Road User Charging Trends
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1 Road User Charging Trends National electronic Tolling Form Smart City Tolling Brisbane, Qeensland May 2016 Jack Opiola Managing Partner / President jack.opiola@dartagnan.net D Artagnan Consl0ng LLP
2 The only thing that is constant is change Heraclits 535 BC 475 BC D Artagnan Consl0ng LLP
3 Mobility Charging for Road Usage Trend: Indirect to Direct Charging for Mobility Taxes on Vehicle Ownership Taxes on consmables related to vehicle ownership Direct Charging for sage of selected roads/crossings/ lanes Direct Charging for sage of Areas / Zones Direct Charging for sage of road network Base level charging Base level charging/fees & tolling Direct charging to achieve policy goals D Artagnan Consl0ng LLP
4 Contries with direct distance based HV charging Eropean Union Germany (GNSS) Astria (DSRC) Czech Repblic (DSRC) Slovakia (GNSS) Poland (DSRC) Hngary (GNSS) Belgim (GNSS) Americas Oregon (GNSS/odometer) Kentcky (odometer) New Mexico (odometer) New York (odometer) New Zealand GNSS/hbodometer) Rest of Erope Switzerland (tacho/ GNSS) Rssia (GNSS) Iceland (odometer) Confirmed next Slovenia (DSRC) Blgaria (GNSS) D Artagnan Consl0ng LLP 4
5 Rssia lanched world s largest system Started 15 November 2015 with many protests. 12 year concession to RT Invest, sbject to legal challenge. 50,774km of charged highways, vehicles over 12 tonnes. Enforcement delayed ntil October 2016 (481 enforcement gantries, 100 mobile nits). Ptin decided to abolish registration fees to assage concerns. 2 million vehicles liable per km (US$0.02) single rate half the intended charge. Prepaid acconts (GNSS nits measring distance) or trip tickets. Main isses appear to be ser acceptability of new charge, accelerated introdction, difficlties of enforcement. D Artagnan Consl0ng LLP 5
6 Belgim is the latest, bt has had teething problems Started 1 April. Joint commercial entity established by regional governments. Mandatory OBUs for all HGVs (inclding foreign). Self-installed option. Simple location differentiation. Failre to spply pre-ordered OBUs. Last minte qees for OBUs/ acconts. Long call-centre delays. Large scale protests against charges (average impact was to increase charges for long trips). D Artagnan Consl0ng LLP 6
7 Astralian heavy vehicle road reform by state Soth Astralia to release report for pblic consltation in next month or so on pilot in advance of state wide implementation Western Astralia to advance charge as part of Perth Freight Link project, bt ftre proofing for more. Initial explorations by NSW, Qeensland and Victoria. D Artagnan Consl0ng LLP 7
8 To improve is to change; To be perfect is to change often. Winston Chrchill D Artagnan Consl0ng LLP
9 Big challenges of the past have largely evaporated GNSS technology proven, widely available, easy for drivers to install, difficlt to cheat. Costs of GNSS technology have come down significantly making the bsiness case in revene terms mch easier especially against DSRC. Mandatory GNSS increasingly common (Slovakia, Hngary, Belgim). Year/ contry Germany (2005) Belgim (2016) Hngary (2016) Minimm OBU costs D Artagnan Consl0ng LLP 9
10 Trend towards mandatory GNSS based OBUs Jrisdic6on Mandatory/op6onal OBU Distance measrement technology Switzerland Mandatory exc. foreign Tachograph backed by GNSS Germany Op0onal GNSS Astria Mandatory DSRC Czechia Mandatory DSRC Slovakia Mandatory GNSS Poland Mandatory DSRC Hngary Op0onal GNSS Rssia Mandatory GNSS Belgim Mandatory GNSS D Artagnan Consl0ng LLP 10
11 Location and even time based HGV charging is emerging Slovakia differentiates by type of road, and has volme disconts (revene yield and traffic management) Belgim charges more for all roads in Brssels (congestion) and nominally charges all Belgian pblic roads at Czech Repblic has peak charging on Friday afternoons (congestion). Astria has specific charges for highways with particlarly high infrastrctre costs. Astralian HVRR package second phase incldes specific charges to pgrade HGV rotes. D Artagnan Consl0ng LLP 11
12 Progress is impossible withot change, and those who cannot change their minds cannot change anything. George Bernard Shaw D Artagnan Consl0ng LLP
13 New Zealand pioneered the open system model NZ pioneered open system provider approach Hngary took this approach in introdcing HGO heavy RUC with 22 service providers. Ftre Eropean procrements likely to follow (World Bank assessed options and conclded open certification had considerable merit). Oregon followed for both its weightmileage tax and the OReGO pilot. California adopted similar model for Road Charge Pilot Program. D Artagnan Consl0ng LLP 13
14 Light Vehicles indirect or direct charging? D Artagnan Consl0ng LLP 14
15 The internal combs1on engine is developing Toyota, nder and metamorphosing ambi0os into environmental hybrids, Tatso targets, Yoshida, is Barclays aiming to Secri6es sell hardly said. any reglar gasoline vehicles by Toyota 2050, only has hybrids been working and fel on this technology cells, to radically for a long redce 6me. When officials speak ot like this, it means emissions. they are 120 percent confident this is their scenario. Read more here: h_p:// D Artagnan Consl0ng LLP 15
16 Changing composition of the vehicle fleet Sorce: Bloomberg Special Report on Electric Vehicles, March
17 Changing natre of USA Vehicle Fleet New and Total Fleet Stock Sorce: IDDRI, Pathways to deep de-carbona0on in the USA, USA 2050 REPORT, California ARB Presenta0on, MAY
18 Take-p rates of electric vehicles in the US (2015) Clear that California, Hawaii, Washington and Oregon have revene problems, bt also Georgia and Vermont have qite high electric vehicle take p. However, increasing ineqity of fel tax is an isse even in low electric vehicle takep states. Sorce: US DOE D Artagnan Consl0ng LLP 18
19 States responding to transport revene isses differently Pilo0ng RUC Considering RUC Expanding tolls Raised gas tax Considering gas tax increase Gas tax increase rejected D Artagnan Consl0ng LLP 19
20 Charging concepts designed to get feedback abot ser preferences, responses and operational isses Charging concept Measrement of sage Implementa6ons Time permit Unlimited for set period of 0me Vigne_es in Erope; WA, CA Mileage permit Prepaid miles in advance RUC in NZ ; CA Odometer charge Atomated repor0ng with loca0on Atomated repor0ng withot loca0on Postpaid miles based on odometer readings Postpaid miles based on OBU repor0ng Pre & Post paid miles based on OBU repor0ng Hawaii; WA; CA Germany, Slovakia, Hngary, OR, CA, WA, HI OR D Artagnan Consl0ng LLP 20
21 California Road Charge Pilot Program 5000 volnteers inclding 150 trcks (already reached) from 1 Jly 2016, 9 month operation, no transactions. Five Charging concepts: In-vehicle reporting of distance with location In-vehicle reporting of distance withot location Odometer reporting Pre-prchased mileage permit Time permit (similar to vignettes) For accont managers: Azga (CAM) IMS (CAM) Arvato (SAM) EROAD (heavy vehicles only) 21
22 The world as we have created it is a process of or thinking. It cannot be changed withot changing or thinking. Albert Einstein D Artagnan Consl0ng LLP
23 Challenges to change are fndamental User Acceptability (isses inclde rate setting, se of revenes, privacy, impact on existing charges/taxes, enforceability, ease of nderstanding, organised opposition). Practical Transition (Piloting sers, testing robstness of soltions, incentives for sppliers and sers, robst programme management). Delivery approach (Risk transfer vs. competitive delivery, clarity of objectives, size of market, ownership of data, privacy, flexibility, technology, operational framework). D Artagnan Consl0ng LLP 23
24 FAST Act Section 6020 States or grop of states may apply Each grant shold be niqe $95M over 5 years for demonstrations" of ser-based alternative revene mechanisms. First rond of grant applications for states sbmitted on 20 May % state match reqired, hence total fnding is $190M. Any revene collected shall not be considered a toll nder section 301 of title 23, United States Code. Langage is broad enogh to cover heavy as well as light vehicles. D Artagnan Consl0ng LLP 24
25 RUC and Tolling Comparison RUC and tolling have similarities, bt profond differences RUC programs needs to be treated differently than a tolling enterprise: ² Concept of scale needs to be addressed ² Engagement with legislatre shold be different ² Messaging shold be different ² Different bsiness strctre (se of private providers) RUC provides sers the opportnity to impact how the fnds will be tilized. D Artagnan Consl0ng LLP
26 RUC and Tolling: Similarities Both provide ser choice in payment and accont methods Both encorage drivers to plan trips differently Both prodce revene Tolling and RUC are not mtally exclsive D Artagnan Consl0ng LLP
27 RUC and Tolling: Differences Tolling Road Usage Charging Tolling is opt-in RUC may be op0onal or mandatory Tolling generally affects a small % of the vehicle fleet and is geographically related Tolling is charged in dollars per facility, with prices on the order of 10 to 18 per mile Toll tags are devices that provide specific ser ID nmbers Tolling is placed on specific links or facili0es Tolling is typically a single prodct with no vale added services RUC theore0cally affects the en0re state vehicle fleet and every vehicle owner (and possibly ot of state) RUC is charged in pennies per mile, with prices on the order of 1 to 2.5 per mile RUC s Mileage Repor0ng Devices (MRDs) measre/report distance traveled for a specific vehicle RUC charges for all roads in a jrisdic0on RUC is easily combined with Vale Added Services User Based Insrance, Eco- Driving Feedback, and other vale added services, inclding tolling & parking. D Artagnan Consl0ng LLP 27
28 Yo never change things by fighting the existing reality. To change something, bild a new model that makes the existing model obsolete. Bckminster Fller D Artagnan Consl0ng LLP
29 New Paradigm Mobility as a Utility will reqire: User pays policy Ring fencing of revenes Users of infrastrctre have a say on expenditre of fnds Transparency of revenes collected and how they are spent Emphasis on cstomer service and qality service standards Acceptance tightly copled with asset based improvements Organizational design & change tility framework Utility Commission powers and oversight Road Charging pays for the infrastrctre; Tolls are TDM. D Artagnan Consl0ng LLP 29
30 Thank Yo! The most effec6ve way to manage change is to create it. Peter Drcker Jack Opiola Managing Partner / President Jack.opiola@dartagnan.co Tel (+1 703) D Artagnan Consl0ng LLP 30
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