Last week Henderson-Massey Local Board Chair Shane Henderson (yep, great name for the role) highlighted a key issue with those criticising the proposed fuel taxes I also discussed last week.

This led into a long discussion about whether road pricing is a realistic alternative. The short version of the answer is almost certainly “not for quite a long time”.

I’ll work through a few reasons why I think this is the case and why I think Auckland is probably around ten years away from being ready for a widespread road pricing scheme, noting that in the shorter term (say around 2024 when City Rail Link and Light-Rail are finished) introducing a city centre cordon scheme might be a good idea.

Anyway, let’s work through what road pricing is, what the benefits we expect from it are, whether it could be a replacement for current revenue tools like fuel taxes and what might determine the “right time” for Auckland to implement it.

What is pricing?

Fundamentally road pricing (also called congestion charging and smarter transport pricing) looks to vary the cost of travel by time or location to better account for all the costs that people impose when they travel. This sounds a bit like economic-talk, but essentially means that when people drive on a busy road at peak times they contribute to making it congested and so impose delays (and therefore costs through wasted time) on others. In a general sense demand exceeds supply and queuing, rather than price, determines who gets the available road space.

Pricing seeks to fix this by creating an incentive for some people to travel at a different time, different route or different mode by increasing the cost of travelling on the high-demand route. Because of the way traffic works, encouraging a few people to change the way they travel can have big improvements for everyone else – particularly if it gets demand back to more optimal levels where throughput can be maximised (the right side of the graph below):

speed-flow

Is pricing a good idea?

Talk to any transport economist and they’ll tell you road pricing is a no-brainer and they can’t believe it hasn’t yet been implemented everywhere already. Talk to any politician and they’ll tell you road pricing is political poison and they’re amazed it’s been implemented anywhere.

Ultimately pricing creates winners and losers, but if done well, should lead to better outcomes overall. There’s a reason why airline ticket prices vary by the time you travel, as otherwise you’d never be able to get on an 8am flight unless you booked months in advance. Similarly, we pay a market price for bread rather than queuing for it. Sure that means that poorer people may struggle to afford some goods and services, but (at least theoretically) we have agreed that it’s better to address income disparity directly through social welfare schemes rather than forcing bread prices down.

Putting a good pricing system in place is likely to create significant benefits. These were highlighted in ATAP, where the introduction of “smarter transport pricing” (a whole of network GPS-based scheme that doesn’t yet exist anywhere in the world) led to huge impacts on congestion and employment accessibility:

As well as huge improvements to access and congestion, pricing should result in more efficient use of existing roads and reduce our need to spend money on transport over time. After all, most roads are hugely under-utilised outside peak hours and pricing will act as an incentive for people to travel outside the peak and via more spatially efficient modes like public transport.

However, pricing systems have only been implemented in a few cities around the world and usually in a fairly crude way. The London congestion charging scheme, for example, is a flat-rate price to enter one particular part of the city during the day. It doesn’t distinguish between individual roads, peak and off-peak times (except at night) or vary according to how long the trip is within the charging area. Central London is also obviously one of the most well served locations in the entire world with travel choices, including an incredible variety of train, tube, bus and bike infrastructure meaning that the scheme only actually affects a tiny proportion of people travelling to this part of London each day.

I think the reason why so few cities have implemented road pricing is that it’s actually really hard to get right – especially with current technology.

  • It’s easy for a scheme to inadvertently result in perverse outcomes (like encouraging vehicles that previously used the motorway to now use local streets to avoid a charge)
  • It’s easy for a scheme to hurt lower income households with fewer travel choices
  • It’s hard, in a practical sense, to vary the price that people pay to travel by time and location (at least with current technology)

So overall pricing is probably a good idea, but we should also recognise that it’s also potentially quite easy to get wrong and the implications of getting it wrong could be pretty severe.

Is pricing a good revenue tool?

Pricing is a good way to improve the transport network’s performance and will potentially raise substantial revenue (depending on the design of the scheme). There are probably two main issues with using pricing to raise revenue :

  • It is an expensive way to raise money. Around 30% of revenue raised in London’s congestion charging scheme goes to operating the scheme itself, which basically means that the public needs to pay a heck of a lot more to generate the same amount of net revenue as other, cheaper revenue tools like fuel taxes and rates.
  • The revenue goals may conflict with other objectives like demand management and fairness. Under a complicated road pricing scheme you could see a scenario where you “should” charge a pretty low price off-peak or on some uncongested routes to incentivise people to change the way they travel. But that’s going to reduce revenue. Furthermore, you might make a decision to only charge a low rate for travel in areas where there are fewer travel alternatives (e.g. outer suburbs or rural areas) or in lower income areas, but once again that’s going to reduce your revenue.

Overall I think you would struggle to justify doing road pricing for revenue reasons alone, because of the issues above. Furthermore, if part of your approach to road pricing is to make travel cheap at some times and in some locations, which makes sense given that the current ‘flat rate’ system over prices people who travel on quiet streets outside of peak times, then by definition pricing can no longer be about “adding more revenue” – it starts to become a replacement funding system.

So overall, I’m a bit doubtful about whether pricing is a good revenue tool, but that doesn’t mean it’s a bad idea (because pricing is a good demand management policy).

When should Auckland implement pricing?

The Phase One report of the “Congestion Question” project, formerly known as the Smarter Transport Pricing Project, draws from a wide variety of international experience to make some key recommendations about what might be the best way to implement pricing in Auckland. Essentially it boils down to two implementation options:

  • Start with something small (like a city centre cordon) and expand over time as technology improves, people get used to the idea and travel choices improve.
  • Do a “big bang” approach and go straight to the kind of GPS-based whole-of-network scheme that ATAP proposed.

The report strongly recommends the first option, as a far less risky approach. Risk is an important consideration as proposed pricing schemes have failed just as often as they’ve succeeded. But when might Auckland be ready to take a first step, or a second step?

Answering this question requires us to get back to the fundamentals of how road pricing works – by using price to incentivise some people to change the way they travel. This might be a change of route, change of travel time or change of mode (from car to PT for example). Ultimately, some people will change the way they travel to avoid/reduce the cost and some people will not change and pay the cost. Looking at these two groups separately we can get an idea of what will help more people to come out as “winners”.

  • For those who change, there’s clearly a cost to them in needing to travel via a different route or mode, or at a different time.  Otherwise they would have been travelling this other way in the first place. A successful pricing scheme will be one that gets enough people to change at the lowest possible price. Importantly, the better their alternatives are (which could mean available public transport that’s nearly as fast as driving, or an employer who allows flexible work times so they don’t need to travel during peak hours) the lower the price needs to be. If your travel alternatives are terrible (say a bus that takes more than twice as long as driving, like currently exists for much of Auckland) then prices are going to have to be really high before people start changing the way they travel. This is really problematic because….
  • …for those who don’t change (which may well be most people), they “win” if the gains they get from reduced congestion are greater than the extra cost they need to pay. The higher the price, the less likely this trade-off will come down in their favour and you will see a lot of people paying a lot more money to get around just a bit quicker.

This is a rather long-winded way of saying that pricing is most likely to be successful and beneficial once Auckland has much better public transport, walking and cycling options. In fact, the better these travel alternatives get, the lower the price that will need to be charged to get the same number of people to “change” and the more winners there will be.

So when might Auckland’s public transport, walking and cycling options be “good enough” to implement road pricing? There probably isn’t an exact answer to this, but in the places where road pricing has successfully been implemented (London, Singapore and a few Scandinavian cities) the vast majority of travel was already being made by non-car modes in the areas affected by the pricing schemes.This is a pretty different situation to Auckland where car travel is a minority only for the city centre, and the vast majority in other areas.

The major programme of public transport improvements that Auckland will implement over the next decade (City Rail Link, light-rail, Eastern Busway etc.) will radically change the availability of high quality public transport for many parts of the city. But even then it seems that it will probably only be the city centre that is getting close to having similar travel characteristics as places where pricing has been successfully implemented.

Ultimately I think it is the timing of these major public transport projects that will determine when it “makes sense” to implement road pricing in Auckland. If we do it too early, before these projects are in place, we will need to charge such a high price to achieve sufficient modal shift to reduce congestion that most people will have to pay more than the travel time they save. The loss for those that have to shift the route, time of mode they use may also be substantial – and most likely felt by lower income households in poorer outer suburban areas.

Of course, this means we need to find a way to fund these public transport projects that help get Auckland ready for pricing. And that requires revenue-raising tools that we can implement quickly, and cheaply. Which at this point means fuel taxes.

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160 comments

  1. Hopefully the governments plan to increase funding for PT (hopefully lowering the rate for firebox recovery) should mean lower fares and drive up usage (which usually starts to improve farebox recovery again).
    Auckland really needs to improve the offpeak offering (both frequency and pricing) as while peak services are usually fine for most the off peak services put people off.

    Hypothetically if all fares were reduced by 10% and advertised (and sufficient capacity provided) then I would imagine a 15-20% uptake in PT usage. It becomes a virtuous circle as more demand means more frequency which in turn makes it more popular.

  2. I agree with the thrust of the article – road pricing is a demand management mechanism, but not necessarily a funding mechanism. It was not designed for that purpose. It does not raise enough revenue unless it is set at punitive levels.

    Another more sophisticated example is Stockholm, where the cost is set ar a level realistic for average commuters. Variation by time of day creates the incentive, and that works well. So yes to the fuel tax. But consider a city parking levy too. City parking is highly profitable, is owned by wealthy people (Wilsons is owned by a family of Hong Kong billionaires) and is used by people on > average incomes.

    BTW Stockholm has a PT mode share well below 50%. Road pricing there was unpopular at first. It was started as a fixed term trial. After people saw the benefits, its popularity 8ncressed and it was made permanent.

    1. +1 City parking levy, axle-load based truck RUCs that actually pay for the damage they cause, and some general taxation, as the health, welfare and environment budgets will be less strained.

    2. Parking garages in the city centre should require a HOP card to pay, which is just one step closer to shifting some trips to PT.

  3. “For those who change, there’s clearly a cost to them in needing to travel via a different route or mode, or at a different time”

    Not necessarily, they may save money and/or get a better/faster trip (compared to their ex ante trip) from changing. It’s carrot as well as stick.

    I am not sure that the current proportion of trips by car is a good indicator of when pricing should be implemented. Absent road pricing, all congested cities have their roads operating at capacity. The effect of road pricing will therefore be similar on those that drive in those cities. The fact there are a small or large number of people taking alternatives pre road pricing is neither here nor there to the road users. We may have a higher proportion of people driving than other cities, but we also have a higher amount of per capita road capacity than those other cities.

  4. Transport alternatives are good enough now, and will get a whole lot better with congestion pricing (and more bus lanes). Let’s get the cordon for the inner city underway. Maybe start with just the bridge and the NorthWestern Highway. Oh – and add the main road to the airport (along with a proper bus lane)

    The technology exists – it’s in successful use on toll roads north of Auckland, and many people/cars already have billing relationships.

    1. Yes, the people who are stuck in congestion on the NW motorway definitely have alternatives but they’re just wasting their time for fun.

      1. I realise your comment is sarcasm, but honestly there are people who say, “I have a car and dammit I’m going to use it, public transport be damned.” These people will not even consider alternatives until some crisis comes along, such as the loss of driver’s license for some offence, or temporary loss of car due to accident damage or theft. Only then are they forced to consider alternatives.

        1. There are always alternatives, it just often takes some real strength of will. Driving is the easy option, despite congestion, parking, incidents, road rage, fuel tax, registration, warrants and mechanical problems. The issue with NW public transport is the inefficiency of it, which makes the argument for it very weak. So people who drive on the NW are not as bad as say myself, when I drive at times once a week from the city to New Lynn. My conscience barely lets me do this, but if my wife demands it I have no choice. The lack of choice can be mostly be blamed on not building a busway when they were widening the carriageway. If you are like me and enjoy a book, a leisurely public transport commute with two transfers is not necessarily the worst way to pass the time!

          1. I think we need to follow up on this: “The lack of choice can be mostly be blamed on not building a busway when they were widening the carriageway.” The reasons given by NZTA’s consultant were that a Quality Transport Network (QTN) route – which is what it was designated as – didn’t justify a busway. However, the route currently doesn’t qualify as a QTN route; it is not reliable. So the consultant was quite wrong.

            Why is this consultant still being used?

          2. I got into a similar situation — I was driving from the city centre to the North Shore. Taking PT would have taken me ages, and would probably have resulted in me being away from home for an extra hour or so. If you have a family, proceed at your own peril.

            Going west was an especially interesting problem. In theory this should be well covered by buses and train. In practice, the arrangement of the bus stops for the New North Road line made it almost impossible to catch one (to the point I walked all the way from Victoria Park to Newton at some point), and the train arrives at the wrong part of town.

            I don’t think you have to feel bad about driving to New Lynn…

          3. I used to take those ‘alternatives’ from Te Atatu Peninsula to Newmarket (for about 5 years). A few observations – car driving is slow, bus is even worse. Bus gets stuck on local arterial due to no bus priority. Bus gets stuck on the onramp due to it being a T2 (with no actual policing), that T2 fills up as quickly as ‘regular’ on-ramp lanes. Bus gets stuck on each and every on and off-ramp along the motorway due to lack of continuous bus shoulders. Along Great North Road, due to numerous bus stops and many traffic lights the bus is slow even in the bus lane. And that’s just going to the CBD. from CBD to Newmarket it’s bad too – no priority on Park Rd (towards Newmarket) or on Khyber Pass (towards CBD), on top of that Broadway – no priority either.
            On top of that really poor frequency past 7pm – 1 bus per hour. General unreliability of the service. It’s not an alternative. From past experiences – the trip takes anywhere between 1h and 1h30min each way. Even being a keen reader doesn’t help here. That trip (around 17km) should not take longer than 25-35 minutes on PT (if PT was a real alternative). I’m not sayin that driving is faster at peak (it works out probably even), but it’s definitely more convenient. The truth is that it feels increasingly like I live on a tiny island, that I’m not allowed to leave or enter anytime between 7-10am and then 4-7pm.

            Introducing any form of road pricing before the PT situation improves will feel like yet another blow delivered. PT as is, along NW is sad joke and there are many other places that have it even worse.

  5. Congestion charges should be congestion relief devices, not revenue gathering – the whole point of them is that having a small congestion charge limits the need for revenue. This might be hard to accept if you analyse it – well where to the people go if they aren’t peak hour driving any more? But if you look at Stockholm’s example (https://www.ted.com/talks/jonas_eliasson_how_to_solve_traffic_jams) they found a very low peak hour congestion charge (1 or 2 Euros) had a profound effect AND people didn’t know where the traffic went. You don’t need to work out travel plans for each person, just like you don’t need to work how how to supply bread to the city – you let the market and people decide. They won’t all flock to public transport – some will decide that they really do need to live closer in to where they work, others will decide they really do need to get a job closer to home. Some will decide to work from home more days per week, some will decide to carshare, some will decide to bike and some will decide to travel outside the charged time period. None of these things need any infrastructure, none need any revenue.
    So I think we should be very clear about this – We need to bring in congestion charges as a road congestion buster, not as a revenue raiser as the primary goal. Of course its crucial that any nett money raised for the peak hour congestion charges go directly into giving people options of avoiding the congestion charge (by means other than those mentioned above) – improving public transport, walking and cycling networks. And I think we should bring it in ASAP, not wait for some mythical future time when we have a perfect PT and active transport network.

  6. One of the key benefits of road pricing regarding revenue is it reduces the need for capacity enhancing road spending by reducing demand. And any capacity enhancing road spending hat dies happen should always be fully self funding. With road pricing you have two options to deal with increased demand – raise prices or build more capacity. You would only build more capacity when it is profitable to do so, like how a baker will only invest in a new oven when demand is such that it is profitable to do so.

    In addition, once you have road pricing there will be less need to subsidise PT operating costs. The price of PT will be in equilibrium with the price of using roads.

    So road pricing will be very effective at reducing funding gaps by reducing the amount of spending required.

  7. I despair a little that the “not for a long time” argument gets such easy traction, when I know that people are unwilling to take the necessary first step of actually conceptualising what a GPS-based pricing system would be asked to do.

    There are already vehicles on the road that use GPS to work out RUC distance, and that are accurate enough to exclude off-road distance – they can certainly find a state highway or major urban arterial for some kind of stage 1 testing/cordon-charge lite trials.

    – If nothing else, these vehicles could be asked to demonstrate their ability to recognise and pay their tolls via these payment mechanisms – assuming that this does not threaten the existing tolling payment system too much. The technology works in the US, so why not here?

    – LINZ and MOT are currently running NZ’s involvement in the Australian satellite based augmentation systems trial – if a funding case is made, then lane-level accuracy becomes achievable – possibly within 5 years, not 10+.

    But the underlying equipment, levels of data transfer, methods of data management etc are set up for a different task to light vehicle road pricing, so none of the current underlying service pricing works very well (but it works well enough for some light vehicles to be driving around with this equipment installed – normally adjuncts to large heavy vehicle fleets).

    And this is partly because no one has yet to put their hand up a say: “Oi, industry: this is what we want to do. When can you make it work and at what prices?”

    After all, why would the private sector go all out investing in developing a product with no clear specification and no ready market?

    Saying “it can’t happen for a long time” is really saying “we don’t want to be called on a performance requirement” and making it a self-fulfilling prophesy.

    (For the purposes of transparency, I currently work for a telematics firm. Prior to that I was having a long break. But prior to that I managed a transport policy team that, among other things, was investigating the possible evolutionary pathway from electronic RUC to road pricing, as had been announced by Hon Bridges at an RTF conference way back when. The views expressed here have been delivered at a few conferences around the traps as well, so are not at all privileged.)

    1. The argument isn’t that the technology doesn’t exist, but rather that the circumstances don’t.

      Put simply nowhere with such a high level of structural autodependency as AKL has tried to implement such a system. We also have a high degree of democracy, meaning politicians cannot, will not, boldly force an innovation on the public that has a chance of being widely disliked.

      Autodependent places, by definition, have a high proportion of car-addicts in the population, addicts lash out if they feel their fix is threatened. This is a politically very risky area.

      Additionally if, as you say, it does not have a revenue raising component then we need fuel tax too. So the debate about it being preferable is to one is irrelevant. Which further limits its appeal to drivers. A new tax.

      1. People also lash out if the well-off project their lifestyles and their access to PT across an entire region to justify charging money that perhaps isn’t as freely available to others as it is to them. “A congestion charge? Just downgrade from the Rolls to a Q7, darling! Much better for towing the boat anyway!”

        Meanwhile, for those of us still trying to get a tank of petrol to stretch to next payday…

        1. Only in a country that has been brain washed by 60 years of auto dependent propaganda could it be stated with a straight face that public transport and cycling are the realm of the wealthy. An idea like that would be laughed at in most countries in the world. The car and fuel lobbies have done a marvelous job of twisting the narrative here and in other auto dependent countries like Australia, the US and the UK.

          “An advanced city is not a place where the poor move about in cars, rather it’s where even the rich use public transportation”

          ― Enrique Penalosa

          1. Look at a map of the cycle network, and then look at a map of house prices. Compare the two. Tell me which part isn’t obvious.

            I can tell you, with a straight face, for 100% sure, that moving to an area with good PT or good cycling infrastructure is extremely expensive.

      2. Addicts… That explains why the NEX is such a failure. Or not.

        Let’s try to explain the lashing out with two observations:

        #1: My commute brings me past a stretch of Glenfield Road.

        If you drive it works the obvious way. You may lose some time in congestion, but buses are trapped in the same congestion. So whatever.

        Or you can catch the bus. Now you have a problem: either on your way to work, or on the way back, you have to cross Glenfield Road. You can walk to the nearest traffic light, however Eskdale Road and Kaipatiki Road are 2 km apart. Or you can try to cross the road. Cars have absolute priority, and come in a nearly continuous stream. So you may see your bus sail by while waiting for a gap in the middle of the road.

        Would you blame people for wanting to be in a car, rather than being one of those suckers stuck waiting on the centre line?

      3. Same issue though. If you don’t clearly articulate what it is you want, because you say it is “a long way away”, people can’t attune to it or take the mental step, in this case, to bring it closer in time. It will always be that far away.

        Of course some people will object – that’s normal and won’t magically disappear. Some of them will, based on overseas experience, come on board once they have something tangible they can experience rather than something scary that is “a long time in the future”.

        The car dependent network argument is also a bit of a red herring, since that is what, surely, the change effort is in part trying to correct.

        In any event, it does not have to be all in one go (or the only part of a response) – which is the trap your line of argument is falling into – but can be done with careful testing of the pieces and even more careful fitting them together so that the public get information they can use, in a democratic process, to form and express (or reject) a view.

        Overseas, various publics seem to have responded and attuned quite quickly to pricing when given actual information to work with, including about how it will work for them.

        Which will never happen here if it is continually relegated to some distant future when we can presumably copy someone else (but aren’t we unique…?).

      4. And #2: A while ago I did the exercise of estimating where I could get within 30 minutes by car, and by bus, during the average weekend.

        By bus, I can get to Beach Haven and Birkenhead, and that’s mostly it. By car I can reach most of the area between SH18 to the north, and Balmoral Road to the south. That’s a staggering difference in access.

        During peak, estimating this gets very hairy. In my case it’s 15 minutes by car, vs about one hour on public transport. This obviously differs between people, but the suggestion to spend more than an hour extra per day in your commute is a pretty big blow to people’s quality of life. As a more general example, the lack of rapid transit from the northwest to the CBD is well-documented.

        1. Agreed. There seems to be an assumption that all commuters have the same time freedoms and quality of life will not suffer if everyone just swaps a car for PT, regardless of whether that’s practically an option or not.

    1. yes. Increase the Fringe Benefit Tax on company-provided carparks as well. Trying to measure the movement of each vehicle will be difficult and expensive. If the same decongestion benefits can be brought about by taxes/levies on parking, then do that instead.

  8. It would be terrible to have a road pricing scheme designed to raise money. It would result in two problems. First, there would be an ever growing list of major capital projects that be put forward regardless of merit to soak up the money. (the only thing that kept the RoNS in check was funding problems). Second we would miss out on a road pricing scheme designed to reduce congestion. If profit is the goal then the price will be designed to maximise marginal revenue rather than maximise efficiency.
    Most monopolies charge more than the efficient price to maximise profit. The volume delay function on roads swaps that around so the maximum profit point means charging too little to have enough effect on delay. Think of it like a discount store price it low, push em through approach.

    The best approach is to sell it to people as a congestion charge and ring fence the money for only capital projects on that corridor that give a financial return and the rest should be used for PT opex in that same corridor.

  9. Work done a decade ago indicated that a comprehensive parking charge regime could mimic some of the demand management effects of road pricing at a fraction of the cost of electronic road pricing. The crucial factor is including off-road as well as on-road parking. In my view this could be a viable source of some revenue with valuable demand management benefits.

    1. Private parking owners do the opposite. They charge a lower earlybird rate that encourages traffic in the peak, then increase the marginal price for people who visit during the day. The only way parking could be used is if the Council bought every parking space and then every parking building and private basement would be run as badly as AT runs its parking buildings. Also if they owned every space then some numpty would start complaining about AT providing any parking at all.

        1. How would you vary the levy based on time of day or day of year? If you can’t then the demand management effects are almost nil and it just becomes a dead-weight tax. We don’t care if people arrive at 7pm and leave before 6am.
          To mimic road pricing you would have to include every single space including those in apartment basements. Then residents would rightly argue that they are being taxed for leaving their car at home.

          1. Apartment dwellers leaving their cars at home when they go to work would be better off renting a car when they need one. All that resource going into a car and a carpark for occasional use is wasteful. Levying every single carpark across the city might reduce this waste.

          2. Heidi – they already effectively face a levy in the form of having to pay for the space to store their car. I don’t see why someone who decides to live in the CBD, and wants a car to use occasionally should be levied extra when I would face no levy for storing a car at home in Panmure.

          3. I guess my response is if they are better off then that is what they would already do. But many don’t. There are plenty of reasons to own a car if you live in town. Everything from getting groceries to going to the beach to getting out of town. Not to mention natural disasters. If you make it really difficult to live there and have a car then a lot of people might choose to live somewhere else where they have to use their car more often.

            I saw similar arguments put forward to justify maximum parking rules. Yet when you think about it a parking space at your home is the opposite of using your car. If someone wants 3 or 4 cars then what is the justification for saying they cant live in the CBD or in a centre?

          4. If someone wants to house 3 or 4 cars in a carpark in the cbd, what kind of embedded energy are they requiring the planet allocate to them for the privilege? Once you consider the built space, including ramps and turning areas, the premium land, the earthquake design, the piling, the concrete. Plus all the resources in the cars themselves. Put it another way, give a justification for why someone should be able to do so when we have a crisis in resource overuse, degradation of the natural world and climate change.

            Apartment dwellers can quax for groceries, walk/cycle/bus to the beach, rent a car for weekends away, and in natural disasters do far better by bike (last thing I’d try to do would be leave the city by car and add to the panic gridlock).

            If a carpark levy pushes someone with 3 or 4 cars out to the suburbs, that’s a good thing. Less resources are used in housing those cars in a carport or driveway. If people place too low a value on expensive car storage in the cbd, that’s something pricing can fix.

          5. Heidi – are we also going to levy hoarders who live in a family sized apartment in the CBD even though the kids have left and have their rooms full of possessions they will never need?

            Very few people will do this or store 3 – 4 cars simply because the space is so expensive. I don’t see why we would waste any time intervening in the lives of the few that do, there are far bigger issues.

          6. Ooh, it’s a bit late at night to get me on that subject, Jezza… my tongue’s already tutting… Herne Bay’s decreasing density needs a bit of a shake up…

            A car levy wouldn’t be there just to put pricing pressure on the rare people with 3 or 4 cars, though. As in the NSW example above, it would be used in certain areas as a behaviour modifying mechanism to reduce space given over to car storage, putting our resources to better use and encouraging sustainable modes.

            Having bought an apartment with a carpark, perhaps only a yearly levy will prompt an owner to revisit whether it makes good financial sense.

          7. That levy could very easily convince that person that it is better to live out in the suburbs where they don’t have to pay it at all and end up driving more often.

            It’s the kind of levy that will result in cries of nanny state. That doesn’t tend to end well for Labour governments, a return to National in 2020 would be far worse than a few cars parked in apartments in the CBD.

          8. Then let’s return to my original proposal that the levy is on parking across the city.

            Radical = relating to or affecting the fundamental nature of something; far-reaching or thorough.

            Why tinker? Radical change is required. Lett’s do this.

          9. How would you define parking? Some people park cars on the lawn, others don’t.

            If the problem is the emissions, then we need to tax fuel properly, if the problem is road space then we need to allocate it better, and make roads better for locals rather than people passing through. This would inevitably reduce driving.

            Taxing the storage of a specific item on private property is a very roundabout way of solving a movement problem.

          10. My argument against maximum residential parking rules in centres at the PAUP was that if a household has 3 cars because the a three single people, isn’t it better for them to share an apartment in a centre where they can leave two cars at home each working day? In transport terms that is far better than only having centres occupied by retired people and people who will be carless anyway by choice. But logic didn’t count for much against the Council. They thought if they made a rule then people would live there anyway and obey their rule.

          11. + Heidi on all this above.

            @mfwic ” Not to mention natural disasters. ” – now come on we have all seen the US motorways in those disaster movies when everyone has to leave town :0

          12. Completely agree with miffy on this one. Far better to have people living in major centres and owning cars than living in the suburbs and driving.

            The problems with driving are:
            Fuel emissions – Tax fuel for the emissions.
            Embedded energy – Tax cars at sale or registration for the embedded energy, reduce as they get older as the embedded energy cost is pad
            Congestion – Charge people who congest roads
            Air pollution – Tas fuel for the emissions and the resuspension equivalent

            A parking levy is a dumb way to charge for good reasons. Charge the thing that causes harm, not a proxy for it.

          13. Grant, before Hurricane Katrina the people with cars caused congestion for a while but got out. The people without cars didn’t. Don’t expect a bus service or rail to be operating and even if it is don’t expect to take your emergency food and water with you.

          14. Tell you what, SB, you convince Jezza and mfwic on the need for a car tax that properly pays for the embedded energy and resources, and I’ll stop calling for a levy on parking. 🙂

          15. I am already convinced thanks Heidi. We should already have a carbon tax to cover emissions and a congestion charge to cover unpriced externalities. We already have levies and taxes to cover the health costs and accident compensation and the Government takes a bit more just because they can. As for Katrina I don’t know but it probably wasn’t the people who couldn’t get away so took refuge in their attic space. A car is every bit as important as good shoes and three days of food and water unless you want to try quaxing away from a pyroclastic flow.

          16. Don’t know much about Katrina but a pile of government hired buses could sure move a pile of poor people (that probably don’t even have cars or 3 days supply of food & water) out more efficiently than every man and his dog in a car.

          17. I don’t think levying a private car park is the right way to go. It adds to the cost of owning a vehicle rather than addressing congestion, which is when many people want their car out of their garage at the same time. I prefer the road pricing idea.

            But the thought did occur to levy homeowners/businesses for on-street parking as part of their rates. And if say 70% of homeowners/businesses in a given street didn’t wish to pay the on-street parking levy, then yellow lines could be painted down the road increasing the capacity of the road/street for through traffic. It might be a way of making cycling safer or enabling an additional car lane.

            Just a thought.

          18. @Sailor Boy – Yes your clear pointed argument is quite convincing. Have to think about it more. I’d agree the parking idea is crude, but may work to some degree in fighting congestion if you could also tax driving through a city at the same time. I see that Sydney scheme is full of exemptions and looks like a big overhead to implement.

            It’s perhaps a question to tackle a different problem than congestion: Should we tax storage of large items in a dense city area given there is a housing shortage. Remove the storage and we have room for more housing of people and not vehicles.

          19. Thinking more about it, where in Sailor Boy’s list can we capture the costs to society due to the spread-apart geometry of the city due to the car? These social and health costs associated with car dependency are a result of:

            1/road space
            2/parking spaces?

            1/ is perhaps best split between fuel tax and congestion charge. But isn’t 2/ best captured by a parking levy of some sort?

        2. Yes interesting what is a reflection of the true yearly cost of a carpark: yearly A$2,390 for City of Sydney. North Sydney and Milsons Point business districts for example.

      1. You could legislate a levy on privately owned parking spaces. I believe this is done in the Melbourne CBD. The levy compensates for the external congestion cost that customers create in getting to and from the car park.

    2. Parking pricing exists in the suburbs within walking distance of the city centre in the form of “Residents only Parking Zones” in Parnell & Ponsonby. While I find these schemes fundamentally abhorrent in that they effectively transfer public property to private use they have had the effect of forcing those who parked all day for free in those zones to either; a)stump up and pay for their parking, b)park further out & walk much further c)switch to PT to get to the city d)a combination of b) & c). All bar a) are +ve outcomes in terms of reducing SOV congestion and go in some way towards mollifying my abhorrence of the scheme’s fundamentals so maybe we should extend further, into the streets surrounding Newmarket, say.

      1. Soon to happen in Grey Lynn, probably, if the recent submission process has the expected outcome. I’m interested in whether AT will monitor the parking and especially the Hide and Ride in the adjacent suburbs this time. It would be useful data to have.

        An alternative to a residential parking scheme which doesn’t have the same problem of transferring public property into private use would be installing cyclelanes, and removing all the on-street parking. Far too radical of course, but also far more equitable. It would provide excellent cycling infrastructure, effectively also making the area more walkable. Inner suburbs such as these already have far better PT than elsewhere, and residents don’t have far to go to city hop or rental car outlets. These are also areas which have resisted intensification. Had the nimby regulations not been in place, intensification would have meant there was no effective parking per apartment on the street anyway; it’s not like these residents have any “right” to on-street parking.

      2. Yes, but at what cost? SOV goes down, but journey times go up, time with family and time outside of work go down. It’s fine if you get to set your own hours, but not everyone has that luxury. But some people get to feel good about less SOVs, regardless of the impact of other’s qualtiy of life. So there’s that, I guess.

        1. Whose journey time goes up? We’ve already seen that cycling journeys are often quicker than PT and driving. Making it even easier and safer in the inner suburbs will increase mode share and decrease journey times.

          1. Sorry, but if you’re going to slug an entire region, making life even easier for the inner suburbs doesn’t cut it.

          2. But to get to the city and city fringe areas for employment or business of any kind, you go through the inner suburbs; that’s the importance of the geometry. Most people would complain about my proposed idea because they think it would be an infringement of the residents’ rights to park there. Now you’re saying they’d be unfairly benefited.

            Let’s get to the heart of this. Instead of giving the residents unfair rights to parking on the publicly owned street, why don’t we instead advantage people cycling through and using PT/walking combos to access the areas. It doesn’t reduce parking options for people coming from further afield, they’ve already had that removed by the residents’ parking zones.

    3. For starters we could just demolish one or two AT parking buildings & if they charged more market rate for the others it would perhaps help people mode shift. Wilson’s & Tournament could then charge perhaps more as unfair competition would be removed.

  10. Does anyone know the government’s stance on what will replace fuel excise once electric vehicles become widespread? Because there’s a good chance this will happen sooner than 10 years away. If some new pricing system (potentially GPS based) needs to be rolled out in the next decade to replace fuel excise, this could force Auckland’s hand.

      1. And is NZTA’s planned mechanism, once the EV fleet reaches 2% of the vehicle fleet.

        At that time EVs will pay (based on what the current RUC rates are for light (<2.5 Tonne) non- petrol or diesel powered vehicles pay now), about 6 cents a km in RUCs. or about $840 per annum if driving 14,000 km a year.

        Same exemption applies too for heavy vehicle EVs such as EV trucks and EV buses, exempt RUCs til they make up 2% of the heavy vehicle fleet.

        That exemption is potentially worth a lot of money to the right people. Yet doesn't seem to have caused any changes with regards deployment on the roads of heavy EVs so far. Other than a trial of a couple of EV buses.

        1. EVs are scheduled for RUC automatically when they hit a certain percentage of raod vehicles after which the OPEX cost advantage dissapears, the smarter option is non-pulgin Hybrids, it delivers 90% of the benefit of a plugin hybrid in-terms of fuel economy like a prius but for in the case of a corrolla something like $350 more over base price……

          Best bit, government doesn’t recognize non plug-in-hybrids as hybrids, so they give you the economy and tax advantage of a hybrid, for virtually no additional money over a conventional car, and when they hike taxes on hybrids, your far more likely to be unaffected.

          1. There is no tax break for non-plugin hybrids, they pay less tax because they use less energy, same as a fuel efficient 2017 car will pay less tax than a gas guzzling 1974 Kingswood.

        2. There has been some good debate following the Tesla truck announcement. At the moment, apparently, its range and payload are too low to replace long-haul, which is where new trucks often come in, but as a new truck it is pitched at a task share that older trucks get rotated into, so is too pricey (for now), even with a RUC exemption (in the NZ context).

          Still, a focus on urban rigids like buses and rubbish trucks is good from an emissions point of view, and minimises the revenue risk you’d have if the semi’s all moved to EV in a rush.

          1. Metro delivery and long haul trucks are generally different types, so there is not a lot of retiring long haul trucks to metro duties. There are older and newer versions of both.

          2. It was US commentary, so I imagine their market differs a bit from ours… Point being the vehicle needs to be task appropriate from a whole of life cost point of view, and urban rigids seem to be where the practical vehicle development strides are being made.

          3. If metro delivery and long-haul being different types means they are a different size, long may that continue, but the trend seems to be we have B-trains regularly on our suburban roads now. Often avoiding the motorway congestion…

    1. It would likely be the existing RUC system. I expect people would have the option of using an electronic system or using the existing system where you buy a chunk of kms, so it is possible that not all vehicles would have GPS tracking.

      1. As a matter of curiosity what would the RUC be if all roading costs were met by a direct charge? i.e. no fuel tax, no ratepayer contribution etc. Just the total road budget divided by total kilometres driven.

        1. It would be the same rates as now, because the tax share from average (light) petrol vehicles is matched to that of average light RUC vehicles. Individuals would see differences though because the averaging to align the FED and RUC systems pull things about a bit differently. But no large scale difference.

          1. Why would it be the same as now? Around 51% of vehicle-km are on local roads and around 50% (higher in Auckland) of local road costs are met from rates.

          2. Sorry – missed the ratepayer bit. Yes, that would see more – one third to one half as much again potentially, on average across all users, depending on how you want to treat farebox recovery perhaps?

            But a bigger share of that increase would go to heavy vehicles rather than lights given the maintenance component from rates, also since there are a bunch of nationally funded common costs, that rates don’t contribute to, that are already included in the light and heavy vehicle charges.

          3. “But a bigger share of that increase would go to heavy vehicles”

            Quite so, and some information I have recently uncovered gives an insight into the vast scale of the heavy-vehicle-induced maintenance costs imposed on Auckland ratepayers. If trucking companies paid their way on local roads to the local authority there would be no need for fuel tax increases. Ratepayers are subsidising trucking companies rather than car drivers.

          4. MFD that is my understanding too. Good question Niall. As a follow up question how difficult would it be to move to a system where ratepayers were not subsiding motorised road users?

          5. MFD I understand that changing road funding to a fully RUC system would be politically challenging. Probably more difficult than a non revenue gathering focused congestion reducing road pricing scheme that Matt is discussing here. But it would help solve the infrastructure deficit problem that Auckland and other Councils have.

          6. Roads are a public good. Why would you shift to a complete users payers system?

            Everyone gains value from deliveries to their local supermarket, store, etc.

          7. Nicholas I suppose because there are hidden subsidies for some transport options not others, which has implications for promoting sprawl and favouring automobile dependent housing over transit orientated development etc Moar roads is reaching its limits as a sole solution for NZ cities and the country needs to alter its systems to move forward

          8. That’s not only about transport. That is also about land use. It’s not so clear cut.

            I think pure user pays for roading is a bad model and it does not encompass everyone who benefits from every trip.

            Fundamentally roads are public infrastructure. Demand management is good to push people to the right types of transport. Supply management is important to provide this right types of transport options and also to send signals to land users regarding urban form.

          9. Nicholas that is a balanced and reasonable view. I agree that non congested roads are public goods. So they will need some sort of public funding mechanism. I am not sure though that the current mixture of fuel taxes, road user charges, rates and potentially congestion charging (which i support -the sooner the better IMHO) is the best funding mechanism. Especially, I am not sure why rates need to be part of the mix given the debt constraints and infrastructure deficts our local governments are experiencing.

          10. Quote from an Auckland Council document:

            “NZTA allocated $1.28 billion to Auckland Transport during the 2012-15 NLTP period
            .
            Auckland Transport’s road maintenance and renewal expenditure for the same period was approximately $783 million ($261 million per year) of which NZTA contributed approximately $254 million ($84 million per year)

            The $529 million shortfall was funded primarily by Council rates.”

            So of AC’s road maintenance budget for the period 2012 to 2015 RUCs and fuel taxes paid a third with ratepayers picking up the rest. This maintenance is primarily required due to the effects of heavy vehicles.

            Let’s take a look at just one trucking operation; the proposed expansion of Brookby Quarry.

            “Brookby quarry is the most recent quarry in Auckland to propose a major expansion, and as a result it is also the quarry on which Auckland Transport has the most information. The rural local roads surrounding Brookby quarry are not designed to a standard to carry high proportions quarry truck loadings. The degrading effects on these roads are significant and are projected to halve their 25 year design life before needing to be renewed again.
            It costs $750,00013 per km to renew a local road across its 25 year life where a local road is not being subjected to a high proportion of quarry truck loadings. The road will last its intended 25 year life cycle.
            By comparison, Auckland Transport’s Southern Road Corridor Manager has projected that the renewal costs (attached) for the roads surrounding Brookby quarry will increase significantly to $2,250,000 per km over 25 years. This is approximately $37.5 million of additional renewal costs if we include the 20km of road (within a 10km radius) surrounding Brookby quarry that are used heavily by quarry truck
            traffic.
            This is a significant adverse effect of the quarry which should be spread fairly across the quarry operator’s customer base rather than being subsidised by Council rates.”

            Roads a public good? Maybe, but why should a private company who, through their actions are steadily destroying that public good for profit not be required to meet the costs that they impose on the system? Why should it be the ratepayers?

          11. Sounds like Brookby Quarry need to pay for strengthening of the surrounding road network.

          12. You are missing the point somewhat. It’s a single example of a trucking operations costs imposed on the ratepayers. There are many, many more.

            The salient points are:
            AC’s road maintenance costs are high.
            The bulk of these costs are due to heavy vehicle traffic.
            The operators of these heavy vehicles pay for less than one third of these costs.

          13. NZTA did some funding history when reviewing funding assistance rates.

            If I recall correctly, originally rates paid for local roads because they are local assets that needed to be in proportion to local needs and means. Road taxes that evolved into today’s set came in once it was decided to create State highways – that no region wanted to pay for because everything went by ship or train.

            Funding assistance today is a subsidy from national road taxes paid to local bodies. Retaining some degree of local cost share has been philosophically desirable because having local roads as a free good never ends well for anyone.

            Regarding moving to RUC: paper-based RUC is about 40-60 times more expensive to collect than FED. Most light diesel owners, and in 5-10 years a whole new class of EV owners, are profoundly uninformed as to their obligations to pay RUC. Over-coming the surprise and the transaction costs are the big acceptance hurdles – that and that sometimes even 1000km of RUC is too expensive in some months for some families.

          14. So the current split funding regime for roading (operational and capital expenditure) was designed to pay for moar roads -a national wide set of state highways?

            Local government is stuck with a significant proportion of the maintenance costs -even though they have no power to regulate how much damage heavy axle vehicles do to the roads.

            Local government also has very little ability to influence the creation of new roads as the big decision maker is the central government state highway builder and the small decision maker (wrt new roads) is housing developers producing new greenfield developments.

            Local government can only influence the latter in the negative sense by restricting greenfield growth. They cannot do positive urban planning, for instance, local government lack the funding mechanisms to design and build new greenfield housing development around public transport (TOD)

            Many early suburbs in NZ were opened up by public transport -but that history has largely been forgotten.
            https://teara.govt.nz/en/public-transport/page-2
            https://teara.govt.nz/en/map/10370/the-expansion-of-christchurch-to-1926

            For some reason it is considered beneficial that local government continues to responsible for a large percentage of road costs. Why?

            When EV’s become widespread the natural switch is to an electronic GPS based system not the cumbersome paper based RUC system -presumably the transaction costs of a GPS based system would be minimal . Uber for instance has no problems with this system for charging their customers for using their vehicle fleet. Is there a reason preventing this being done on a national scale?

            To me this whole rates and roading funding system seems to be stuck in a massive public perception that the status quo is the only way to arrange the system -so it is restitive to innovation and change.

          15. Truckies probably do 95% of the damage to the roads. Do they pay 95% of the taxes?

            “The study found that essentially, road damage was related to the 4th power of the relative loads. That means that if one vehicle carries a load of 1,500 pounds per axle and another carries a load of 3,000 pounds on each axle, the road damage caused by the heavier vehicle is not twice as much, but 2 to the 4th power as much (2x2x2x2 = 16 times as much road damage as the lighter vehicle).”
            https://www.denenapoints.com/relationship-vehicle-weight-road-damage/

          16. Truckies definitely pay their share of central government road maintenance costs. Under the current model, if you shifted more of the maintenance burden off councils and onto the NZTA, then heavy RUC rates would go up to recover it.

            So it’s not about truckies and whether they pay a fair share. It is about political choices around allocating responsibility for baskets of costs between central and local government.

            Councils and communities want businesses, products and services. these things generate demand for roads and for road transport, including trucks. Trcuks are not some foreign thing that turn up, cause harm and leave. they are attracted by what locals want and do, OR they pass through on the State highway that locals do not pay any rates towards.

            Councils can use bylaws to restrict heavy vehicle access, and do so quite often to protect areas or structures. However, councils also sometimes chose to consume their roads more quickly: those axle loads on urban double-decker buses aren’t feather weight. Given that roads wear out even if you don’t use them, it is ultimately about making choices on the best way to consume them for the range of community interests involved.

            Check out this page for the make up of costs as currently allocated by vehicle class (per 1000km): https://www.transport.govt.nz/land/roadusercharges/where-does-the-money-go/

          17. The problem Tutehanga is that Councils in NZ cannot change its transport resource allocation. They cannot decide that the moar roads spatial design of their city is no longer working and a new framework is needed -because the central/local government funding arrangement is locked in.

            If road users paid the full cost of of their use -including externalities like congestion, pollution and accidental injury/death then this wouldn’t be an issue. But they don’t -not even close -there are all sorts of hidden subsidies -mainly in the direction of moar roads and away from urban areas offering a multi-modal transport resource allocation.

            Congestion pricing would be a good step forward. In fact for Auckland, it is essential. Auckland and the country can no longer afford the moar road model -probably the only person who disagrees with that statement is Stephen Joyce. The lane km costs of new roads for Auckland are increasing at a ridiculous rate. Check out the graph and explanation here.
            https://www.greaterauckland.org.nz/2017/08/01/escalating-costs-building-roads/

    2. If it happens too soon we will be in trouble. It isn’t as if the electricity network and generation we have is sufficient to power every business and household plus every vehicle. Where does the extra supply come from? We can either dam and flood more pretty places or open new coal stations or build that nuclear plant near Thames. Other than that you would have to price power so people only charge their car when the wind is blowing or the sun is good and bright. Imagine the downside of that level of demand management. Poor people going cold and hungry on cloudy windless days.

      1. I’d always assumed that EVs shouldn’t pose too much of an issue for electricity supply, because they can do most of their charging overnight when there is space capacity anyway. We might just need sufficiently dynamic pricing so that people are incentivised to charge in the middle of the night.Or is that wrong?

        1. Sort of right but also wrong. While there is spare generation and transmission capacity in the middle of the night most of our power is based on stored energy. Ie. Hydro lakes. More total daily demand would mean more generation required as the lakes are limited particularly in dry years. It would be ironic if we needed to burn more coal or gas to feed the EVs. Having said that I’m sure my next new car will be one.
          Probably the best solution is parallel increase in home or local generation and battery storage technology .

          1. I would expect as time goes on future improvement to battery efficiency & other such things and say solar panel technology built into the car surface would help with generation. I don’t’ think we need to fret. We must have tonnes of Hydro in NZ but I know we lose a lot of it transmitting it up to the upper North Island – if technology can improve that it would go a long way in helping.

      2. I was under the impression that a lot of new renewables generation capacity had already been consented, too, so there is some capacity to expand if other mechanisms aren’t able to smooth demand.

      3. mfwic is right. The sort of level of energy required for our transport needs is too large to consider doing it all with electricity. Here’s a current graph from MBIE showing where we get our energy from:

        https://i.imgur.com/3n8tuOR.png

        Assuming we all agree we can’t accept the environmental damage involved in increasing hydro any more, a reliance on electricity for transport means we’d be expecting somehow that the thin green “other renewables” line could explode to take over a big proportion of the purple section. That’s not realistic. This chart gives the emissions from combustible fuels and shows that not only does transport produce the lion’s share of fuel emissions, but it’s the sector that’s increasing out of control.

        https://i.imgur.com/2ShRyKc.png

        I like the chart because it shows how out-of-whack our transport has been with everything else. We’re using more energy for transport due to poor planning and car-dependency, not due to economic activity.

        While renewables can contribute to our energy supply, there’s no way they can cope with our current energy needs for transport. And the most important thing is to reverse that direction the transport sector is heading, by reducing our car dependency and embracing sustainable modes.

      4. Plenty of spare hydro capacity at night and even during the day. Most dams must let water flow during the night even if they aren’t selling any power. So it’s like our “batteries” are constantly leaking if we don’t use the power it is lost forever.

        And it’s not like we replace our entire fleet over night. it will happen gradually. Solar power and batteries keeps dropping in price at which point it is worth the investment which would help add a large amount of capacity. Granted, we aren’t Australia, but they are installing a power plant’s worth of generation every year. We could do much similar. And if the smelter down south shut down, we would have a bunch of capacity from that dam.

        Also Heidi, I would be interested to know the makeup of those energy figures. The graph is in joules. When it refers to oil energy consumed, is that the net energy of work done, or just the simple gross energy consumed?

        The reason being that an electric car makes better use of electricity, than a car does of combusting fuel which is mostly wasted as heat. A Nissan Leaf does 100 MPG and a Toyota Corolla does 35 MPG. So just using that if we replaced our entire car fleet with Nissan Leafs, in theory our oil energy consumption for car transport would disappear and our electricity consumption would increase by 1/3 of that amount. That seems like a good trade for the economy and for the environment.

        Of course there is the problem that we already have too much hydro and with climate change going on, we don’t want to risk any more hydro, so new generation will need to be local wind, solar, or other.

        I would even wonder if there is a theoretical benefit if we got electricity from burning oil to power EVs instead of combustion engines. I would think a power plant is more efficient at recovering energy than an engine. I think that even moving away from importing foreign oil and burning biofuel from local crops would be better (carbon neutral).

        1. Expecting the green “other renewables” line to quadruple isn’t that unrealistic is it? Given the price plummeting of solar and wind. I was under the impresssion that we could fairly easily build lots more windfarms that stack up technically and economically, but up till we haven’t because they’re difficult to get through the RMA, the way it is currently set up.

          1. My two concerns are:

            To reduce our carbon emissions, people are expecting the green line to replace the coal and gas lines too.

            There’s lots of induced traffic still to eventuate from the road building of the last few decades, even if we stopped building roads right now. So vkt will continue to rise, faster than we can increase our solar and wind power generation.

        2. The joys of solar: smart homes can be programmed to buy and store power in batteries when it’s cheaper and the sun isn’t out.

  11. I’m not a road pricing fan at all due to the outcomes on poorer people, but I can’t see any real disadvantages to a city centre peak time entry charge (and exit maybe). The less cars in the city centre the better IMO.
    Although it might be cheaper and more flexible to implement a car park tax.

  12. Agree with the post, probably need to wait for a decent PT & better non-perverse system to be implemented. Though in say 5 years, just before CRL opens I suspect things are going to be really creaking at the seams in areas. If a CMJ, (& Waterview?) motorway toll system could be done in that time it may have merit, but would probably be more pain & political suicide than it’s worth.

  13. A city centre cordon would be relatively easy as there are only about 15 roads into the CBD. Not sure whether a cordon that small would be worthwhile though.

  14. In Auckland as at present over 66% of ‘public transit costs’ mainly OPEX costs care paid for by road users and property owners through council subsidies and diversion of money likely unlawfully which is ringfenced for road spending. In cases of rail the situation is exacerbated by CAPEX being 100% subsidised with zero expectation of a return on investment.

    Before talking about shafting automobile users who are 85% of people with yet more taxes to pay for yet more ‘transit’ for the benefit of a very small number of people comprising a mere 15% of the population we should talk about getting that 15% to pay their fair share, thereby freeing up many hundreds of millions annually in Auckland which will be available to expand roading capacity..

    We simply can’t expect to double the supply of housing in the inner suburbs through infill development, then expand additionally on the periphery, and not shell out anything for any additional infrastructure, for sewrage, roading and electricity. The 1 lane roads like mt albert road, much of new north road, sandringham and dominion roads, parts of greatnorth road, edmondt road and all our other arterial roads which were built over 50 years ago to handle such a huge increase in traffic.

    Over 40% of the population of auckland is immigrants, that shows over the last few decades the rate of growth of our city… And the problem is that when you have local roads that are inadequate, interchanges/intersections that are inadequate, then the traffic starts to back up from the weak link, and causes other intersections along the route to fail to clear the necessary number of cars, in some cases this is backing up onto the motorways.

    The motorways need more lanes, they need better lane discipline, less lane changing, less trucks (which can only do 90 legaly and many times struggle to do 80 going up hills) in the middle and inner lanes. The motorways need larger slip lanes, with more opportunities to merge, we need to decrease the speed limit in the outer local lane to 80 or 90 to facilitate mergins, and increase traffic flow, and we need minimum speeds on the motorway onramps, because people will drive the entire length of the onramp at 60, accellerate at the last minute, and that slows the entire outer lane down to a crawl…

    What happeneds when the outer lane is at a crawl, it spills over, people merge from the slower lane into the faster one, the speed diferential means the faster lane slows down, people push into the next lane, and the whole motorway grinds to a halt. It backs up, and causes issues downstream…

    TLDR: Before taxing motorists more, we need to spend the money they currently pay in tax on the roads, and we need to address undercapacity, and many tecnical failures across the roading network causing systemic and chain failures.

    1. Holly your proposal is just a continuation of past failed policies.

      Building wider roads just encourages more people to drive and the roads end up just as clogged as ever.

      This is now nearly universally recognised in Auckland, see for example the original ATAP under the last government that said we can’t build our way out of congestion.

    2. ‘shafting automobile users with yet more taxes’

      This is not the aim. The aim is to *replace* part of existing taxes with a charge that is more responsive to how much congestion you cause.

      A congestion-related charge is an incentive not to drive at the most congested times and places. People who attach less value to driving at the most congested times and places will be more likely to make other arrangements (travel at another time, arrange their business to make fewer or shorter trips, use public transport sometimes…) The result is a quicker trip for the people who do value being on the road at that time enough to make them willing to pay the charge.

      How much you should tax motoring in total is a different question.

      1. How about:
        A.) Removing that portion of tax being diverted away from roading and
        B.) By act of parliament place leans on local councils and busing companies for the value of the money diverted, then
        C.) Enforcing the leans through the bayliffs, liquidating those organizations assets and
        D.) Either return that portion of the money which was recovered to the motorists or alternatively spend that on building more capacity
        E.) Allocating funds to regions in-line with the revenue raised in each district, then putting Leans on all the roading in areas that have been over-allocated, and transfering those funds to areas that have been underfunded like auckland.

        That would be more in-line with the rule of law in a first world country, afterall just because you steal something or receive stolen or diverted money doesn’t make it yours, it just makes you a party to the criminality and corruption. Heck the former head of Auckland Transport is looking like their going to enjoy a nice long trip to the prison…..

        And if we are going to have high-priority lanes I do prefer they not be taxed, people who are worth being in a high-priority lane do pay enough tax already, it’s actually a loss economically to the country as a whole if say a high-paid project manager wastes time traveling on congested roads, so the project needs to hire another project manager, or your billables to Delloites are inflated several percent because of traffic….

    3. Wall to wall nonsense. 25%of PT opex is from Roadusers. After all they are direct beneficiaries of those PT users not driving! Another 25% is from ratepayers, who are of course also users, and 50% is from ticket sales.

      And as for road widening helping users more than building alternatives well that’s total bumpkin… traffic congestion is, of course too many drivers, not not enough lanes, as every new lane brings more drivers; this approach has never worked anywhere.

      Enjoy your day.

    4. Holly,

      You listed a bunch of congested old arterial roads in Auckland. The valuable thing about those roads is the real estate itself. “Drivers” have never bought or paid for that real estate, they have just assumed use of it through political means. If we actually charged motorists the true costs of using these roads, they would be paying a lot more than they are now.

    5. Holly motorists have been gifted billions of dollars of land for roads which they don’t even pay rates for. And no one expects a return on investment for that land. Its hard for land efficient PT to compete with land inefficient roads when the land is gifted for free. Lets charge road users a 5% ROI on the value of all land under roads and see if PT can compete without subsidy then…

      1. Jimbo you make no sense, NZ has the land mass of the UK with a population of 5/65ths or 1/13th or 7.7% of the population of the UK, yet you go rave on about how ‘roads are taking up all the space’, we have no shortage of space in this country by any measure other than what and where you are ‘allowed’ to build on, in this socialist failure of a country…

        Now if you were to remove the RMA and the Statutory Rural-Urban Boundaries, then there would be no spacial planning restrictions and the value of land would trend down to that of rural land, a few thousand an acre and we would have no shortage of housing or building materials, food and anything else sold in a retail store would come down, the city would spread out several kilometers in each direction and the country would prosper.

        1. Holly, all land is not created equal. Land, particularly land that forms continuous transport corridors, within our major cities is scarce and valuable. It makes no difference there are millions of hectares in the southern alps.

          1. Land is not scarce, objectively we have 13x the land per person in this country as in the UK, now if we were in the UK you have a point, kind of, not really though. As most of the countryside is left untouched and unfarmed, and frankly is worth more as residential and comercial land in terms of the pleasure and utility people derive from it, and in terms of the economic output per capita generated from it.

            The scarce land perception is a lie and a myth, there is no shortage of land in NZ, and the only reason why it costs so much in the cities is because of the RMA enabling councils to restrict and control density and land usage, and the rural urban boundary restricting the sum total supply of developable land.

            Imediately outside the rurual urban boundary land prices drop signficantly. FYI most of the houses that would be destroyed in the process of widening roads could be relocated economically to new sites on the periphery.

          2. Land is scarce within cities. Location location location. People want to live in cities. It is likely with more liberal land use regulations the price of land will fall, however its not necessarily the case and you with still have an increasing price gradient toward the centre of cities. Once you liberalise land use within cities, this will tend to push up the price of land as it will be able to be put to higher value uses (eg apartments). In addition, once you have a carbon price that reflects our international commitments, this will tend to reinforce lintensive land use in cities. In any case the price of the land under Gt North Road is not and will never be zero. The fair lease costs on that and all other land under roads in the city will be a lot more than motorists currently pay.

        2. ‘the value of land would trend down to that of rural land’.

          What a load of bollocks! Land near jobs and facilities would still be worth much more than land that is not. Tauranga has very few restrictions on building out yet the land nearest the city centre is still worth more than anywhere else, just as it is in pretty much every city in the world.

          1. With modern transport technology meaning. cars with sufficent road structure and capacity i.e. arterial roads without housing, adjacent, seperated by median barriers with CFI (Continuous flow intersections) operating at 75KPH like melbourne, and supported by motorways rated for 120Kph, then one can travel well in excess of 50 Kilometers within the average US commuting time of 30 Minutes…

            This means the premium on land nearer the center of the city is signficantly reduced from what it is now, as now everyone for quiet some distance is within reasonable commuting distance to the city core, meaning that all land trends towards the value of rural land.

            Now its true a good location, a desirable beach, a centraly located or well connected piece of realestate will always command some type of premium, but the majority of land including that which arterial roads are built on should not be much more than rural land free of government intervention in the form of urban-rural-boundaries and spacial planning…

            Now the problem we have with your advocacy of a CBD is that it is promogulated on the enablement of ‘public’ transit. And if you stand on a hill and look down at the northern or western motorway you see 80% of traffic flowing in one direction, either to the CBD or away depending on the time of day whilst the other lane is virtually empty. In essence we have what is likely sufficent motorway capacity, the problem is that we can only use about half (one direction + a bit) at a time…

            If we had another CBD built at say hobsonville, it would balance out the traffic flow, as traffic would be flowing into and out of two CBDs in two opposite directions, this would fix transport problems in west and north Auckland… This would also enable development on the perihpery. The same should be explored for Mt.Wellington, etc..etc..

            Unfortunately they took hobsonville (some of the only flat developable and well located land in auckland) and covered it in cheap disposable slum housing that will be expensive to clear and develop.

          2. Where are you planning on putting all of these arterial roads and motorways? Are you going to demolish houses to allow someone to build a house further out and travel at speed to get to work? That is the definition of insanity.

            Also your free flow utopia that doesn’t exist in any city (definitely not Melbourne) would be extremely expensive to build, you would have to hike fuel taxes to a level where most people would not be able to afford to travel. How do you propose they get around?

    6. Holly, if we’re to have more growth, it needs to not create more traffic. Cities can manage this, but only through investing in good PT and active modes. Increasing road capacity increases car dependency and vehicle km travelled – that’s in about as much doubt as climate change is.

      You may not want more growth, but that’s another discussion.

      1. Competition is good, so I encourage and congradulate competition, but taking money from 85% of commuters so that 15% of commuters can pay 25% or thereabouts on average of OPEX and for Rail and Trams 0% of CAPEX is not competition.

        It is socialism and a blatent and clearly given how few people it has convinced, a completely failed attempt to force people into a socialised form of transit which is outdated, unwanted and completely uncompetitive for what is purely ideological reasons.

        With proper roads, road structure, and sufficently well built motorway capacity I can be on an onramp in say 3-4 minutes and then cruise at 120kph, off the motorway for 3-4 minutes and straight into the carpark or parking building at my destination, that allows me to travel 48Kilometers, now on a subway I can do 7Kms at best if I am within a few minutes walking distance to the stop…

        In terms of the effectiveness of the technology, the cost efficency and whatnot there is no comparison…. And frankly it shouldn’t even be a discussion, rates were for core services and fuel taxes for roading, neither were ever intended to be diverted to prop-up an obsolete form of socialized and communistic transport that nobody wants…

        Now I have no problem if a private bus company wants to pay the council and property owners for land to create slip lanes and parking bays off of the main road, so that they can drop-off and pick-up passangers, but other than that frankly there should be no governmental involvement. These ‘competing services’ should stand on their own two feet as equals against the automobile based on the value they bring to the table…

        And I think its very corrupt of our politicans to allow the land transport fund, paid for by motorists and for property owners to have their wallets pilfered to prop up this technology. Its frankly anti-competitive, and anti-consumer, and its the sort of behaviour we would expect to see in a despotic 3rd world bannana republic and not a leading western nation.

        1. I think you might need to go read up on “externalities” in your economics textbook. Essentially road users benefit a lot from a functional public transport system and therefore it’s completely justified for road users to help meet the cost of running PT.

        2. ‘its the sort of behaviour we would expect to see in a despotic 3rd world bannana republic and not a leading western nation’.

          This happens in most first world countries, mainly because they have realised the best way to reduce traffic congestion is to tax vehicle travel and subsidise PT. It is far, far cheaper than throwing money at expensive road projects that do little to alleviate congestion.

        3. “It is socialism and a blatent and clearly given how few people it has convinced, a completely failed attempt to force people into a socialised form of transit which is outdated, unwanted and completely uncompetitive for what is purely ideological reasons.”

          If you think its outdated, then I think you need to get out of NZ and see what the rest of the world is doing in this space. It isn’t (with a few exceptions) building roads. They have learnt from their mistakes and recognise the scarcity of land in cities and what is the more spatially efficient mode.

          And if you think it is unwanted, check out the growth of numbers using the Busway and Britomart. Staggering. Not to mention mass transit as a success everywhere else, globally.

          But let me guess…NZ is different, right?

          May I also suggest you look up the definition of socialism…….

          1. Its not a thought or a feeling, it’s nothing to do with what I think or what my views are, its 100% factual that arround about 85% of all trips are done by cars in auckland 15% by ‘public transport’ and that figure is not much lower in London, even with congestion 10x worse and all of that money spent on subways and other crap that the overwhelming majority of people objectively don’t use, therefore are not interested in and don’t want…

            And there is always a small fringe group of extremists in any society that will believe in all sorts of whacky religious or political hogwash, the fact is that it is a socialist form of transport, because the cost of the transport mode (in auckland about 2/3rds of OPEX is bourne on society as and at large, and infact 99% of comments on this blog and in this thread are advocating just that, socializing the cost, and they makey every argument under the sun that ‘well car users are really benefiting from buses clogging up their streets and stopping ever 500 meters…)…

            Also fun fact, half of all people have below average intelligence..

          2. You said its outdated and unwanted. Outside the world of the economics 101 textbook, thats clearly fantasy. Here and abroad.

            But by all means, put those 15% back into cars, into road space that is already at capacity, with no room in Auckland city to add any more, and see how your congestion fix works. I prefer the method that gets enough people out of those cars in the first place. See the Harbour Bridge at peak every morning.

            An save the personal attacks if you want to be taken seriously. Or go to Whale Oil and vent there.

  15. I am really concerned that the justification for price-based rationing of road space is justified by an analogy with bread (which we would agree works) as opposed to, say, one for health care. Imagine if the hospitals put an extra charge on emergency care if you got injured at “peak hours”. That’s the kind of thing we’d expect from the nightmarish US system.

    Price rationing may be “economically efficient” but it is necessarily more burdensome on the already burdened, and I can’t support it without compensation.

    1. The health system uses triage as a way of managing demand, if it used the same system as our roads the person with an injured thumb would get treated ahead of the person with meningitis simply because they turned up first.

      I agree though our PT system is not ready yet for price-based rationing. People at the very least need a realistic alternative.

    2. Well also bread is not really demand priced, the supermarket doesn’t dynamically change the price according to demand, if the demand is too high they just run out.
      My broadband vendor could charge me more at peak times to keep the network running faster, but they don’t because more people prefer a fixed price with occasional low speeds. Demand based pricing isn’t always good economics.

      1. You’ve hit the nail on the head there. Everyone will have a different viewpoint on what they are willing to pay and how much congestion reduction they want, but each road can only have one price at a given time. This is going to be a major battleground with any congestion charging.

        1. It’s not true that each road can only have one price. Airline ticket prices vary by time of year, time of day and route. And they have different ticket prices based on how early you book, whether you are a frequent flier or not, your age, business/economy class etc. Smilarly roads could give certain people discounts, exemptions, or different rates.

          1. Are you seriously suggesting charging two people a different price for driving on the same road at the same time!?

            You can’t offer one person congestion free travel on a given road for $10 another moderate congestion for $5 and another heavy congestion for $1 at the same time. We will have to determine a price for everyone that will give a certain level of congestion.

            Why would someone pay a higher price to drive at the same time on a given road that someone else when they will both experience the same congestion?

          2. I was just addressing the point about road pricing being “more burdensome on the already burdened”, and saying it doesn’t necessarily have to be because you can give them discounts. For example, you could give supergold card holders free road travel like we do on buses.

            To answer your question, others would pay a higher price than this because they are ineligible for the discount so have to pay the full fare if they want to drive on that road. Analogous to me paying a full bus fare even though I know that old people get their ride for free.

          3. One version is express lanes.

            They are somewhat rudely called ‘Lexus lanes’ in the US, with lanes set aside for paid access at a regularly adjusted price that ensures a minimum flow speed is maintained.

            They work quite well in those States that don’t regulate a price cap, and give time certainty for a demand-related price.

            The big problem is you need two express lanes in each direction, to protect against slow drivers, in addition to the free lanes. That’s a massive land requirement, which precludes that version of ‘one road: two prices’ from being applied here.

  16. The thing I am worried is AT get used to the extra money and become inefficient.

    In the future AT will ask for more and more money but under deliver and waste money for high profit subcontractors and excessive admin cost.

    AT is a monopoly bureaucrats organisation at the end. How can we audit?

    1. Was just thinking this morning that AT (pretty much all staff?) moving into the same building has or will at least improve their efficiency. Perhaps this has been their big problem all along? Perhaps LRT could be delivered quicker than we think now….especially as part of the corridor goes past their new building.

  17. Fascinating discussion. Road pricing needs to be high enough to change behaviour; otherwise, there is high administration cost for the revenue that it raises, and there is little benefit to the bus-based public transport infrastructure. A fuel tax is far more efficient in this regard. To change behaviour, however, there may need to be some consideration/reform around employment and the company car culture. Many employers pay for the parking, fuel and financing cost of their employee’s vehicles. NZ is pretty relaxed about the amount of personal use employees (& owner-operators) enjoy from these vehicles – just witness all the brand new utes driving around that never actually see a rough road Monday to Friday. My point is, for road pricing to effective, some consideration may need to be given as to whether road tolls can be considered a tax-deductible expense when the vehicle is just getting the person from their home to place of work each day.

  18. 1) “It’s easy for a scheme to inadvertently result in perverse outcomes (like encouraging vehicles that previously used the motorway to now use local streets to avoid a charge)” –

    The cordons need to be complete and appropriately located. If necessary local residents of a tolled street can receive a discount.

    2) “It’s hard, in a practical sense, to vary the price that people pay to travel by time and location (at least with current technology)”

    Agreed, far simpler to get on with it and introduce congestion tolling gantries. Full road pricing can wait. Even with the tolling gantries one could start with a 0 toll, then 25 cents and increase it by 25 cents every three months so people get used to it & you can monitor the changes in demand until the necessary toll levels are reached to manage the demand

    3) It’s easy for a scheme to hurt lower income households with fewer travel choices

    Central government should fund (even using some of the congestion toll revenue) “true public transport” a complete coverage network with 30min headways that runs 24/7. It would be a time varying mix of on-demand (origin/destination to/from PT network), fixed routes & core routes & where possible synchronized transfer timings. This means that there is always an alternative available. Local government would fund increased service levels above this.

    The alternative is to only charge some lanes the congestion toll (high occupancy/tolled lanes HOT lanes)

  19. Very arguably AT and Auckland Council have to address road pricing and they have to do it now given the targets that they have imposed on themselves.

    Auckland Transport’s Sustainability Framework of 2017 indicates (in Figure 7) that the target is to reduce millions of litres of fuel used from the current level (1662) to 1400 per year by 2020. (I note that the current usage has increased by 7.7% since 2009, a time during which AT has made the most significant improvements to public transport and cycling).

    To date AT has failed miserably to make progress and without any major projects imminent (eg CRL) it will take some other major initiative to even approach the target. A 16% reduction from current levels is needed so let’s not bother to even discuss electric vehicles, it won’t cut it. 16% is in the order of a carless day a week.

    I note that the Low Carbon Auckland Annual Update 2017 shows that the city is well behind the required carbon reduction target set by 2020.

    When even Westpac bank starts to comment on climate change then its probably indicative that there is a major problem. If Auckland is going to contribute to the solution then that’s likely to come from curtailing fuel usage given that this is 40% of carbon emissions.

    I am in favour of an immediate increase in AT parking prices everywhere so that everyone contributes to the solution. I believe that city parkers should pay proportionately more given that they have so many alternative ways to enter the city; and they are probably the least affected by the fuel levy given that most are likely to travel from the inner suburbs. A parking price increase will produce revenue to invest in transport options and it is also likely to encourage other ways of travelling. (I note that it costs more to park a motor bike in Sydney than it does to park a car in Auckland).

    Let’s start to address congestion and climate change now as incremental changes will be easier for many to adjust to. Forget talking about why we can’t do it, but rather focu on how we can.

  20. Maybe AT’s expenditure needs to be constructed from the base upwards.

    Why was a lazy $28 million more spent on road maintenance in 2017 than 2016? Has the rate of deterioration of our roads increased by that much? (I have submitted an OIA request – who knows what will tumble out the bottom?)

    When almost everyone has acknowledged that we can’t build our way out of congestion we spent a huge $66 million extra on roads capital expenditure last year.

    There’s $94 million extra for public transport with just a pen motion (and most likely a motion by every AT executive member). This amount is almost two thirds of the Auckland levy without really trying hard.

    Add in another $30 odd million by cancelling the gasometer folly and now things are starting to really cook.

    And how much revenue from parking increases? Why are these expensive resources free on Sundays when public transport isn’t?

    Maybe sell one of the under performing car parks – and we are spoiled for choice in that respect.

    If there is a will to build PT infrastructure there is a way.

    I am not feeling much confidence in the Chairman of AT; the man who chaired the Middlemore debacle. Auckland deserves a public transport system that is fit for purpose and that is much, much more than a collection of congested roads.

  21. Thank you:
    Heidi says:
    April 9, 2018 at 8:55 am
    +1 City parking levy, axle-load based truck RUCs that actually pay for the damage they cause, and some general taxation, as the health, welfare and environment budgets will be less strained.
    Reply
    Lewis says:
    April 9, 2018 at 10:15 am
    Parking garages in the city centre should require a HOP card to pay, which is just one step closer to shifting some trips to PT.

    I like your suggestions. Roads and Streets are for personal mobility/goods movement not parking. Streets need to be reclaimed for moving people. Where on street parking can be accommodated then charges should be imposed to the extent that 85% of the spaces are available at any time. If there are no available spaces the charges are to low. The charges should be increased for the longer the park is used to encourage the parker to move on.

    So true Mr Plod, transfer of public space to private use :
    Mr Plod says:
    April 9, 2018 at 12:48 pm
    Parking pricing exists in the suburbs within walking distance of the city centre in the form of “Residents only Parking Zones” in Parnell & Ponsonby. While I find these schemes fundamentally abhorrent in that they effectively transfer public property to private use they have had the effect of forcing those who parked all day for free in those zones to either; a)stump up and pay for their parking, b)park further out & walk much further c)switch to PT to get to the city d)a combination of b) & c). All bar a) are +ve outcomes in terms of reducing SOV congestion and go in some way towards mollifying my abhorrence of the scheme’s fundamentals so maybe we should extend further, into the streets surrounding Newmarket, say.
    Reply

    Heidi says:
    April 9, 2018 at 5:45 pm
    Soon to happen in Grey Lynn, probably, if the recent submission process has the expected outcome. I’m interested in whether AT will monitor the parking and especially the Hide and Ride in the adjacent suburbs this time. It would be useful data to have.

  22. MFD says:
    April 9, 2018 at 7:18 pm

    Quote from an Auckland Council document:
    .

    Let’s take a look at just one trucking operation; the proposed expansion of Brookby Quarry.

    “Brookby quarry is the most recent quarry in Auckland to propose a major expansion, and as a result it is also the quarry on which Auckland Transport has the most information. The rural local roads surrounding Brookby quarry are not designed to a standard to carry high proportions quarry truck loadings. The degrading effects on these roads are significant and are projected to halve their 25 year design life before needing to be renewed again.
    It costs $750,00013 per km to renew a local road across its 25 year life where a local road is not being subjected to a high proportion of quarry truck loadings. The road will last its intended 25 year life cycle.
    By comparison, Auckland Transport’s Southern Road Corridor Manager has projected that the renewal costs (attached) for the roads surrounding Brookby quarry will increase significantly to $2,250,000 per km over 25 years. This is approximately $37.5 million of additional renewal costs if we include the 20km of road (within a 10km radius) surrounding Brookby quarry that are used heavily by quarry truck
    traffic.

    This situation raised it’s head at Clevedon a few years ago and has not gone away. It appears if you pay the RUC you can drive what you like where you like. The whole Mill Road project seemed to be designed on behalf of the Road Transport lobby with little regard for local input.
    PS does anyone have any information what route the Mill Road motorway will take through Papakura?

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