Oregon moves forward to expand its RUC programme

Oregon is the pioneer of road user charging (RUC) (called road usage charging in the USA) in the United States. From 2001 through to 2015 it was at the leading edge of developing RUC as an alternative to fuel taxes for light vehicles, but some may say momentum was somewhat lost since then. In 2020 Utah and then Virginia became the next US states to introduce RUC, followed by Hawai’i in 2025. Until recently, it looked like Oregon had stalled, but no more.

History

Oregon established the Road User Fee Task Force (RUFTF) in 2001 to explore alternatives to fuel tax.  The RUFTF still exists to advise legislators on progressing the state's RUC programme, and its current and a little of its historic work is available here.

Oregon Department of Transportation (ODOT) research led to the first Oregon pilot, the Road User Fee Pilot Program, which ran in 2006–2007. The pilot focused on charging light vehicles more fairly for road use. It tested purpose-built, GPS-enabled on-board units and a “pay at the pump” model. Vehicles exchanged mileage data with equipment at petrol stations, allowing road-use charges to be calculated and state fuel tax to be deducted automatically.  It also included a time-of-use/congestion charge option, by allowing some participants to select paying a lower per mile fee off-peak and driving outside Portland metro region, but with a higher per mile fee for driving within Portland during peak periods. 

The congestion pricing element went nowhere, as it indicated mixed objectives, but was still early and useful research into how people might respond to such price signals.  

The report is here. The pilot was informative as it tested bespoke GPS enabled vehicle technology and the pay at the pump model, and was found wanting. A key issue being the cost of retrofitting gas stations to receive data from vehicles about mileage, and to discount gas tax from fuel bills. More importantly, a "pay at the pump" model was seen as useless for EVs, and wouldn't provide an answer. So Oregon embarked on a different approach.

A second pilot, the Road Usage Charge Pilot Program, ran in 2012–2013. It tested an “open system” with multiple mileage-reporting methods and private-sector providers, laying the groundwork for OReGO’s launch in July 2015. That report is published here. (disclaimer, I provide a small piece of advice on that report),

The result of that program was that legislation was enacted to implement the existing OReGO program (Senate Bill 810 - (2013)) - a voluntary operational RUC program for owners of EVs, PHEVs and other highly fuel efficient light vehicles. It has been amended over time, but today it works as follows.

OReGO

Eligible vehicles are passenger vehicles with a gross vehicle weight rating of 10,000 lb or less (about 4.5 tonnes) that are fully electric, plug-in hybrid (PHEV), or have a combined fuel economy rating of at least 40 miles per US gallon (mpg). 

OReGO offers a choice of such vehicle owners between paying RUC at a rate of US$0.02 per mile (to be billed monthly) or a higher registration fee every two years.

Participants whose vehicles use gasoline receive fuel-tax credits against their RUC liability, which is calculated on a per-mile gallon basis, based on the vehicle's official fuel efficiency rating.

Vehicles owners who do not join OReGO are currently subject to the following registration fees for a two-year period:

- EVs: US$316

- PHEVs: US$224

- High efficiency vehicles: US$136

Those that do join OReGO only pay US$126 for two years in registration fees, plus RUC. Clearly, while RUC may be attractive to some EV owners, it has little appeal to owners of high efficiency vehicles who face a saving of US$10 over two years in exchange for US$0.02 for every mile driven over that time.  After 500 miles of driving, the saving is lost. For EVs it is 9,500 miles over two years before the saving is lost. Unlike Utah, Virginia and Hawai’i, Oregon does not cap RUC payments to the fixed fee.

OReGO offers three mileage-reporting options:

- Odometer image capture: Owners periodically submit an odometer photograph through an app or online portal. All reported miles are charged.

- Plug-in device: A GPS-enabled device connects to the vehicle’s data port and automatically excludes out-of-state and off-public road mileage.

- Native vehicle telematics: Telematics built into the vehicle at manufacture is used, if available, to measure and transmit mileage data.

Miles driven outside Oregon or off public roads are legally exempt. GPS-enabled options exclude eligible mileage automatically; other users have to submit declarations as to the extent of off-road mileage, when and why, to obtain a refund.

Geotoll and NextPassMiles (Cintra) are the current suppliers of systems and accounts for the Oregon system.

Low takeup of RUC

Originally OReGO was capped at a maximum of 5,000 participants, but that cap was lifted in 2017. Regardless, the number of vehicles enrolled in OReGO has been much lower, with around 1,000 vehicles enrolled at present. This compared with over 140,000 EVs being registered in Oregon, and a total of over 350,000 vehicles eligible to be enrolled in OReGO.

The reasons for this are mixed. Clearly the difference between RUC and the savings on registration are not significant for many users, especially with the simplicity of choosing a fixed fees and forgetting about it.  Another factor has been the complexity of joining OReGO when a vehicle is first registered. Typically owners register the vehicle upfront, paying the higher fee, then would have to choose to join OReGO after two years by their own initiative. Few have.

Next steps

House Bill 3991, enacted in 2025, introduces a phased requirement for eligible owners to choose between RUC and a higher fixed registration fee:

- 1 July 2027: Existing EV owners must make an explicit choice at their next registration renewal: US$340 for two years, or RUC of US$0.023 per mile plus a US$126 two-year registration fee.

- 1 January 2028: Owners of new EVs must choose between the higher fixed registration fee and RUC when first registering their vehicle.

- 1 July 2028: Owners of new and existing PHEVs and other vehicles rated at least 40 mpg, including qualifying conventional hybrids, must choose between the higher fixed registration fee and RUC of US$0.023 per mile. The two-year fixed fees will be US$284 for PHEVs and US$196 for other high-efficiency vehicles.

RUC itself remains optional, making a choice becomes mandatory. Owners must choose at each two-year registration renewal.

Oregon is therefore moving from a low-profile opt-in programme to a mandatory-choice model. Many owners are expected to retain the fixed fee, but the more explicit choice is expected to increase RUC uptake.

The effect of this should be a much higher take-up of OReGO, as it becomes easier to sign up participants, and the economics of shifting to RUC are attractive to a higher proportion of vehicle owners. Some reports indicate that it is mandating all such vehicles to move to RUC, which while strictly true, this is only because the higher fixed fee is being called part of the RUC program.

It will NOT be mandatory to pay per mile, just mandatory to be part of the program.  

For Oregon this is all a great step forward, but after July 2028 it will beg further questions. If RUC does not increase in popularity will it become mandatory for some vehicles (by distance), or will the higher registration fee be increased even more to incentivise a greater shift to RUC?  

I won't be too bullish, because it has taken some years to get to at least this point for Oregon.

NSW Parliament publishes report into forthcoming road user charge for electric vehicles

New South Wales (NSW) looks set to be the next jurisdiction to implement a distance-based road user charge (RUC) on electric and plug-in hybrid light vehicles, from 1 July 2027.  From that date, EV owners will be subject to a charge of A$0.03095/km (US$0.0347/mile) and PHEVs A$0.02476 per km (US$0.0278/mile). It won't be the first in Australia to do so, as the state of Victoria implemented RUC on EVs and PHEVs in 2021, but this was cancelled in 2023.

The Parliament of NSW has now published a report into the forthcoming RUC.

Background

In Australia, RUC is a complex topic. For years the Commonwealth (Federal) Government studied and even piloted distance/weight based RUC for heavy vehicles, largely because multiple reports indicated that there would be economic productivity benefits from introducing it, alongside a wide range of associated funding and charging policy measures.  In the meantime, heavy vehicles pay registration fees to the States and Territories, at unified rates, and when paying fuel excise duty on diesel, they can claim a 100% refund for diesel not used on public roads and a partial refund of the remainder (with the part that is retained called the "fuel based road user charge"). Since 2024, heavy vehicle RUC has largely been off the political agenda in Australia. 

Then came electric vehicles (EVs), in sufficient numbers that it started to be a concern for future fuel excise duty revenues. Fuel duty is a Commonwealth tax (the States and Territories are not constitutionally permitted to levy such a tax), but is not hypothecated. States and Territories started being interested in whether they could charge a RUC for light EVs, so Victoria did so in 2021, only for a court case to go as far as the High Court of Australia, which struck it out as unconstitutional in 2023.  That court case was supported (but not led) by the Commonwealth Government. I wrote about the decision (known as Vanderstock) at the time, as I agree with the dissenting opinions of the court.  It was quite the stretch of interpretation to treat the Victorian RUC as an "excise tax" that influences the supply of electric vehicles (and therefore only within the Constitutional scope of the Commonwealth Government), but the decision stands.  

However, parallel to Victoria, the NSW Government passed the Electric Vehicles (Revenue Arrangements) Act 2021, with nearly identical language to the legislation used in Victoria.

That Act means that from 1 July 2027, EVs in NSW will be subject to a distance based RUC.

The obvious conflict is that the Vanderstock decision essentially indicated that RUC should be implemented nationally by the Commonwealth Government, not by the states. but since the decision there has been relatively little said at the Commonwealth level about RUC. 

A series of statements have been made by a few Ministers ranging from how important it is to charge EVs for road use eventually, to concern that legislation to enable this might not get passed by the Senate. 

While there has been some work behind the scenes undertaken by officials, no decisions have yet been made. Meanwhile, sales of EVs in Australia (as in many countries) are at a record high. In the year to August 2026. 18.5% of new light vehicle sales in Australia have been EVs, with it being over 26% in the month of August alone. 

NSW's legislation has not been amended or repealed (although the election in 2023 saw a change in State Government from the Liberal/National Coalition to Labor). 

Public Accountability and Works Committee

Earlier this year, the NSW Legislative Council delegated to its Public Accountability and Works Committee a review into the operation of the Act, and in particular:

(a) whether the policy objectives of the Act remain valid, and

(b) whether the terms of the Act remain appropriate for securing those objectives. 

It undertook its inquiry and has now published its report and recommendations.  Most of the ten recommendations should not be a particular problem to implement. Two of them are not good ideas, but not impossible to implement.

The NSW Government needs to respond to the report by January 2027, which gives essentially no time to amend the legislation, especially since on 13 March 2027, there is a state election. 

Report details

I’ve read more than a few reports from elected committees about various forms of road user charging and road pricing over the years, and I’m glad to say this is one of the better ones. By and large, most of the conclusions drawn are at least practical, and have some rational public policy basis for them, although a handful of them are not. 

The report is overall positive and supportive of the implementation of RUC for EVs in NSW, notwithstanding some concerns.  

Issues considered in the report include:

• Implications of the Vanderstock High Court of Australia decision on the legislation, including possible amendments to distinguish the NSW proposal from the Victorian policy
• Effects on EV sales
• Impacts of distance based RUC on different geographical communities and vehicle operators including rideshare, delivery drivers and dealerships
• Impacts on plug-in hybrid drivers
• Merits of pure distance based RUC vs including weight, fuel efficiency and congestion
• Hypothecation of net revenues
• National RUC for EVs vs. states going first
• Administration of a RUC

I won't summarise the whole 88 page report here, but it is worth a read (PDF). 

The concerns expressed are understandable and not unreasonable. It is worth noting that the Committee was chaired by a Green MLC (Member of Legislative Council), with the deputy chair from the Liberal Party.  Besides them, there were three Labor, one National and one independent (Mark Latham) on the Committee. Only Latham made a dissenting statement, and that was to support weight based vehicle registration for EVs as an alternative.

A key recommendation was to proceed, regardless of progress at the federal level, which I believe is sound, albeit risky.

At the very least, it is clear that States and Territories could wait for a national RUC system and still be waiting one, two, three or even five years from now, mainly because the political will to proceed is tepid at best. That may be proved wrong in the coming months, but it is more likely than not that NSW pushing on with RUC will catalyse action from the Commonwealth Government which is more rapid than simply waiting for something that shows few signs of progressing fast.

I have summarised the recommendations below with comments in italics.

Recommendations

Recommendation 1

That the NSW Government ensure that any future road user charge for electric vehicles is designed and operationalised in a way that does not dampen or impede the uptake of electric vehicles in New South Wales.

Understandable, and easy to address. The basis for this was evidence that RUC when introduced in Victoria and applied to EVs in New Zealand, had no apparent impact on sales. Evidence in New Zealand is blurred by the removal of a major subsidy scheme that saw levies on some new cars used to subsidise the sales price of low emission ones.  That brought forward EV sales, and meant that when RUC was applied to EVs in mid 2024, there was no effect on sales. There remains scant evidence that charging a few cents per kilometre for road use deters a purchase of an EV compared to a ICE vehicle that is already charged the same or more through fuel tax.

Key to complying with this recommendation is perhaps two elements:

• Ensuring administration and compliance for RUC for EVs is simple with minimal friction for owners. It should be easy to buy, have distance reported and be compliant, without prospective EV owners fearing not being able to understand or being fined inadvertently for getting it wrong.  There are plenty of models for doing this  - see New Zealand, Hawai'i and Oregon.
• Setting a rate for RUC, for now, that is cheaper than fuel excise.  A rate commensurate to around half of the average paid by a light ICE vehicle may be appropriate, not least because it would around the same for a battery-electric hybrid vehicle.  The proposed A$0.0395/km seems like it would do that. 

Recommendation 2

That the NSW Government, in consultation with industry stakeholders, monitor the implementation of any future road user charge for electric vehicles in New South Wales with a view to:

• assessing any impact on electric vehicle uptake, and

• promptly identifying other unintended consequences that would undermine the strategic transition to electric and low emissions vehicles.

Agree. There is considerable merit in undertaking impact monitoring, perhaps for the first two years, of RUC on sales and any unintended consequences on users.  Related to this is having flexibility to make regulatory changes at short notice to address any of these, and to take lessons from other jurisdictions about what to avoid (e.g. avoid over-complicating the passage of liability of RUC on vehicle sale or vehicle scrappage).

Recommendation 3

That the NSW Government consider an electric vehicle road user charge exemption for registered dealers of new 'in scope' low and zero emissions vehicles, to be applied up to a prescribed number of kilometres travelled on demonstrator models, and that the threshold be determined in consultation with industry stakeholders.

Disagree.  The objective of this appears linked to Recommendation 1, but this is not a good idea. The best time to educate vehicle owners about RUC is when they purchase a vehicle new.  This appears to be a call for a subsidy for new EVs, when similar exemptions don't exist for fuel duty or even tolls.  It is likely to mean "demonstrator models" get used more by proprietors and staff of dealerships, and then when sold it is a transfer from taxpayers to buyers of those vehicles. 

No other jurisdiction does this (noting Victoria had such a provision). In New Zealand, dealerships buy a block of RUC distance in advance and it is effectively included in the sales price. There is no great burden in having newly registered vehicles including a prepaid block of RUC kilometres, which is essentially like fuelling the vehicle. By contrast, in Oregon the initial OReGO program did not make provision for dealerships to offer RUC to vehicle owners, so they needed to be followed up around a year later to get enrolled with RUC or pay a higher annual registration fee. This is now being amended.

Recommendation 4

That the NSW Government consider hypothecating the future revenue collected under the Electric Vehicles (Revenue Arrangements) Act 2021 towards road maintenance and infrastructure.

Agree. This will help differentiate the RUC from the Victorian programme, but also allow for charges to be more closely linked to what is spent on the network, treating roads as a network utility. This could be done notionally, matching the net revenue collected to a specific allocation of funds for roads maintenance, or more formally (which would progressively grow in scale as RUC expands).  Treasuries hate hypothecation because they want maximum flexibility over the use of tax revenue, but if NSW's RUC is to be treated not as a tax, but as a user fee, it should have a relationship to what is spent on the network.  Furthermore, it is more likely to obtain public acceptability, if it is not treated as just another new source of revenue.  I'll note that the now virtually stalled Heavy Vehicle Road Reform programme includes hypothecation for a future national heavy vehicle RUC.

Recommendation 5

That the NSW Government investigate fairer distance-based options for electric vehicle road users in rural, regional and outer suburban communities and light commercial vehicle operators without creating loopholes or adding to the administrative burden or complexity for drivers.

Agree, pending clarification of the problem.  The report assumes that people living in rural, regional and outer suburban communities drive more distance in aggregate on average, than those in inner city communities. There is no evidence provided to support this. I'll note that in the United States, RUC America undertook a study comparing the impacts of introducing distance-based RUC to replace fuel excise for people in urban vs. rural locations and it was published in 2022. It concluded that in many cases people in rural areas did NOT drive greater distances, because they drove less frequently than residents in urban areas. Similar research in NSW would be informative and useful.

Some of the commentary in the report around delivery and gig worker drivers seems to ignore that such drivers face these fees now with ICE vehicles, paying fuel duty for driving more.  Research might indicate that delivery drivers pay more in fuel duty per kilometre driven than the average, because of the amount of starting and stopping compared to private vehicle trips. It seems particularly questionable to want to cap what is charged for such vehicles, when EVs are likely to deliver considerable savings in energy costs already.

Notwithstanding this, there is merit in enabling the registration and certification of third-party service providers to collect RUC using telematics systems either as equipment already installed in vehicles or third-party devices, to measure distance by location. This would enable exemption of distance travelled off public roads and out of state, and for measurement to be automated.  This could provide options for rural drivers and drivers located in border communities to avoid paying for travel in adjacent States and Territories. Note that Vermont has agreed to implement RUC for EVs, but requiring such an option be implemented two years later.

Recommendation 6

That the NSW Government amend the Electric Vehicles (Revenue Arrangements) Act 2021 to reframe the road user charge to have the character of a licence fee or fee for service, rather than a tax or excise.

Agree, noting that the timing to do this seems challenging at best. It should be a user fee for the use of public roads in New South Wales, and it could include a means to grant refunds for distance off of public roads or in other states, if evidence is given of proof of such travel. This could only be done after the event, and have an administrative cost to it.

Recommendation 7

That the NSW Government amend the Electric Vehicles (Revenue Arrangements) Act 2021, or use future regulations or any other appropriate mechanism, to introduce a differentiated distance-based regime in which the per kilometre rate takes into account:

• a vehicle's size and weight

• differences in battery performance and life for battery electric vehicles

• differences in emissions performance among low-emissions hybrid vehicles.

Disagree. This appears to be based on a misperception as to wear and tear on road surfaces generated by variations in weight among light vehicles. This is not supported by research commissioned by the National Transport Commission or seen overseas. Beyond the impacts of weather, there is very little impact of vehicle weight on road maintenance below the level of heavy vehicles (GVM >4.5 tonnes).  Note New Zealand did use to charge light vehicles at one tonne intervals, with the rates varying by a tenth of a cent per kilometre. One tonne increments were scrapped for light vehicles some years ago to simplify administration.

The proposal to charge differently according to battery performance and life are highly problematic not least because such data is not collected in the motor vehicle register. It would be difficult to measure this and unclear the basis for varying charges, particularly as performance and battery life varies over time.  The proposal to take into account emissions performance among hybrid vehicles (which in this case would be plug-in hybrids) also has problems around getting a reliable source of data to classify vehicles, and to incorporate it into the motor vehicle register.  It is common to charge vehicles differently by Euro class, in heavy vehicle RUC systems in Europe, but that is for vehicles almost all of which are powered by diesel.

The relative impacts and merits of such proposals seem likely to be not worth the cost and complexity to implement.

Recommendation 8

That, with respect to the administrative arrangements to operationalise any future road user charge, the NSW Government commit to:

• keeping it as simple as possible for drivers to minimise the administrative burden

• fully integrating the charge within the existing administrative scheme for vehicle stamp duty, registration fees and licensing.

Agree. There should be a base level simple product for vehicle owners to interact with, such as a prepaid licence (as in New Zealand), an annual fee based on an estimate confirmed at registration time, or a regular invoice based on an average or submitted distance. It makes perfect sense to integrated with registration fees, but there needs to be a rapid commitment to the base level product that provides the most flexibility to users, while enabling alternatives either immediately or within a couple of years.

Recommendation 9

That the NSW Government continue to work with the Federal and state governments on road user charging policy, with a view to working towards a national road user charging system.

Agree, it should go without saying that a national system or nationally co-ordinated system is preferable to a patchwork of policies that risk incoherence.

Recommendation 10

That, absent a national road user charging framework and regime, the NSW Government proceed to implement the electric vehicle road user charge established by the Electric Vehicles (Revenue Arrangements) Act 2021 subject to the amendments outlined in Recommendations 1 to 8 above.

Agree.

Next steps

The NSW Government is expected to provide the Government Response to this report by 11 January 2027.  This should give a clear indication of what happens next.

In the meantime, it is not impossible to expect that there might be an announcement from the Federal government in Canberra about RUC policy nationally (although few would bet on it). The Mid-Year Economic and Fiscal Outlook is due to be issued in December 2026, which would cut it fine indeed, but be timely to signal what might happen nationally.  However, it is also quite likely that nothing will be signalled, given other government priorities.

Belgium to introduce nationwide light-vehicle vignette in 2027

Following on from the cancellation of the Brussels Smartmove programme - which would have implemented distance based congestion pricing, the three Belgian regions have agreed to establish a nationwide vignette (time-based charge) for light vehicles from 1 July 2027.  

It will cover travel on all motorways, highways and many major roads in all of Belgium, and cover all vehicles with a registered weight of < 3.5 tonnes excluding motorcycles. This includes all EVs, PHEVs and BEHVs, as well as diesel and petrol powered vehicles.

What is a vignette?

Vignettes are an unknown concept outside Europe, and are essentially access passes bought in advance of travel, for use of a road network within a jurisdiction.  Vignettes exist for light vehicles in the following countries in Europe:

• Switzerland
• Austria
• Czechia
• Slovakia
• Slovenia
• Hungary
• Romania
• Bulgaria
• Moldova

Of course you wouldn't know this from the EU's published map of light vehicle charging below which characteristically ignores non-EU Member States, such as Switzerland and Moldova.

Map of light vehicle road charging in the EU

Vignettes are legally what is called a “road user charge” under EU law. They are distinct from both tolls and distance-based charges (which are called tolls under EU law). Confusing? Yes. 

Tolls apply to specific facilities and are charged on actual use. Distance based road user charges are effectively metering for actual use travelled. Vignettes are time-based road user charges, which are sold on the basis of prepaying for access to a network for a set number of days.

Thinking of vignettes as prepaid access charges to a network of roads is perhaps the best explanation. It doesn't matter if you actually use the roads, you buy a "pass" to use them for a set period. It's a more flexible version of the annual vehicle registration or licence fee seen in virtually all jurisdictions.

What will they cost?

Belgium will be selling vignettes for 1 day, 10 days, 1 month, 2 months or 1 year.  This gives users flexibility to pay for a single transit of the country (common for driving from say France to the Netherlands) or for a longer visit. All light vehicles using the road network will be charged, including both Belgian registered and visiting foreign registered vehicles.

The rates for vignettes vary based on duration and the emissions class of the vehicle. A one year vignette will vary from €90 for EVs through to €125 for older higher emitting vehicles.  The charges for shorter periods for an average car (rated EURO IV) show there’s clearly much higher charges for very short periods.

1 day - €9 (EV €8.10)

10 days - €12

1 month - €19

2 months - €30

1 year - €100

Let’s be clear this is not a replacement for fuel tax. Vehicle owners in Flanders and Wallonia will see reform of registration fees, meaning the new vignette will partly be offset by such reductions. It is not clear if the same will happen in Brussels.

A major issue will be whether the European Commission approves of it. When Germany attempted to introduce a light vehicle vignette, it also proposed significant reductions in annual vehicle registration fees to largely offset the charge for German registered vehicle owners.  The European Union Court of Justice ruled that the proposal was discriminatory, because by reducing the fees for German vehicle owners, the burden of the vignette lay mostly on foreign registered vehicles.

It is expected to raise over €450m per annum gross, but around €300m of that would be offset by reduction in other fees. The net revenue will be used for road maintenance and upgrades.

How will it work?

Light vehicle owners will be expected to purchase vignettes through an online portal, linking their vehicle number plate to the vignette. Vignettes will be enforced by the use of automatic number plate recognition (ANPR) cameras on key strategic locations, with failure to pay enforced by a fine. The cameras will check if a vignette has been paid for a specific vehicle.

What about fuel tax?

No EU Member State has moved to replace fuel tax. Only Iceland has replaced part of its fuel tax with a distance-based road user charge, but it is not an EU Member State. A key issue in Europe is that the EU Energy Directive requires member states to maintain tax on petroleum at a minimum level of €0.359 per litre (US$1.59 per gallon). 

Any road user charge to replace fuel tax could currently only reduce it down to that level. Malta has its petrol tax at exactly the lowest limit, so it could not reduce it. The Netherlands has the highest petrol tax at  €0.845/l (US$3.74 per gallon), so could conceivably reduce fuel duty by a significant amount in exchange for a distance based road user charge. 

Could vignettes have wider application?

Clearly "yes" if it can be implemented in a way that avoid being overthrown by the European Court of Justice. So Belgium will be a test case.  It is entirely possible that if Belgium succeeds, other European countries will introduce light vehicle vignettes, especially the ones with few toll roads (think the Netherlands, Denmark, Sweden), and Germany may try again.  It might be seen as a step on the path towards distance-based charges for light vehicles. Why? Because Austria does this right now.

In 2004, Austria's Federal highway company - ASFINAG - introduced a distance-based toll, using DSRC technology, for heavy vehicles using its highway network, but also introduced a vignette for light vehicles. These two charges essentially fully fund ASFINAG (alongside other revenue it generates from facilities such as roadside EV charging stations), and balances charging by weight/distance and emissions for heavy vehicles, and pre-paid duration of travel for light vehicles. 

There may be a case in future for a nationwide distance based charge for all vehicles, on all roads, not just the ASFINAG network, but pressure for that appears modest at present, and would likely only come as a response to declining fuel tax revenue.

A vignette, as a prepaid pass for travel, is a particularly elegant solution for visiting vehicles, as it is easy to understand, sell and enforce. That compares to paying by distance, which would require some independent measurement of distance at the point of entry and exit. Without access to data from OEM telematics, mandating third-party devices with suitable applications, or requiring imaging of odometers at borders (which are almost entirely open), distance based charges by country for light vehicles become challenging to implement for visitors.

While Europe looks at this challenge, the implications for federal jurisdictions are considerable. It is entirely possible to see the United States being a patchwork of vignette systems for visitors and local vehicles, with locals paying at registration and visitors buying passes to travel in each others' states, maybe as an alternative to distance based fees.  

What's wrong about vignettes?

Vignettes are blunt, and they don't reflect actual road use. A one-day pass may be for a short distance of travel once, or it might be for a very long trip. A year pass covers both regular use a few times a month and daily.  So its reflection of use is poor.  Those who pay the most are actually those using it the least, as charges are relatively high for short period passes (visitors), but lowest for locals who pay annually, but regularly use the network throughout the year.  This may be politically popular (and questionable in terms of EU law*), but is not a "usage" based charge.

All of the European distance-based truck toll/ heavy vehicle road user charging systems replaced vignettes for heavy vehicles. The effect of this change was to generate much more revenue, because actual usage grew compared to estimated average usage based on time-based passes.

So I don't think vignettes are an ideal option to replace fuel tax, as a way of charging electric vehicles for road use, but they are not the worst option to do so. They might provide an alternative for just those vehicles, as a step towards distance based charging.

*I was part of the Booz & Co team that wrote this report for the European Commission ("Study on Impacts of Application of the Vignette Systems to Private Vehicles") in 2012. This is a comprehensive review of vignette systems for light vehicles in EU Member States at the time, including issues around rate setting and enforcement practices.

Brussels quietly abandons revolutionary congestion pricing programme

 Background

Belgium is a federation of three highly autonomous regions. Since 2016 it has operated Viapass, a nationwide heavy-vehicle distance-, weight- and emissions-based road user charge for trucks over 3.5 tonnes. Viapass is run jointly by the three regions rather than the federal government; pricing and network coverage vary by region (all roads in Brussels; selected roads in Flanders and Wallonia). It replaced Belgium’s participation in the Eurovignette system, which charged trucks of 12 tonnes and over for time-based access to main highways across participating countries. Viapass is a great success. Six companies offer accounts and the necessary equipment for trucks using the charged network. It is mandatory for trucks registered in Belgium and all those visiting it.  Brussels charges trucks more for using local roads compared to the motorways.  The rate structure is here. 

For light vehicles, distance-based charging has seen little progress. Fuel duty sits at €0.60 per litre. Registration fees remain high. Brussels attempted to change this with SmartMove, a pilot project designed to cut high annual vehicle registration fees and replace them with a distance-based charge that also varied by time of day and location within the Brussels Capital Region.

The aim was to shift taxation from ownership to use, cut congestion and emissions, and encourage modal shift.

I wrote back in 2020 about it and again in 2021. This was a system, piloted in 2021 designed to replace the high annual vehicle registration fees for light vehicles in Brussels, with a distance based charge, which would vary by time of day.  

I said it was interesting for three reasons:

1. It is the latest attempt to introduce distance-based RUC for light-vehicles in Europe, replacing an existing tax. (Since then Iceland has done so, for all vehicles, but on a vehicle class basis distance fee, not one that varies by location and time of day)

2. It seeks to combine RUC with a form of congestion charging, by varying distance by time of day and location. The time of day factor is intended to charge higher rates for peak time travel, and the location factor being that only distance travelled within the Brussels Capital-Region would be subject to a fee.

3. Smartmove intends to pioneer using smartphones as a means of identifying and measuring vehicle trips. This has not been successful elsewhere to date, primarily because of the difficulties in ensuring that the phone is always linked to the vehicle, and the vehicle always has a smartphone operating to measure and report trip data. 

The project had several key objectives. Reduction of congestion, reduction of emissions, encouraging modal shift and shift motor vehicle taxation from ownership to usage.

Deloitte led key elements: designing and building the smartphone app prototypes for large-scale testing; developing gamification and “nudging” tools to encourage shifts to public transport; and creating the public campaign and website.  Unfortunately, all of this has disappeared (although the Wayback Machine is always our friend).

Part of the former SmartMove website

Proposed Brussels area for distance charging

Registration fees in Brussels start at €79–€6,358 for initial registration, with annual road tax ranging from €107 to around €4,000. Reducing these fixed costs while introducing a usage charge would have made car ownership more accessible, giving flexibility to own a vehicle while raising the cost of peak-time driving. 

Modelling by Transport and Mobility Leuven (reports in French and Dutch) indicated that full implementation could cut total kilometres driven in Brussels by 12% on an average working day, 18% in the evening peak, and delays by 30%. Even after cutting registration fees, the scheme was projected to generate an additional €250 million a year, partly from visiting vehicles.

Some of the benefits modelled for SmartMove were:

• €54.1m per annum in economic benefits for all of Belgium
• €11.4m per annum in health benefits (mainly from more active travel and the subsequent health benefits)
• €10.6m per annum in reduced accident costs
• €9.8m per annum in reduced emission costs

The project noted that on an average weekday, around half of all light vehicles driven in Brussels are not registered in Brussels. Pricing those vehicles alongside local ones would be essential to reducing congestion.  Notable, the average car trip length in Brussels is only 6km. 

Why was SmartMove potentially revolutionary?

SmartMove would have been pioneering. Unlike Singapore’s evolving GNSS-based ERP 2.0, it relied on ubiquitous consumer smartphones rather than dedicated on-board units or OEM telematics. With the ability to price by distance, location, time of day and vehicle type (lower rates for EVs and micro-cars, higher for larger ICE vehicles and SUVs), it could have differentiated arterial routes from local streets and applied fine-grained peak pricing. The app was also intended as a broader Mobility-as-a-Service platform offering journey planning, pricing and ticketing for alternatives to driving.

SmartMove could have been the most highly evolved road pricing system anywhere. 

By using mobile phones, it was a significant shift from concepts involving bespoke equipment being installed in vehicles, or accessing OEM telematics, to a consumer product that is almost ubiquitous – smartphones. Technology that hardly anyone in either the Intelligent Transport System or transport planning community anticipated.

SmartMove website sales pitch

What happened?

The test phase began in August 2020 with 100 Brussels Transport Authority employees, expanding in September to 2,000 citizens. The pilot costed the Brussels government €24.8 million and it ran through the pandemic, being extended to June 2022. €51 million EU grant toward a total estimated implementation cost of €68 million), ran through the pandemic and was extended to June 2022.

The app showed participants what they would have paid under the new system versus existing fees and awarded points (with real value) for driving less at peak times or switching modes. Because no real money changed hands, the trial mainly tested technical feasibility and user appeal. Preparation for full rollout included purchasing ANPR cameras in 2022 to match vehicles to accounts and fine those without an active app. Forgetting a phone, a dead battery or app failure would have risked a fine—an obvious practical weakness.

Opposition and cancellation

Perhaps the biggest critics, and understandably so, were residents (and politicians) from neighbouring Belgian states. Belgium is a federation, with Brussels being one of the three constituent states. If Brussels implemented SmartMove it would have granted Brussels residents a significant cut in vehicle registration fees in exchange for paying the charge.  However, owners of vehicles registered in Wallonia or Flanders that commute into Brussels would face the charge, without any such reduction. After all, the other states would not get any revenue from it, so it would effectively be a charge on non-residents driving into Brussels. Legally, Brussels was required to implement it on a co-operative approach with the other states, and it was likely that had it proceeded it would face a legal challenge, constitutionally, due to their opposition. 

However, it was opposition in Brussels that saw the programme fail, and the main reason was that it was seen as being anti-car, anti-motorist and was (wrongly) interpreted as being alongside a whole package of other measures (called GoodMove) which were designed to make driving slower (for safety), more difficult (by reallocating road space to other modes and reducing on street parking), and less attractive. 

The changes to the Brussels Government, following the June 2024 election and over 600 days of coalition negotiations, were the death knell of the project. The coalition government is now led by the Reformist movement - the centre right liberal French-speaking party, in coalition with five others. The length of those negotiations indicated how fraught they were, and anti-car measures have been cancelled as a result.

On top of making driving slower and more difficult, there was opposition to the cost, and with the possibly of legal challenges from the other states, it was easy to cancel. Furthermore, actual support for the proposal was muted. A key reason for this was the emphasis on implement road pricing to reduce emissions and encourage changes in behaviour, rather than seeing it as a measure to reform the taxation of motor vehicles in a way that would reduce congestion.

Motorists are more likely to support congestion pricing if other charges are cut, and if it can be proven to reduce congestion.  They are less likely to do so if it is seen as a tool to "correct" them, as if they are themselves failing by how they choose to get around, and they are especially less likely to do so if it is just seen as a new tax, with little benefit (unless you stop driving). 

That’s unfortunate, because it could have been recast as a project to make driving more accessible and efficient with lower fixed fees, but better mobility at peak times. By primarily being a redesign of the tax system around motor vehicles, it could have been seen as improving fairness. Poorer people, single parents or pensioners who use cars to access employment on the urban periphery, or social services, or visit family and friends could have had lower costs of travel with lower registration fees.

What can be learned?

Leaving aside the constitutional issues, as it was bold to even think it could have been plausible to tax motorists from outside Brussels, while only compensating those within, the main mistake in Brussels was seeking to do too much in one step and to not sell it as being primarily about making motoring taxes fairer.

It is always a big deal to convince people that paying more to drive reduces congestion, but to do so without being able to convince people they would also save a lot of money from owning a car was difficult. Emission reductions are good of course, as is making public transport (especially buses) move more freely and improving the urban environment altogether, but it needs to be about the people most directly affected - the motorists. While there were some efforts made to sell congestion reduction benefits to business, these were overwhelmed by concern about the cost.

The app concept was a challenge, as it presented the risk that if you forgot your phone or it did not work, you would be fined for not paying. That should not have been the only way to interact with the system as it risked mistakes being punished.

Options of paying a flat fee for driving per day would have been easier to understand, and not hard to implement without it being punitive. The app could have been one option alongside a more blunt ANPR based scheme. 

So there was a failure in policy, driven in part by technologists wanting their solution to be all encompassing. Most of all there is a failure to communicate enough to motorists and design a policy that can be acceptable to them. Furthermore to do this alongside a whole host of other measures to make driving more difficult makes the main objective look like it is anti-car.  Despite the best efforts of some transport planners and politicians, perhaps the biggest lesson in the past few years politically is that the public don't like being told that what they do is wrong and they need to be corrected.

Other jurisdictions have proven that distance based road user charging can be implemented for private car owners and be acceptable, as long as it replaces another tax very clearly and transparently. Others have proven that congestion pricing can be implemented if it makes driving for those paying easier, more reliable and faster.

Unfortunately, the Brussels Government and the SmartMove programme can join the list of cities that nearly implemented congestion pricing, and help inform those who might actually do it.

Romania to be the next country to implement heavy vehicle road user charging

Following on from the Netherlands on 1 July, Romania will become the 15th European country to launch a distance based road user charging system (truck toll in European parlance), using GNSS technology. It becomes the 16th full country worldwide to have heavy vehicle RUC and the 20th jurisdiction globally to introduce such a system (bearing in mind I am counting the nationwide DSRC based toll systems in Austria and Slovenia in this count, as they are priced by distance across the national highway networks).

TollRo as it is branded is expected to be launched on 1 October (this is a second delay from 1 July and 1 January) and will effectively mean heavy vehicle RUC systems will apply from the Low Countries at the English Channel (Belgium/Netherlands) all the way through central and eastern Europe to the Greek border, and the borders of the former USSR (Belarus, Ukraine, Moldova).  TollRo will be the responsibility of CNAIR.

CNAIR is the National Company for Road Infrastructure Administration.

It applies to travel on all motorways (“A” roads), expressways (“DE” roads) and national roads (“DN” roads). This covers over 18,100km of roads (around 29,000 miles).

TollRo will apply to all heavy vehicles with a registered gross vehicle weight of more than 3.5 tonnes.  It will replace Romania’s vignette system for those vehicles (although the vignette will remain for light vehicles). The rates for the vignette (essentially a time based pass for those unfamiliar) are below

Category	Vehicle type	Validity	RON	US$
C	Goods vehicle 3.5 t–7.5 t	1 day	20.39	$4.00
C	Goods vehicle 3.5 t–7.5 t	7 days	81.54	$16.00
C	Goods vehicle 3.5 t–7.5 t	30 days	163.08	$32.00
C	Goods vehicle 3.5 t–7.5 t	12 months	1,630.82	$320.00
D	Goods vehicle 7.5 t–12 t	1 day	35.67	$7.00
D	Goods vehicle 7.5 t–12 t	7 days	142.70	$28.00
D	Goods vehicle 7.5 t–12 t	30 days	285.39	$56.00
D	Goods vehicle 7.5 t–12 t	12 months	2,853.93	$560.00
E	Goods vehicle ≥12 t, up to 3 axles	1 day	45.87	$9.00
E	Goods vehicle ≥12 t, up to 3 axles	7 days	183.47	$36.00
E	Goods vehicle ≥12 t, up to 3 axles	30 days	366.93	$72.00
E	Goods vehicle ≥12 t, up to 3 axles	12 months	3,669.34	$720.00
F	Goods vehicle ≥12 t, 4 or more axles	1 day	56.06	$11.00
F	Goods vehicle ≥12 t, 4 or more axles	7 days	280.30	$55.00
F	Goods vehicle ≥12 t, 4 or more axles	30 days	616.65	$121.00
F	Goods vehicle ≥12 t, 4 or more axles	12 months	6,166.52	$1,210.00

Charges will be based on:

• Distance travelled;

• Vehicle weight category;

• Road type (different rates for motorways compared to national highways); and

• Emissions class.

Vehicle owners will have two initial choices to comply with the system:

• Account with a telematics provider (typically supplying a GNSS enabled on-board unit)

• Pre-declared single trip route ticket

To enable interoperability between account managers for toll and RUC systems across Europe into Romania, it has set up an organisation called Serviciul European de Taxare Rutieră Electronică (RoSETRE). It is essentially the European Electronic Tolling System platform for Romania. This will enable existing providers in neighbouring countries to sign up to be certified to operate in Romania, so that, for example, a Hungarian registered truck using a service provider for the Hungarian HuGO system, could use that very system and the account for that system to pay Romania’s charges.  

The rates for motorways and expressways are as follows (per kilometre in Romanian Leu):

 

Vehicle Mass	Euro 6	Euro 5	Euro 4	Euro 3	Euro ≤2
3.5 t - 12 t	0.31	0.38	0.43	0.52	0.61
Over 12 t	0.42	0.49	0.56	0.69	0.81

 

Lower rates apply for “main national roads” presumably reflecting the lower level of service

 

Vehicle Mass	Euro 6	Euro 5	Euro 4	Euro 3	Euro ≤2
3.5 t - 12 t	0.25	0.30	0.35	0.43	0.49
Over 12 t	0.32	0.39	0.45	0.56	0.62

 

For US readers, the rates in US$ per mile are below

 

Motorways and expressways — approximate charges in US$ per mile

Vehicle Mass	Euro 6	Euro 5	Euro 4	Euro 3	Euro ≤2
3.5 t - 12 t	$0.111	$0.136	$0.154	$0.186	$0.218
Over 12 t	$0.150	$0.175	$0.200	$0.247	$0.290

 

Main national roads — approximate charges in US$ per mile

Vehicle Mass	Euro 6	Euro 5	Euro 4	Euro 3	Euro ≤2
3.5 t - 12 t	$0.089	$0.107	$0.125	$0.154	$0.175
Over 12 t	$0.114	$0.140	$0.161	$0.200	$0.222

Seven providers are apparently registered to be account managers for the Romanian system. I'll provide more details once it is up and running (and hopefully it won't be delayed for a third time)!