1. Magda Lovei Environment Department
Transport air pollution Key issues, policies, and the case of phasing out leaded gasoline
Magda Lovei
Environment Department

2. Urban air pollution: key environmental concerns
Human health impacts
Highest risk: lead, particulates
Other pollutants of concern: carbon monoxide, sulfur dioxide, nitrogen oxides, ozone, toxic chemicals
Other environmental externalities
damage to natural and physical capital, amenity losses, noise, climate change

3. Relative burden of various environmental impacts
Note: Average for 6 developing cities
Source: Lvovsky et al.

4. Health impacts of air pollution
Almost 40 thousand excess deaths annually in the Newly Independent States
More than 4,000 premature deaths and 1.5 million asthma attacks annually in Jakarta
Average IQ points loss in urban children in Bangok, Cairo, Manila...

5. The costs of air pollution
$1.1 -$4 billion annually in large cities of Asia
Almost $6 billion annually in the Newly Independent States
5% of urban income in Europe and Central Asia, 10% in Bangkok, Kuala Lumpur, Jakarta...

6. Sources of the environmental damage of air pollution
Note: Average for 6 developing cities
Source: Lvovsky et al.

7. Increasing problem in developing countries
Rapidly growing vehicle fleet
High pollution intensity of vehicles
inefficient and old vehicle fleet
poor maintenance
lack of proper emission control
poor fuel quality
Large roadside population exposed (street vendors, pedestrians)

8. Approaches to motor vehicle pollution abatement
Fuel efficiency taxation, standards
Emission control emission standards, I&M
Fuel properties fuel standards, taxation
Demand management vehicle and fuel taxes, restrictions, incentives
Other long-term planning

9. Ranking measures to reduce traffic emissions in Mexico City
Marginal cost of emission reductions
(dollars per ton)
2600
Fuel
Improvements
2100
Emission
standards
1600
Passenger cars
Taxis
(replacement)
1100
Gasoline
trucks
Strengthen inspection
600
Minibuses
Inspection of passenger cars
100
Inspection of high-use vehicles
Retrofitting (natural gas and LPG)
-400
Cumulative emission reductions
(million weighted tons)
Target Reduction
1.2 million tons
Technical controls only
Controls, matched with gasoline tax
Note: Calculations are based on -0.8 elasticity of demand for gasoline.
Source: Gunnar Eskeland, World Bank, 1994.

10. The case of leaded gasoline phaseout
An effective way of addressing an urban environmental priority

11. Blood lead levels worldwide (average of sampled populations, 1980s-1990s)

12. Lead in gasoline and human exposures: close links

13. No serious technical constraints
All vehicles can run on unleaded gasoline
Catalytic converters are not needed
Valve seat recession only affects few old cars
Lubricating additives are available to protect
All refineries can adjust to produce unleaded gasoline
Process changes (catalitic cracking, isomerization, alkylation)
Additives (e.g., oxygenates)

14. Benefits and costs of lead phaseout in the U.S.

15. Key policy conditions Political commitment
Policies to encourage change in gasoline supply
Liberalized gasoline markets and prices
Policies to encourage shift in gasoline demand
Differential taxation - make unleaded cheaper!
Consensus and public information

16. Price difference and market share of unleaded gasoline

17. Progress in the global phaseout of lead
Total phaseout in 25+ countries
Decline in the amount of lead in gasoline
Around 80% of gasoline is unleaded world-wide
Improvements in ambient air quality and human health

18. Rapid phaseout in the Slovak Republic
Driving force: refinery
Key obstacle: valve seat recession in old cars
Solution: lubricating additive
Supporting policies: tax differentiation, public information
Other factors: monopoly and control of distribution system
Not only rich industrialized countries have successfully got rid of leaded gasoline. In the Slovak Republic, the total phaseout weas also accomplished relatively fast. Thh key driving force was the countries sole refinery, which undertook modernization measures to adjust to changing export requirements.
While the refinery possessed capacity to produce large volumes of unleaded gasoline, the old vehicle fleet and concern about valve seat recession created the largest obstacle.
The solution became a lubricating additive developed by the refinery to protect domestic vehicles from damage.
The government introduced supporting policies including differentiated taxes, and supported a public information program carried out by the refinery.
Of course, other factors played a role, too. The fact that the refinery had a monopoly over the production and distribution of gasoline has facilitated the process.

19. Rapid Phaseout in a Small Country: El Salvador
Completed in 1 year
Fast decline in airborne lead (from 1.5 ug/m3 to 0)
Enabling conditions:
Private ownership of petroleum sector
Liberalized petroleum prices
Significant imports
Cost: 1 U.S. cent/liter
One of the best practice cases of rapid lead phaseout in a small country is El Salvador, where the process took place in one year. This example may be representative for other small countries with a small refinery and import of gasoline.
Key advantages of the rapid phaseout are (i) environmental benefits demonstrated by a large decline of ambient lead concentrations; (ii) cost savings by avoiding a dual distribution system; and (iii) no risk of misfueling and destroying catalytic converters.
Several factors contributed to the rapid phaseout:
private ownership of the petroleum sector did not compel the government to provide subsidies
liberalized product prices (1994)
import of high octane gasoline components
The phaseout did not involve significant invests, and the costs were estimated at 1 cent per liter of gasoline.
Lead phaseout has also provided the first step towards broader air quality issues addressing fuel specifications, air quality monitoring, and environmetnal regulations and I&M programs.

20. From health concerns to total phaseout in Thailand
Risk assessment study: lead exposure is priority problem
Political commitment
Price and market liberalization
Strengthened environmental regulations, institutions
Differentiated taxation
Clean fuels program and refinery adjustment
Increasing community awareness
Another example of fast lead phaseout in a developing country is from Asia. In Thailand, a comprehensive risk assessment study was carried out by US AID which demonstrated the health damages caused by high exposures to lead.
The results helped biulding commitment ans strong support from the King of Thailand.
Regulations were introduced to reduce the legal limit of lead in gasoline, and to introduce unleaded gasoline.
The petroleum price and market liberalization also helped the refineries to adjust.
Differentiated taxation played a role here, too. The lower price for unleaded gasoline encouraged consumers to increase the use of unleaded gasline, which was completely eliminated by 1995.

21. World Bank’s support Raise awareness and political commitment
Regional programs in Latin America, Caribbean, Central and Eastern Europe, Central Asia
Help introducing national strategies and policies - technical assistance, dialogue
Bulgaria, El Salvador, Jamaica, Peru, Romania, Thailand, Vietnam...
Facilitate implementation
Thailand: refinery upgrade

22. Conclusions
The transport sector is a large source of environmental damage
Of largest health concern are particulates and lead
Phasing out leaded gasoline is very effective in addressing and environmental priority
Combination of policies and measures are needed
Many stakeholders should be involved