Road pricing in practice Jan Owen Jansson

Road pricing cost and revenue in four cities and possible cost drivers

Automatic registration and identification at a control station along the cordon of the Stockholm congestion charging zone (Source:

Diagrammatic illustration of revenue and benefits in the Stockholm trial

Two cases of inelastic and elastic demand for road space

CHARGING AREA AND PERIOD Charge collection costs including user compliance costs Revenue including penalty payments Net social benefits Original charging zone before the price rise (Evans 2007) 1) The result of the seven-month trial in 2006 put on an annual basis, Transek (2006) Ditto, SIKA (2006) )The report by Reg Evans, prepared for the Congestion Charging Modelling and Evaluation Team of Transport for London, “brings together various previous estimates by transport for London from a number of sources and takes account of the latest guidance from the Department for Transport on economic evaluation. It also responds to the preliminary evaluations of the congestion charging scheme prepared and published by others” (Evans 2007, page1). Total charge collection costs, revenue and net social Benefits of congestion charging in London and Stockholm, € millions per year

Numbers in Stockholm municipality Jobs Total car commuters 35000Company car commuters 25000Own car commuters using the car in work so much that they are exempted from free parking benefit taxation 10000Statements from employers to tax authorities of employee income including taxable free parking benefit in Ditto in Hidden statistics (car commuters paying market prices for their parking, car commuters invited to free parking, illegal parking)

Effects on car commuting in the samples of two independent questionaires in 2006 and 2007 Because of congestion charging 2006 (The Stockholm trial) increased parking cost 2007 Stopped using car to/from work altogether Partial reduction of car use 14% 12% 11% 8% Source: Michael Stjärnekull and Jenny Widell: Förmånsbeskattning av Arbetsplatsparkering – trafikeffekter. SWECO VBB, 2008

Källa: Texas Transportation Institute Urban mobility report 2003 CONGESTION COSTS in the three largest cities in USA

Source: “Highlights of the 2001 National Household Travel Survey”, Bureau of Transportation Statistics, US Department of Transportation Proportion of total households not owning a car All USA 8% New York City54 % Manhattan75 %

Source: United States Census Bureau: 2004 American Community Survey Modal split of travel to/from work in New York City, % Public transport54,5 -subway32 -bus14 -Rail 8 -Ferry (between Manhattan and Staten Island) 0,5 Car -driver30 -passenger 6 Taxi 1 Bicycle 0,5 Walk 8

New York City and surrounding suburbs

The Mayor’s plan

Half of Manhattan

PARKING PRICE (P) INCLUDING CONGESTION CHARGE P = a + b T a = fixed charge corresponding to the congestion charge at present levied at the cordon of the charging zone b =parking fee per hour T = time of parking