of these emerging
proposals appear to have the necessary legislative frameworks in place to enable them to be
implemented imminently.
There is therefore a substantial gap between the status of existing operational Road Pricing
schemes and the sizeable pack of emerging schemes.
This gap is also evident in the development of Road Pricing schemes in the UK where local
schemes being developed under TIF are currently only at an outline planning stage. While
the UK has clear advantages over many other locations in developing Road Pricing
schemes, for the reasons noted above, there is no evidence to suggest that the UK is forging
ahead in delivering new Road Pricing schemes compared with the rest of the world.
Equally, there is no evidence to suggest that other countries and locations are themselves
forging ahead with Road Pricing at a pace faster than that in the UK.
The only exception to this is the Netherlands which is at a more advanced level in
progressing national Road Pricing than in the UK, though there remains no firm commitment
to implement the scheme and the scale of a national scheme in the Netherlands is very
much smaller than that for a national scheme covering England. Additionally, it would appear
that the planning of the national Road Pricing scheme in the Netherlands has suppressed
the development of local schemes - such as those that at one stage were being considered
in Rotterdam and The Hague.
Key Attributes of Emerging Road Pricing Schemes
Policy Framework
The evidence from the case studies shows that the majority of the emerging world Road
Pricing schemes are framed by local and/or regional policy but not national policy. Again,
the exception to this broad conclusion is the Netherlands, where the policy framework for the
national scheme is set at a national level.
Within England, a national policy framework does exist to promote the development and
eventual implementation of local Road Pricing schemes that is embedded within regional
and local policies and plans. In terms of interoperability the UK is in a strong position by
developing a framework for local schemes in England to operate under. This is intended to
enhance usability and interoperability and act as precursors to a national scheme. Norway
is the only other location that has operated a number of local schemes in a similar way.
Across the case studies it is reasonable to conclude that the English national policy
framework to develop and implement Road Pricing schemes at a local level in a way that
addresses issues of interoperability between locations is unique.
It is apparent from all the case studies for locations that are advancing local Road Pricing
schemes that, in general, responsibility for planning and delivery of the scheme lies with a
single authority. Contrasting this with emerging schemes in England suggests that many of
the schemes that may emerge from authorities granted TIF pump-priming funding will need
to cover multiple planning authorities.
There is also a wider issue in terms of control and deliverability of complementary public
transport measures that may be critical to the acceptability and implementation of Road
Pricing. Most of the authorities in locations worldwide that are considering Road Pricing
schemes have more direct control and influence over their public transport systems than do
the authorities currently progressing local Road Pricing schemes in England - excluding
London.
Legislative Framework
In all the emerging schemes examined, new legislative powers are still required in order to
implement Road Pricing schemes.
In the UK, implementation of a national scheme would still require new legislation. However,
the Transport Act 2000 does provide local authorities with the necessary powers to
implement Road Pricing schemes subject to Secretary of State's approval. The ability to
implement emerging local Road Pricing schemes in England is substantially greater than in
other locations worldwide.
Objectives of Road Pricing
The evidence from the case studies shows that most of the emerging Road Pricing schemes
have multiple objectives, though with tackling congestion as the primary objective in all but
one of the cases. The majority of the emerging schemes also define objectives to tackle
problems of poor local air quality and address climate change with a smaller set also
identifying an objective to sustain their economies and improve the urban environment.
Eight of the case study locations also explicitly identify using Road Pricing to raise funds to
reinvest in transport.
Only two of the case studies have evidence that one of their objectives is to use Road
Pricing revenues to modify the current means of road use taxation; the Seattle local scheme
and the Netherlands national scheme.
In contrast, Road Pricing in the UK has the very clear primary objective of tackling
congestion. While congestion clearly does impact on emissions and the economy this very
exclusive focus on reducing congestion as the primary objective does make the approach to
local Road Pricing schemes in the UK (outside London) stand out from the emerging
schemes elsewhere in the world. While there is recognition that Road Pricing schemes can
raise revenue to reinvest in the transport system there is, in England, no explicit recognition
of this as an objective of introducing Road Pricing.
Revenue from Charging
Given that most of the emerging schemes are at an early stage of development, details of
how revenues derived from Road Pricing might be used are not firm. However, none of the
emerging local Road Pricing schemes are expecting to be revenue or fiscally neutral. All
schemes expect to generate net revenues from charging.
There is evidence that the Netherlands national scheme would seek to modify the taxation
regime to shift the basis of charging for road use from car ownership to car use.
Across the other emerging Road Pricing schemes the vast majority of the case studies plan
to use net revenues from charging to improve local transport in the urban area within which
the Road Pricing scheme would operate, with certain locations proposing to utilise revenues
to fund specific infrastructure projects including road schemes.
Type of Scheme
There are few firm commitments to scheme type in terms of charging area, charging period
and technology across the emerging schemes.
There is no definitive scheme type yet established for the Netherlands national Road Pricing
scheme though the expectation is that it will comprise a distance-based charge using a
GPS-based system. To an extent this mirrors the position in the UK where there is no firm
idea of charging type and system other than a broad recognition that some form of distancebased
charge is required. However, the evidence shows that the Netherlands is actively
researching and considering scheme specifications with a view to being able to take political
decisions on scheme type in 2007. The Netherlands is also linking technology availability
and cost to its decision-making process on when to implement Road Pricing by monitoring
system costs.
At the local level, the emerging Road Pricing schemes identified do represent a broad
spectrum of different locations and issues. Most of the local schemes are considering
cordon or area-licence solutions. In all instances where area-licence solutions are being
considered so also are cordon-based solutions. Only three of the case studies identify
distance-based solutions, including London, as a long-term option. Broadly, this is
consistent with the approach being adopted by the authorities in the UK developing schemes through TIF: looking at area-licence and cordon schemes but with distance-based charging
as a longer term option.
The level of charge being considered in the majority of the worldwide locations is low relative
to the levels charged in London or charge levels conceived in many of the studies on Road
Pricing options in the UK. It is difficult to draw too many conclusions from this since charges
need to be seen alongside the motoring costs prevalent and the level of planning and
analysis that has been undertaken in each case study area.
Road Pricing and Other Measures
The evidence from the case studies overwhelmingly indicates that Road Pricing is being
considered alongside a package of other measures to improve the transport system. For the
vast majority of case studies this explicitly includes public transport. However, in certain
locations measures include other demand management and highway network schemes.
Broadly the approach being followed on TIF in England is consistent with this.
Awareness and Acceptability
The experience of London and now Stockholm clearly shows the importance of public and
stakeholder acceptability in successfully implementing Road Pricing schemes. Measuring
the extent of awareness and support of schemes examined by the case studies is difficult
and the evidence inconclusive. There is no evidence to suggest that there is overwhelming
support for Road Pricing in any of the locations examined or that any of these locations are
more advanced than the UK. The possible exception to this is Stockholm, where the results
of the recent referendum do indicate overall support for the Road Pricing scheme.
Overall Conclusions
This review has identified that a wide range of locations worldwide are now considering
implementing local Road Pricing schemes, but only the Netherlands and the UK are looking
at national schemes.
The evidence indicates that the majority are at very early planning stages with very few
having clear specifications of schemes. Other than locations that are extending or modifying
schemes already in existence or proposing trials - there are no committed implementation
plans across the sites reviewed.
The evidence indicates that most locations are developing local schemes on a bottom-up
basis, not framed by wider national policy or backed up by legislation that would enable
Road Pricing to be implemented. The exception to this is the Netherlands which does have a
national framework supporting the development of its national scheme.
In contrast, the UK does have a national policy framework that is guiding the development
of interoperable local Road Pricing schemes and does have legislation that would enable
Road Pricing schemes to be implemented. Importantly, the longer-term aspiration for a
national scheme is not hindering the progression of local schemes. The DfT is also providing
funding to enable the development of Road Pricing schemes in England.
However, compared with other locations in the world the authorities in England progressing
with Road Pricing schemes have limited ability to shape the public transport elements of an
integrated package of measures to complement Road Pricing.
It is clear that the primary focus of Road Pricing in the UK is to tackle congestion, while the
majority of schemes worldwide explicitly seek to achieve a wider range of objectives. As
Phase 1 concluded, this single-objective focus was important in gaining public acceptability
for schemes that have been implemented but there may now be a case for expanding the
stated range of objectives Road Pricing can address.
England, with two operational schemes, has a clear advantage in demonstrating the benefits
and feasibility of Road Pricing and gaining public acceptance. However, in most other
respects local Road Pricing schemes outside London in the UK are at a similar stage of
planning and development as elsewhere in the world.
Thinking on scheme design and technology in the UK also appears to be consistent with that
of emerging Road Pricing schemes worldwide. However, the planning of a national scheme
in the UK appears to be behind that in the Netherlands where, although there is no firm
implementation date, progress is being made with the identification of options and
engagement with stakeholders.
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