Welcome back to
Country Calendar Sunday Reading. Today I thought it would be nice to lead off with a mesmerising video of sheep herding in New Zealand. It’s not very urban, but it does nicely illustrate bottleneck queuing, which is a common phenomenon on urban roads and busy pedestrian streets. Only with sheep and paddock gates rather than cars and intersections:
Since we’re talking congestion, it’s worth considering what economist Gilles Duranton has to say on the topic (on Knowledge@Wharton). He ties together issues of urban form, traffic, and pricing:
We found that urban density, measured by the density of residents and jobs within a 10 kilometer radius of where you live, appears to have small causal effect on driving. So, if you bring up density by about 10%, it leads to reduction in traveling of about 1%.
…we expected different groups of residents to react differently depending on where they lived — for example, we expected people who like driving to live in places where it’s easier to drive. Actually, these differences were not at all important in our results. Everybody seems to be reacting more or less in the same way. Or at least, we could not find very much of a difference across different groups, across different types of environments. So basically, again, if you bring up density by about 10%, you reduce driving by about 1%.
[However] you won’t be able to achieve very much in terms of global warming using urban policies of that sort. To go after local pollution, you need a tax for congestion — i.e., the concentration of traffic in some areas of a city — so you need to make drivers pay for that. And you need to tax carbon emissions. For instance, the province of British Columbia does this in Canada — it’s a resounding success. I know it’s particularly a really hard proposition in this country, but that’s the one thing that works. Everything else will not do very much.
This research implies that congestion pricing and carbon pricing are likely to be complements to liberalisation of planning regimes to enable people to live more densely, not substitutes.
On the subject of pricing in externalities, New Zealand’s Emissions Trading Scheme could be an important mechanism for getting our high per-capita levels of emissions from transport and agriculture under control. Unfortunately, it’s been watered down to almost totally ineffectiveness by carve-outs for agriculture and existing emitters. In the NZ Herald, Brian Fallow writes about some of the failures of the ETS – and current opportunities to improve it:
Under its current settings, the Government admits, the Emissions Trading Scheme has made virtually no difference to business investment decisions.
And with an impact, until very recently, of a fraction of a cent on prices at the pump, it probably doesn’t affect households very much either.
Now, people have until next Friday to make submissions on whether to get rid of one of the (many) features that have stultified the scheme.
It is the “transitional” measure introduced in 2009, before the Emissions Trading Scheme (ETS) applied to any sector apart from forestry, under which emitters with obligations under the scheme only have to surrender to the Government carbon units for half of the emissions they would otherwise be accountable for.
Submissions are open on MfE’s website – if you or your family members plan to live to mid-century, I’d encourage you to do so.
Also on the subject of climate change, Joe Romm at ThinkProgress writes a good (and very optimistic) take on “why the renewables revolution is now unstoppable“. It’s focused on electricity generation, which is a huge contributor to global warming globally but a relatively modest one in New Zealand. Romm highlights a confluence of technological and market factors that suggest that renewables are on the verge of important changes:
Once upon a time, people imagined that replacing fossil fuels with renewables like solar and wind would jeopardize the electric grid’s reliability. Then along came some major countries who showed that it didn’t, and that there really are no limits to renewable integration.
The result was explained last year in a Bloomberg Business piece aptly headlined, “Germany Proves Life With Less Fossil Fuel Getting Easier”: “Germany experiences just 15 minutes a year of outages, compared with 68 minutes in France and more than four hours in Poland.”
In this post I’ll discuss why it is turning out to be less challenging than expected to incorporate more and more renewables into the electric grid — and to handle periods of time when demand is high but the wind isn’t blowing and/or the sun isn’t shining. As the lead energy specialist at the World Bank, Morgan Bazilian, told Bloomberg after 20 years studying this issue, “Very high levels of variable renewable energy can be accommodated both technically and at low cost.”
Improvements to electricity grids are making it easier to get electricity from places where the wind is blowing to points of demand; more reliable weather forecasting is reducing the risk of unexpected outages; and electricity storage is getting cheaper. Conclusion: Don’t invest in coal mines.
Disruptive transformations are also afoot in other areas. For example, CityLab’s Feargus O’Sullivan reports that London may soon have more bikes than cars at rush hour. This would represent an rapid turnaround in a trend towards cars and away from bikes that went on for most of the 20th century. It’s been caused by a combination of efficient pricing – central London’s congestion charge – and new investments in protected cycle lanes:
According to the [Transport for London] report, the number of rush-hour cars in Central London has more than halved since the millennium. In 2000, an average of 137,000 drivers entered the Central London cordon every day. By 2014, that number had dropped to 64,000. The slump in Central London car numbers is substantially thanks to the city’s congestion charge, introduced in 2003, which saw vehicle numbers drop steadily in the years following.
The rise in the number of cyclists, meanwhile, has been even more dramatic. While just 12,000 people cycled during the Central London rush-hour in 2000, 36,000 were present in the same area at the same time by 2014. Across the day as a whole, the number of Central London cyclists rose from 40,000 in 1990 to almost 180,000 in 2014. So cyclists still have a few years before they overtake drivers, but their numbers are rising sharply, with the speediest growth occurring since 2008.
However, traffic engineering practices can sometimes serve as a barrier to change. Engineer Bryant Ficek has written a thoughtful series on “top 6 ways to pick apart a traffic study” (at Mike On Traffic). It offers some good insights into the pitfalls in traffic engineering from a practitioner’s perspective:
Here are the Top 6 Areas a reviewer could focus on to pick apart a Traffic Impact Study:
- Traffic Counts – we generally complete intersection turning movement counts on one day and then use that snapshot as the foundation for all of our analyses
- Trip Generation – we use the national ITE average rate for each land use, which ignores potential high/low outliers and doesn’t account for local variation or rapidly changing traffic trends
- Modal Split – many times ignored or a general reduction applied to account for transit and other modes of transportation (ITE has recently attempted to correct this)
- Pass-By/Multi-Use/Internal Trips – ITE again provides a national basis for some land uses, but the dataset is very limited
- Trip Distribution – generally based on existing travel patterns (from the intersection turning movement counts) which would not account for regional growth, development patterns in an adjacent city, or other similar types of factors
- General Background Growth – to account for non-specific growth in traffic, a percent increase is usually applied to the existing volumes, sometimes based on historic growth or a regional model
If taken to court, would we have a better defense for the above assumptions than we used “engineering judgment?”
Finally, a few items on housing and urban planning. There’s been a bit of acrimony about this in Auckland over the last few weeks – actually, the last few decades. First, the Government put its thumb on the scales in the Three Kings Quarry housing development, which is opposed by some homeowners groups in the area:
Two community groups, the Three Kings United Group and the South Epsom Planning Group, lodged an appeal at the Environment Court last year to stop the redevelopment of the Three Kings quarry, citing environmental concerns.
Today, the government announced it had joined Auckland Council and Fletcher Residential to fight the appeal.
Housing Minister Nick Smith said the redevelopment would build 1500 apartments and townhouses, and employ 1000 people during construction. He said something needed to be done with the quarry so it did not sit as is for another decade.
“It is an ugly eyesore, and I find it very difficult to accept there aren’t significant environmental benefits as a consequence of being able to proceed with these developments.”
“It is of some concern to me that small groups such as that are able to cause huge delay for a $1.2 billion project.”
Shortly after, Auckland Council decided to withdraw its residential rezoning proposals literally days before independent hearings on the proposed changes began. They’ve apparently been spooked by pressure from people who oppose new homes being constructed anywhere near them. However, it’s a risky strategy, as it reduces their ability to have a say in the hearings – and probably annoys central government no end. Ben Ross at Public Address has written a cogent summary of what Auckland Council’s decision may mean for the hearings on the Unitary Plan:
Long story short: Council’s Primary Evidence into the rezoning is of consequence to all other hearings and all other evidence by submitters to those previous hearings. That’s what the Resource Management Act requires.
But the most important part that Burton, Desley Simpson and others fail to mention is this:
The Panel could very well reject what the Council or any submitter has called for in the hearings and give very different recommendations in order to meet the requirements of the Regional Policy Statement.
So what Council is presenting IS NOT FINAL.
Final is when the Panel gives its recommendations back to the Auckland Development Committee and that committee adopts those recommendations from The Panel.
But why is rezoning important? It is a necessary step in enabling people to build more homes in Auckland. And, simply put, building more homes in places where people want to live improves housing affordability for everyone.
That’s the key conclusion of an excellent new study by the California Legislative Analyst’s Office. City Observatory’s Daniel Hertz reports on the study:
[R]esearchers have taken the next step to showing directly that places like that prevent new construction end up inducing more displacement of their low-income residents.
That finding comes from California’s Legislative Analyst’s Office, which just released a new report on the state’s ever-growing affordability crisis. Using a broad definition of displacement—any decline of a neighborhood’s low-income population relative to its total population—the LAO shows that, even controlling for other demographic factors, Bay Area communities with the greatest expansion of market-rate housing also see the least low-income displacement.
In a similar vein, John Ricco at Greater Greater Washington reports that “DC added record housing in 2015. That’s slowing price increases“:
The composition of 2015’s housing permits in DC skewed heavily towards large multifamily buildings, as it has in recent years. Neighborhoods like Navy Yard and Southwest Waterfront, where there are fewer neighbors to oppose large development projects, are contributing strongly to the city’s overall housing production.
In recent years, real estate analysts have noted that DC’s higher pace of building has led to rents that are slowing in growth, or even declining. This effect is especially seen at the higher end of the market, since most new construction is luxury.
Here’s Multifamily Executive covering a new Yardi Matrix report:
The cities that had the smallest rent gains in 2015 were Richmond, Va.; Washington, D.C.; and Baltimore. Echoing other reports, Yardi says Washington’s rent gains have been held back because of the large amount of new supply in its market, while Baltimore still lacks job growth. These cities can expect to see similar results in 2016, Yardi says.
However, changes are needed to enable more cities to benefit from similar trends. LSE economists Christian Hilber and Olivier Schöni identify some key reforms to planning systems:
How should a planning system then look like and what would be good policies and instruments to tackle the key housing issues? First, a good planning system should be designed to focus on correcting market failures. Second, by (i) allowing vertical expansion (i.e., largely abolishing height restrictions) and thereby permitting densification in central parts of cities, (ii) imposing a land value tax, possibly with varying rates (to prevent excessive construction in areas where this is not desirable—tax rates could be extremely high, for example, in areas of natural beauty), and (iii) only allowing the construction of new housing near existing developments (thereby limiting the excesses of sprawl), policy makers could keep housing affordable and largely prevent sprawl. While implementing such radical reforms may be difficult and will undoubtedly attract resistance from vested interests, the political rewards in terms of sustained political support could be substantial. Now there is an idea for policy makers around the globe.
Apropos of that, here’s a chart summarising how Auckland Council’s proposal would have changed zoning in Auckland:
2040 & scaremonger councillors: AKL will be covered in high rise apartments
Fact: only 6% of resi areas > 3 storeys pic.twitter.com/aEy8t4ov8g
— Greater Auckland (@GreaterAKL) February 11, 2016
That’s all for the week. See you next time!