Economics

The recent publication of the Full Business Case (FBC) for the A428 Black Cat to Caxton Gibbet Improvements Scheme highlights the policy inconsistencies and misleading supporting analysis that typify road investments. We have the Introduction by the Roads Minister explaining that A428 has long been seen an important section of the strategic road network that required upgrade due to its problems of congestion, poor journey time reliability and resilience, and how accordingly the Scheme will enhance journey times, support local and regional economic growth, create jobs, and improve employment and the environment.

To justify these high level objectives, the 270 page FBC grinds through all possible aspects of the case for constructing ten miles of dual carriageway. This is impressive in its way, but is the effort ‘proportionate’, to use a favourite DfT term, I wonder? Perhaps the intent is to ensure the proposal is crash-proof in the event of any further legal challenge; or perhaps to deter potential challengers from initiating such challenge. Then again, the economics of the investment look pretty marginal, based on opaque reported analysis, so perhaps extensive quantity is seen as a counterbalance to thin quality in making the case for the Scheme.

Journey time savings for all classes of vehicles, of £633m, are claimed as the main benefit, as is usual (although in 2010 prices discounted to 2010, implying some antiquity to the modelling). But this is not split between business users (cars and road freight) and non-business (commuters and others), as must have been modelled, since each class has a different value of time. In other cases I have examined, the split between business and non-business has been shown, with time savings to non-business users almost entirely offset by increased vehicle operating costs, the result of local users diverting to take advantage of faster travel provided by the improved route. The economic case for a scheme depends on the scale of such diversion, since local users pre-empt capacity intended for longer distance business users. This failure to split the journey time savings looks like intentional obfuscation.

The time saving benefits are in any case offset by quite substantial carbon disbenefits worth -£182m. My impression is these are much more than in previous road schemes, reflecting updated carbon values promulgated by the former Department of Business, Energy and Industrial Strategy. So no longer are increased carbon emissions dismissed as de minimis, at least in economic terms. Nevertheless, if, as I expect, the long run benefits of the scheme mainly take the form of enhanced access, rather than time savings, the increased vehicle-miles-travelled (known as ‘induced traffic’), would increase externalities. So carbon disbenefits are likely to have been underestimated.

Whatever the magnitude, new road capacity must generate more carbon emissions. What needs to be spelled out is the total increase in carbon from the whole road investment programme, to see to what extent this impedes delivery of transport’s contribution to Net Zero. Regrettably, the new 114 page National Networks National Policy Statement, recently published, fails to prescribe programme level estimation of carbon emissions. If neither at programme level nor at scheme level, where is this significant and unwanted damaging impact to lie?

While the cost data in the FBC are redacted, presumably to protect National Highways position in other road scheme projects out to tender, the initial benefit-cost ratio (BCR) is estimated as 0.92. To make the investment at all viable, ‘wider impacts’ of £282m have been adduced to yield an adjusted BCR of 1.63. This scale of wider impacts seems very high for a non-urban scheme, based as it is on an elaborate, yet in reality, not much more than a back-of-the-envelope calculation. It may be that it is this tenuous boost to benefits, to put the Scheme in the DfT’s medium VfM category, that has necessitated the supporting assessment and sign off by the two accounting officers, the DfT permanent secretary and National Highway’s chief executive.

For my part, I suspect that optimism bias is at work to generate even an initial BCR of 0.92, requiring yet more optimism to get to 1.63. So I would not regard the figures in the FBC as robust, even though the analysis is presented as exceptionally extensive. Yet I have some sympathy for the highways engineers at National Highways, who see this scheme as necessary to create continuous dual carriageway between the M1 at Milton Keynes and the M11 at Cambridge, with onward travel to the ports of Felixstowe and Harwich. A stretch of single carriageway in what is otherwise a dual carriageway route is, to them, offensive. Naturally they seek to add capacity to reduce congestion and achieve a free-flowing network. This approach would also seem logical and persuasive to most local politicians and business leaders not versed in the principles of transport planning and the observed road user responses to additional capacity provision, let alone the minutiae of scheme appraisal and Benefit Cost Ratio calculation.

However, congestion on roads in well-populated parts of the country typically displays morning and evening peaks, indicating use by commuters, who have choices of route. Travel patterns are not fixed and are certainly influenced by network changes. So new free-flowing routes tend to attract additional traffic, whether by diversion in the short run to achieve the saving of journey time, or in the longer run through permitting longer trips within the travel time available. Both of these are beneficial but are not the benefits conventionally modelled, nor are they allocated to the categories of traffic that underpin the original justification for the scheme. Generally, where commuters and longer distance business users share road space, free flow is difficult to achieve, particularly at peak hours.

There is a gulf between the simplistic but erroneous headline justification for this and similar road investments, and the complex, opaque and misleading quantified supporting analysis. It would be good to find a common language to bridge this gap, based on a behaviourally realistic account of what is going on, what options there are to improve matters, and what is most likely to happen in practice if changes are made. Applying the concept of Heuristics is one possible solution.

Heuristics are simple rules – rules-of-thumb – for making decisions, coming to judgement, solving problems or shaping intuitions, that work well enough in most circumstances. I want to suggest that transport planners and practitioners would benefit from relatively simple heuristics in offering advice to decision makers about addressing perceived issues of system inadequacy and the justification for providing additional capacity in a range of circumstances.

This would mean distilling the evidence from research by academics and others to yield rules-of-thumb that are intuitively credible to both practitioners and decision-makers. One problem is that research findings are often based on case studies, specific to place and time, and are path-dependent, so generalisation may be difficult. Besides, the research literature in the area of transport studies has burgeoned in recent years, not necessarily to overall professional benefit, in part the consequence of the proliferation of open access journals that charge researchers for the cost of publication, rather than rely on library subscriptions; this creates an incentive for the journal to downplay rigorous peer review and editorial oversight in the interest of increasing income, and the consequence is a proliferation of case studies that may gain academic credit but are of limited general applicability.

Moreover, the research literature may overlook the authoritative information available in official publications, including statistical series, as well as in the unofficial ‘grey literature’ publications from think-tanks and others. Hence formal reviews of the ‘research literature’ may therefore be both unwieldy and incomplete, making it hard to see the wood for the trees and so difficult to draw useful conclusions. Government departments accordingly now seem often to commission ‘rapid evidence reviews’, which give consideration to a manageable number of selected papers to save time and effort, but selection may be biased, consciously or otherwise, to support the expectations of the commissioning department, and the most important recently revealed insight and understanding may not yet be included.

In these circumstances, I believe helpful Heuristics would need to be based on a deep and wide knowledge of both publications, practice and observed data, to establish a cogent and concise framework for analysis and decisions, in accessible language, not set in stone but subject to review in the light of new evidence and experience.

One area where rules-of-thumb may be particularly useful for transport planners and decision makers is in the tackling of road traffic congestion, central to the contemporary travel experience and to transport investment, such as the A428 Scheme, but for which repeated interventions have demonstrated little impact in practice. To the extent that relief may be achieved, this is more short term than long term. Yet huge amounts of public expenditure are justified by the objective of relieving congestion and boosting connectivity, with little evidence of success at outturn.

So, let me suggest some rules-of-thumb for thinking about road traffic congestion. I will not cite chapter and verse of the evidence in support, for which see my recent book.

• Congestion arises in or near areas of high population density where car ownership is also high. More car trips might seek to be made at times of peak demand than the road network can accommodate. Delays ensue, which motivate some road users to make other choices, including adopting alternative routes or times of departures, alternative modes of travel where available, different destinations where there are choices (such as for shopping trips), or not to travel at all (such as ordering good online). Congestion therefore is generally self-regulating in that if demand increases, delays increase and more potential trips are suppressed. Daily gridlock or long tailbacks are uncommon and arise where there are unanticipated obstructions to movement.

• Increasing road capacity has the effect reducing delays in the short term, but thereafter attracting previously diverted and suppressed trips, as well as permitting new and longer trips, consistent with the maxim that we can’t build our way out of congestion, known from experience to be generally true. The result is additional traffic, known as ‘induced traffic’, which in the short term is the consequences of diversion of commuters and other local users on to the new capacity to save time; and, in the longer term, of road users taking advantage of faster travel to make longer trips to increase access to desired destinations, as well as changing trip origins by moving homes.

• Interventions that reduce vehicle use initially reduce delays, but this attracts back onto the network previously suppressed trips, thus restoring congestion to what it had been. Interventions conceived as intended to reduce vehicle road use include the promotion of active travel and public transport, congestion charging and road pricing, and consolidation of freight deliveries into fewer goods vehicles.

• Reduction in urban carriageway available to general traffic can make more space available for bus lanes, cyclists and pedestrians. This initially can increase congestion delays, which leads to drivers making alternative choices. In the longer term the intensity of congestion is difficult to reduce, but the absolute amount of congested traffic would be lessened and could be better managed to benefit the whole population.

• Induced traffic results in more vehicle operating costs and in additional externalities, including carbon and air pollutant emissions, which public policy is seeking to reduce.

• The orthodox economic case for road investment relies mainly on the saving of travel time. Yet the evidence is that average travel time is a long term invariant, implying that people take the benefit of faster travel in the form of improved access – to people, places, employment, services and activities, with ensuing enhanced opportunities and choices.

• Transport models that project travel times savings, comparing the with- and without investment cases, do not reflect the reality that improved access is actually the main beneficial outcome. Access is subject to diminishing returns, implying declining returns to road investment as the road network matures.

• The car is very popular for its utility in door-to-door travel over short to medium distances, as well as over longer distances when alternatives are less attractive, provided  congestion delays are acceptable and parking is available at both ends of the journey. These conditions may not apply in city centres, where public transport, particularly rail-based in all its forms, provides a speedy and reliable alternative to cars and buses on congested roads. But beyond city centres, in suburbs, towns and rural areas, the popularity of the car as a mode of travel against available alternatives is difficult to challenge.

• Promotion of active travel has limited impact on car use. The evidence is that improved cycling facilities mainly attracts people from buses, which reduces farebox income and leads to reduced service levels or a requirement for more subsidy. It is difficult to be pro-active to successfully increase walking, which is the slowest mode of travel, permitting the least access to desired destinations for most people.

• The built environment, within which are located nearly all the homes, facilities and services that are trip origins and destinations, is largely a given, with limited opportunity to increase density through brownfield or infill development. Creation of new communities on greenfield sites with choice of travel modes has proved difficult. Accordingly, there is limited scope for the creation ’15-minute cities’, an aspiration of many urban planners, aimed at reducing car use, congestion, pollution and carbon emissions.

• As well as being popular for getting from A to B, for many people ownership of a car is attractive for a variety of lifestyle reasons. The fact that cars are generally parked for 95% of the time is a seemingly persuasive economic argument for car sharing in its various forms. But conversely, the desire to own a resource that is so little used is an indication of the value attached to ownership and convenience. This is in part why it proves difficult to shift car owners to other modes. Cars parked at the kerbside reduce carriageway available for vehicles on the move, contributing to congestion delays and deterring some road users.

• The wide use of digital navigation (known in the roads context as satnav) has the effect of redistributing traffic. Commuters and other local users divert from existing routes to new capacity on major roads, to save time, pre-empting capacity intended for longer distance business users, including freight, so detracting from the projected economic benefits of the new capacity. In addition, traffic diverts from congested major roads to minor roads that offer a less congested alternative route, such minor roads previously used only by those with local knowledge, making them ‘rat runs’ less suited for active travel and detracting from quiet residential environments.

• The most advanced forms of digital navigation predict journey times, so reducing uncertainty about time of arrival, which is what bothers road users most about the impact of congestion. Digital navigation is thus arguably the best means available for mitigating the perceived impact of road traffic congestion, as well as being vastly cheaper than providing new road capacity.

These rules-of-thumb about observed realities are proposed as ‘good enough’ ways of recognising and addressing the problem of congestion that we face on road networks and identifying effect means of mitigation. I suggest three questions to structure shared thinking about this and the other problems we face, amongst transport planners, politicians, other decision makes and influencers:

Q1 What’s going on here?

Q2 What options do we have to do better, that are both cost-effective and affordable?

Q3 What choices to make?

Responding to the first two questions is the task of analysts, including transport planners, economists and policy advisers, approaching problems with an open mind. Responding to the third question, with the benefits of the answers to the first two, is the task of decision makers in the public and private sectors, as well as advocates of all kinds. Better decisions would be made if those involved are clear about their roles, tasks and expectations. Heuristics, of the kind outlined above, could help them acquire good intuitions of the cost-effective options available, and give others greater insight into the basis on which decisions are made.

Nevertheless, some may argue that such heuristics serve to over-simplify what is bound to be a complex analysis of what’s going on. Albert Einstein said: ‘Make things as simple as possible, but no simpler’. Are these heuristics for understanding and reacting to congestion good enough or are they too simple? Do we still need the full panoply of the Department for Transport’s Transport Analysis Guidance to present to a small coterie of people a theoretical analysis based on problematic behavioural assumptions as to what should be done? Or, as some may believe, to justify, through virtually impossible to decipher analytical complexity (as represented by the likes of A428 business case), someone’s original hunch, then bought into tenaciously by the scheme’s promoting bodies. My own view is that narrative and dialogue based on heuristics would offer an alternative approach, well worth trying, to answer the three questions above in a generally understandable way.

This blog was the basis of an article in Local Transport Today of 21 March 2024.

I previously mentioned my analysis of the widening of the M1 motorway between junctions 10 and 13. My paper has now been published in a peer-reviewed journal: Transportation Research Part A, 174, 103749. The abstract is below. Access to the article may be available free of charge for a limited period here

Abstract

Cost-benefit analysis of road investments involves models that generate travel time savings as the main economic benefit. Evaluation five years after opening of a scheme to widen a section of England’s M1 motorway between junctions 10 and 13 found that the traffic moved more slowly than before the scheme opened. Comparison was made with forecast flows generated by SATURN variable demand modelling and an associated economic model. Substantial net benefits to business users were forecast, whereas for non-business users time saving benefits were more than offset by increased vehicle operation costs, consistent with diversion of local trips to take advantage of the increase in capacity. There is reason to suppose that such diversion is facilitated by the wide adoption of Digital Navigation (known generally as satnav), which makes evident the fastest route choices, even at the expense of increased fuel costs. Diversion of local trips to utilise new strategic road capacity seems likely to be a general phenomenon, which detracts from the economic case for road investment. There is therefore a good case to treat the strategic road network as mature, focussing on improving operational efficiency and exploiting vehicle-to-infrastructure connectivity in the form of Digital Navigation.

The National Infrastructure Commission has published an Advice Note, directed to the government, on roads policy, to help inform plans for the Third Road Investment Strategy (a five year investment programme for strategic interurban roads). I found this rather disappointing in its analysis of the problem.

The need to decarbonise road transport is obligatory, yet investment in new road capacity is counterproductive, whatever is achievable through the switch to electric propulsion. The Department for Transport’s draft National Networks National Policy Statement, recently issued, persists in addressing carbon emissions at scheme level, where they can continue to be treated as de minimis. There should be a requirement to estimate carbon emissions for the whole future programme (RIS3), when announced.

Given the conflict between road building and achieving decarbonisation, a critical look is needed at the econometric analysis of the relationship between interurban road investment and GDP growth, which is less than convincing. Likewise, scepticism is justified as regards projections of the growth of future traffic growth based on demographic and economic factors; per capita car use did not increase for twenty years prior to the pandemic. The main factors determining car use per capita are speed of travel, time available for travel and household car ownership, none of which seem likely to increase in the future.

The benefits of road construction are subject to diminishing returns. Arguably, the UK has a largely mature road network. For instance, cities such as Stoke-on-Trent and Wakefield, which would see themselves as lagging economically, are well located in relation to the Strategic Road Network. For devolved regional governments able to decide priorities for infrastructure investment, new road capacity may not be high, except where it is required to permit major site-specific development.

The Advice Note argues that effective prioritisation of road projects requires a focus on the links that will be most significant for trade between major regional cities. However, interurban roads are used by commuters travelling into cities. It is a common situation for traffic on interurban routes in or near populated areas to show pronounced morning and evening peaks, the consequence of commuting. If capacity is increased to alleviate congestion at these times, this will attract commuters from local roads on account of the faster travel made possible – one type of induced traffic, and one reason why we cannot build our way out of congestion. This diversion of commuters on to new major road capacity is facilitated by the wide use of Digital Navigation (generally known as satnav), which makes fastest options clear. The increased local commuting pre-empts the additional capacity intended for longer distance business users.

The proposal for a systematic analysis of the road network to see which routes are slow or unreliable is reminiscent of the approach of US highway engineers to categorising levels of service as the basis for proposals to increase capacity, thus justifying multilane freeways that attract more traffic. Yet there is a conflict between accepting the need for further road construction and demand management measures to reduce carbon emissions from the sector.

We no longer add to urban road capacity to accommodate growth of demand for road traffic; indeed, the trend is to subtract carriageway available for general traffic in favour of more space for buses, cyclists and pedestrians, plus investment in urban rail, traffic management and demand management measures. Yet the focus of interurban roads policy continues to be on investment in new capacity (although the Welsh Government has taken a different view). Given the demands of decarbonisation, a reconsideration of this traditional focus is desirable.

The prospects for autonomous vehicles as a source of economic benefit are unclear. Yet Digital Navigation is widely use and is changing travel behaviour. Road freight operators take advantage of similar digital technologies to manage their fleets effectively. There are opportunities to exploit digital technologies to improve the operational efficiency of the mature road network, which would be far more cost effective than civil engineering technologies employed to increase capacity.

Road pricing has been a perennial issue for transport policy, seen by transport economists as a rational means for allocating scarce road capacity when congestion is prevalent. The loss of revenue from road fuel duty as we switch to electric propulsion is a further reason to introduce road pricing, as the House of Commons Transport Committee argued in a report published in February 2022. The Government’s belated response, in the form of a letter from the Chancellor of the Exchequer sent in January 2023, stated that the government does not currently have plans to consider road pricing. The Transport Committee chair was not satisfied with this brush-off and has invited the Treasury to respond in greater detail to the Committee’s conclusions and recommendations.

The recent webinar, in which I participated, on the role of road pricing in achieving Net Zero, organised by Landor in partnership with SYSTRA, was therefore very timely. (View here https://www.youtube.com/watch?v=keDmdMMvPO0 )

Road pricing (or road user charging) has been in use for centuries in the form of toll roads, the money levied used to reimburse the cost of construction. Road pricing (or congestion charging) has been adopted in London, Stockholm and Singapore as a demand management measure. A more recent aim has been to reduce air pollution in urban areas by imposing a charge on the more polluting vehicles if they enter a Clean Air Zone (CAZ). And the need to decarbonise the transport system now prompts the question of whether and how road pricing might help achieve this objective.

Webinar contributor, David Connolly, SYSTRA, argued that to achieve a Net Zero trajectory for transport, there would need to be a significant reduction in car use. To attain this, the cost of car use would have to rise significantly, to increase the relative attractiveness of all of the alternative modes, (including car-sharing) and encourage shorter &/or less-frequent car trips. Increased costs of car ownership, of fuel and of parking were possibilities, but distance-based road pricing would have a direct impact on car use and could plug the revenue gap created by the loss of road fuel duty.

Trevor Ellis, an expert in the technology of road pricing schemes, outlined how these have been applied throughout the world. GPS-based tolling has already been adopted by a number of European counties for trucks, while many US states are trialling or operating per mile fee programmes. In Asia, Singapore and Indonesia are to implement national all-vehicle distance-based schemes soon. Trevor concluded that distance-based charging by GPS gives the flexibility to vary the charge by time and place, as well as by distance and emissions, but the biggest challenges are likely to be gaining political and public acceptance.

Silviya Barrett, of the Campaign for Better Transport, reported the outcome of a survey of public attitudes to road pricing, finding substantial agreement that the present system of vehicle taxation is in need of reform as we switch to electric vehicles (EVs), with almost half respondents supporting pay-as-you-drive as they reached the end of the survey. There would be more support if public transport were cheaper with improved connectivity.

My own view is that it would be difficult politically to use road pricing to increase the costs of motoring or of road freight, as a means to reduce vehicle usage. Our society is too dependent on road transport, so that not many politicians would be brave enough to attempt to reduce carbon emissions by a direct hike of road fuel duty or imposing an additional charge for road use. The situation of low-income motorists needing their cars for travelling to work would be a point of particular sensitivity.

However, EVs do not pay fuel duty, so there is a case that they should pay a charge for use of the roads, both to contribute to the costs of operation and maintenance of the network, and to make a contribution to the Exchequer, as do internal combustion engine (ICE) vehicles. Yet this could not be implemented immediately since the lower operating costs of EVs are important to compensate for the present higher capital costs. Nevertheless, it is expected that capital costs will decline as battery technology advances and that equivalence in capital costs of EVs and ICEs will be reached prior to the 2030 date for completion of the phasing out of sales of new ICE cars and vans.

The phasing out by 2030 is a policy that commands wide support across the political spectrum, as well as from the car manufacturers and the public, who are purchasing EVs in impressive numbers. It would be desirable to link the introduction of a road user charge for EVs to this policy approach, on the grounds of fairness as between the two kinds of vehicle in respect the operating costs incurred. This would allow time to develop a suitable road pricing system for EVs. I suggest that the existing fuel duty should remain in place for ICEs, which would avoid the anxiety that would be created, particularly amongst low-income motorists, by a major change in the charging regime. EV owners are generally better off, given the newness of the technology and the very limited second-hand market, and would be more able to cope with the cost increase.

There are variety of technologies that might be used to implement road user charging, some of which are in use other countries. Yet rather than introduce an unfamiliar technology, there would be much to be said for building on London’s experience, as the basis for a national system.

The London congestion charge has been in operation for twenty years. It has been technically successful, publicly acceptable, with no concerns about privacy despite camera surveillance for enforcement purposes, and it generates useful net revenues that support public transport provision. London has employed the same enforcement and charging system to implement the ULEZ (its version of a CAZ), initially within the central congestion charging zone, expanded last year to encompass the area within the North and South Circular Roads with fairly minimal public opposition, and intended to cover all London boroughs later this year (albeit with some local political resistance emerging in the outer boroughs). This exemplifies the scope for incremental roll-out of an established technology.

London’s daily congestion charge is based on the presence of the vehicle within the charging zone, for however long. For London’s technology to the basis for a national road user charging scheme for EVs, it would be necessary to migrate the charging arrangements to a smartphone app, since a smartphone knows where it is in time and space, so knows if it is in a charging zone at a time when the charge is levied. Smartphones are generally linked to  payment mechanisms. They would also need to be linked to the vehicle, since it is the presence of the vehicle that is chargeable, not the phone, but this should be feasible.

Adoption of the smartphone as the mechanism for payment could be incentivised by capping the daily payment at no more than the standard daily charge as paid via the existing online payment mechanism, at present £15. Once there was sufficient uptake of the app, there would be opportunity to vary the charges according to such factors as duration in the charging zone, time of day, level of congestion, location or distance within the zone. This should be publicly acceptable with the daily charge cap in place, analogous to the capping of fares on London’s buses and trains when contactless payments are made. The standard daily charge payable online would remain for those not wishing to use the app, as would the existing camera-based enforcement system.

With the app payment mechanism tested and accepted, it would be possible to extend it beyond the existing congestion charging zone. In the past, there had been a western extension of the London scheme, introduced by Ken Livingstone when he was mayor, but revoked by Boris Johnson. It would also be possible for other cities to adopt the technology, whether before or after national adoption for EVs. In the past both Manchester and Edinburgh developed plans to implement congestion charging, which, however, were rejected in referenda. Cambridge is considering a similar initiative. Adoption by a single city may seem a major step by the voters, whereas taking advantage of a national charging system in prospect may lessen their reluctance.

A national scheme of charging for road use by EVs could be introduced incrementally, whether by road type (such as motorways) or region, and by starting the charge at a low level, increasing over time as the arrangements bed down.

While a national scheme for EV road user charging might employ a separate payment app from that used in London or other cities, it would make more sense to use a single payment mechanism, apportioning the revenues between the Exchequer and the highway authorities, allowing the latter scope to vary their component of the charge to meet local needs. Over time, this could reduce the need for local authorities to bid competitively to central government pots of money for funding local transport initiatives, consistent with a general policy trend to increasing devolution of responsibilities from national to local government.

One particular possibility for the exercise of local decisions on the local component of the road user charge would be to fund improvements to public transport by increasing the charge, subject to the willingness of the electorate. More and better bus and rail services would be important in providing an alternative to car use, so facilitating decarbonisation. However, fare box revenues are insufficient to support good services, both frequency and geographical spread, so external funding is required. Yet subsidy from government, whether national or local, will always be in short supply. So revenues from road user charging seem the most likely source of further support to improve local bus and rail services.

The phasing out of sales of new ICEs by 2030 is generally agreed to be about as rapid as is feasible, but faster decarbonisation thereafter could employ the revenues from EV road user charging to fund a scrappage scheme for ICEs. This would need to be targeted at the most carbon emitting vehicles, a function of engine size and distance travelled. Age would also be important since the amount payable per vehicle would become more attractive as vehicles became older and less valuable. However, such a scrappage scheme could not usefully be implemented until there were good numbers of EVs available in the used car market.

Overall, my view is that road user charging seems unlikely to be acceptable as a means to increase the costs of road vehicle use generally in order to reduce distance travelled and carbon emissions. But there is a case for charging EVs once capital costs reduce, on grounds of fairness between vehicle with different types of propulsion. The good experience of the London congestion charge offers an incremental route to nation application, the key step being migration to a smartphone app, a familiar payment mechanism. Revenues could be apportioned between central and local government consistent with further devolution, and employed to facilitate transport decarbonisation by supporting improved public transport and funding a scrappage scheme for internal combustion engine vehicles.

So no big-bang implementation of road charging technology, rather an incremental approach that aims to carry the public along, step by step.

This blog post was the basis for an article in Local Transport Today of 20 March 2003.