Auckland Council to consult on congestion pricing

Long time readers will know I have followed (and worked) on Auckland congestion pricing studies for some time.  Most recently two big steps have been taken to advance the idea, noting it is labelled "Time of Use" road charging in New Zealand (just to add to the colourful vernacular in road pricing):

• New Zealand passed a law authorising the introduction of Time of Use road charging, enabling local authorities to develop proposals to work with central government;
• Auckland Transport commissioned study on more detailed options for Time of Use road charging

Incredibly, the Land Transport Management (Time of Use Charging) Amendment Bill was passed unanimously in the New Zealand Parliament, by all six parties. 

Auckland Council has voted to proceed with consultation on three time-of-use road pricing (congestion pricing) options for Auckland City later this year. 

There was extensive debate about whether to include in consultation an option of the public being able to reject road pricing altogether, but the amendment to do this did not proceed, so the consultation is not the end of the process.  Curiously, long standing City Councillor, Maurice Williamson (who was a Minister of Transport in the 1990s and a long advocate of road pricing) wanted the option of the public to say "no" because he said he had a record of pushing through unpopular policies before.  However, the consultation will simply focus on what the public thinks of the three options.  The process is depicted below. As you can say, once feedback is received on the options, Council will vote on which, if any, of the three options, it will support through to Scheme Initiation.

Scheme Initiation requires a Scheme Board to be set up jointly with central government, which will then commission the more detailed work.  That Board will finalise the detailed proposal, obtain public input and require approval of Council and then the Transport Minister to be proceed. The current schedule assumes approval will be finalised in mid 2028, with implementation no earlier than 2030.  That means there is plenty of work yet to do.

The options are:

• City centre cordon

• City centre and fringe cordon

• Core motorways with cordon (either 1A or 1C)

The common elements to all proposals are:

• AM peak charges in one direction, PM peak charges in the other direction
• Shoulder charges so that rates rise and decline either side of the peak
• No interpeak charges

City centre cordon

The city centre cordon concept sees an AM peak charge of NZ$3-NZ$4 and PM charge of NZ$2-$3. It would charge around 3.1% of all morning peak car trips, but 23% of trips would see some saving in time. It would reduce car trips by 0.8% and speeds increased by 1.0-2.4% region wide on average (although clearly it would be much higher closer to the cordon and lower in outer suburbs), with a reduction in region wide congestion of 2-4%.  The estimate is that those paying will save four minutes on average. 

It has the following key advantages:

• Most passenger (unlike freight) trips are modally substitutable either by PT or active modes

• Exclusion of the hospital (and Port)

• Through trips are excluded (which are much less easily substitutable by PT).

However, it has very limited impact. Beyond approach routes into the city centre, it is unlikely that there would be much effect noticed on congestion. While there may be some easing of congestion through the Central Motorway Junction, it is unclear how sustainable that would be as it may attract more through traffic through the centre. It would also encourage some degree of “park and ride” or “park and walk” activity near its fringe, making car parking in Newmarket and Ponsonby significantly more valuable simple because of where the cordon is drawn.

Even those who pay may not notice much improvement, because so much congestion is on motorway and arterial routes far from the downtown cordon, so the benefits of paying to drive in the peaks might be perceived as poor value. The benefits at the city end would be noticeable, but if drivers remain on largely slow roads such as Onewa Road or the Northwestern Motorway for long periods, it may suffer from perceptions of whether it was worth it.

Maybe it is good as a first step, to demonstrate it has some impact, but it is hardly worth being the major scheme.

City centre and fringe cordon

The city centre and fringe cordon has more merit as it captures more trips, including Newmarket, Newtown, Ponsonby and Parnell (there is ambiguity about this). This is likely to have more notable impacts on trips on all arterials and motorways approaching the city.  It might be somewhat trivial, but as the “middle” option, I am betting this is the one most likely to be advanced. It moves the “park and ride” issue further out, more into suburban areas (so there will be a need for more residents’ parking or on-road parking restrictions in neighbouring suburbs).  

It is notable that this proposal has much higher charges in the AM peak ($5-$6), with $2-$3 in the PM peak, so it is unclear how much of the higher benefits is a function of price, not scheme design.  It sees 5.1% of AM peak car traffic charged, with a 1.4% reduction in region wide car traffic. The effect is a 1.0-4.1% increase in region wide traffic speeds (again it seems the averaging will see little impact beyond the Isthmus approach corridors). This represents a 3-6% reduction in congestion across the region.  Those paying are estimated to save five minutes on average.

A big issue is inclusion of the hospital, which either can be ignored (as peak only charges do not affect many users), or some discount or subsidy can be offered to vulnerable users with appointments. That would add some costs and require careful design (I recall designing and modelling such an option for Manchester). 

Overall, it would demonstrate noticeable benefits for the inner isthmus and even roads approaching the Northern Motorway from the lower North Shore but could only be seen as a first step.  The inner motorways would benefit with the reduction in trips using them, but it seems likely this would not be sustainable, as the Central Motorway Junction would gain an uplift in level of service compared to the Western Ring Road, which may attract a transfer of vehicles to take advantage of the (uncharged) time saving. 

Core motorways with cordon

Core motorways with cordon is easily the most superior option from the perspective of congestion reduction. Noting it could be included with either of the cordon options above. 

The charge would indicatively cover the Northern Motorway (SH1) from the Harbour Bridge south along the Southern Motorway to the Mt Wellington Interchange, and along the Northwestern Motorway (SH16) to the Waterview Interchange, alongside a cordon.  The proposal is for peak direction charging on the motorways, although this could be bi-directional.  $5 is proposed for the AM peak to access the motorway and the cordon. 

The effect is to target 6.9% of car trips in Auckland, reducing car trips by 2% (it is notable that this isn’t a significant increase on the city centre and fringe cordon). It increases regionwide speeds by 4-6%, reducing congestion by 13%. There would be a 9-12 minute time saving on motorways, with a 5 minute saving crossing the cordon (it is not clear if the savings accumulate for those driving on the motorway to cross the cordon). This is significant, but indicates that this option crosses the tipping point where traffic conditions break down, and relieves traffic volumes enough to allow a much more efficient flow of traffic. While 93% of car trips across the region in the peak are not charged, 31% are expected to benefit. Unfortunately, because the option includes no options to prevent rat-running off the motorways, it also predicts 12% would experience minor delays due to diversion.

That point is worth noting only because the option has been developed rather simplistically, when it is technically possible to capture rat running with appropriate sets of number plate camera (ANPR) to deter drivers from leaving the motorway to avoid the charge then using local roads to go past a motorway offramp point. Detailed traffic modelling should be used to ensure this can be addressed.

However, it is clear this option is the one with the most merit in transport policy terms. It has the attraction of being able to be tailored more finely for the conditions on each of the three motorways. It shouldn’t be the same fee on each route in each direction, and at a later stage there are merits in extending charge times on corridors that have enduring congestion – notably the Southern Motorway between Greenlane and Mt Wellington. 

Are there better options?

This will be a source of some debate.  

Double cordon?

One considered was a double cordon on the Isthmus, which is a bad idea.  The proposal below was sourced from the Options Assessment and Policy Framework report (PDF)

Besides the downtown, it added an inner cordon, which would still exempt through trips on the motorway, but charge anyone entering either of the cordons in peak times (so those within the outer cordon would still be charged to enter the inner one). Although it has some positive impacts, this is offset by the blunt impact of having a cordon cutting through residential areas, separating homes from schools, parks, shops and other local amenities for no other reason that the convenience of a traffic engineer drawing the line. It is quite unlike the city centre, which is bounded by the Central Motorway Junction, Grafton Gully and the harbour. 

Cordons are effective and avoid serious distortions if there are natural geographic or large scale artificial boundaries which a cordon can be placed onto. Stockholm has much of this, London not so much, but the very low proportion of car trips taken in inner London saw the distortions being very minor indeed.  Cordons are for the sake of simplicity and ease of understanding. However, cordons through suburban residential areas have considerable scope to create distortions. Gothenburg experienced this in the northern suburb of Backa, where the cordon literally splits the suburb in two.  This meant that local residents, notably elderly ones, driving from their homes to local amenities faced the same fee as those driving into the central city. Technology has been implemented so that only people driving from outside Gothenburg are charged when passing the cordon that runs through Backa (the Backa exemption). The scale of Auckland, which is much larger than Gothenburg, means that a cordon beyond the city centre would mean residents literally charged for taking cars one block, or charged to take children to one school but not another nearby.  

I am pleased this option has been rejected, and I fear the city centre and fringe cordon might present some similar issues, but this is about as far as any cordon should go in Auckland

Motorway hotspots

Another option that was rejected was pricing targeted motorway hotspots. 

The concept was to price the most congested parts of the network, effectively creating a pilot scheme that could demonstrate the benefits of time-of-use pricing before a wider rollout. While it was never intended as the end-state for Auckland, it could have delivered valuable evidence and public familiarity with road pricing. Unfortunately, I think the option was short-changed by the way it was designed and assessed.

First, no effort was made to mitigate rat-running around charging points. ANPR systems can identify vehicles that leave a motorway immediately before a charging point and rejoin shortly afterwards. Charges can then be applied only to those passing both camera locations, while legitimate exiting traffic remains exempt. The Backa exemption in Gothenburg demonstrates that this is both feasible and established practice. Ruling out motorway hotspot charging partly because of diversion impacts, without incorporating available mitigation measures, risks understating its potential benefits.

Second, modelling behavioural responses remains inherently crude. This is not a criticism of the modellers; it reflects the difficulty of estimating how many people might:

• travel four rather than five days a week;
• shift travel by an hour or two; or
• combine trips more efficiently.

Motorway hotspot charging is likely to rely more on changes in travel timing and frequency than on mode shift, although expanding alternative transport options remains important. The most obvious gap is the absence of the Northwestern Busway, although the corridor already benefits from bus lanes and could support significantly enhanced services.

Finally, the assessment framework appears to favour options with the largest region-wide impacts. That is understandable, but smaller-scale interventions will inevitably produce more localised benefits. Singapore's Electronic Road Pricing system evolved through precisely this approach, targeting specific congestion points and expanding over time. Rather than attempting to solve congestion everywhere simultaneously, it focused on maintaining traffic flow where congestion was most severe.

Too often in the report materials Singapore is depicted more as the Area Licensing Scheme from 1975 (which was a small cordon with manual enforcement of paper based permits) rather than the Electronic Road Pricing system which evolved from 1995 onwards.

Singapore ERP charging points

Auckland could trial a small number of motorway segments with simple, targeted pricing designed to improve traffic flow on those corridors. Such an approach would not transform the entire network, but it might deliver visible results and prove easier to gain public acceptance for than a larger and more comprehensive scheme.

Distance based option

20 years ago, the UK Department for Transport was funding local authorities to develop congestion pricing schemes that would leap ahead of the level of sophistication of the London Congestion Charge (which wouldn't be hard). One way it was going to do this was to fund piloting an option for motorists to pay by distance, time of day and location, rather than just time of day and location, by allowing those who want to, to use in-vehicle technology to measure distance at peak times only, on specific roads identified beyond specific boundaries.

In the New Zealand context this could mean that subscribers to any of the three existing electronic road user charging (eRUC) providers could be charged directly, not based on entering a cordon or a motorway as a flat fee, but by kilometre and have that be at a much lower rate until the fee accumulated to the full charge. The ability to do this has not been explored at all to date, but once the Land Transport (Revenue) Amendment Bill passes, there may be more scope for new entrants into the eRUC market to offer an option to customers to not just pay RUC automatically, but to pay on a different basis to the blunt single charge approach anticipated.

I don't expect either time or budget permitted exploring this further, but it is definitely something that should be considered not just for commercial vehicle users, but any private motorists who wish to do so. e.g. it may be much cheaper to pay for a few kms of driving on a charged motorway in the AM peak than a single flat charge, and also more directly discourage rat running. 

Next steps

As public discussion expands, resistance is inevitable.

The Council debate revealed a vocal minority opposed to road pricing in principle, alongside a group of sceptics who remain open to persuasion. Those concerns are understandable. Road pricing is a new charge, and net revenues are expected to be reinvested in the transport system. Questions about whether that spending represents value for money, and whether those paying directly benefit, are legitimate and deserve answers.

What has been largely absent from the debate, however, is a clear discussion about the cost of congestion itself on a personal level, rather than the multi-billion dollar aggregate which most people cannot get their heads around.

No major city has successfully eliminated congestion by building its way out of the problem, whether through road expansion or investment in alternative modes alone. Managing demand is an essential part of the solution.

For Aucklanders, congestion means waking earlier, arriving home later, spending less time with family and leisure activities, and consuming more fuel or electricity. For businesses, it means fewer deliveries, fewer service calls, fewer meetings and lower productivity. Congestion makes the city less efficient, less prosperous and less liveable.

None of the options under consideration will eliminate congestion. They can, however, make the network function more efficiently, improve travel time reliability, encourage better use of alternative modes, and spread demand more evenly across the day.

That alone would be a worthwhile outcome.

Most importantly, momentum must not be lost. Progress to date has been slow, perhaps reflecting the complexity of joint decision-making between central and local government. If the proposals pass the next stage, careful public communication will be critical. The detailed design process must address genuine concerns while avoiding the misunderstandings that so often dominate debates about road pricing.

I look forward to the consultation beginning in November 2026.

What to do?

Clearly those who have strong views on congestion pricing in Auckland should participate in the consultation, but they should all read the documentation provided along with earlier reports (links above).  The likelihood that there will be a lot of public opposition is fairly reasonable and understandable, but what would be most productive is to get some indication of the options people dislike and like the most, and why. Besides helping to select the best option, it would also help to refine options and indicate concerns that perhaps haven't been explored sufficiently. There is also merit in understanding whether opponents will be affected directly or not, as well as those who will benefit.  What is almost invisible is that bus users at peak times are likely to benefit noticeably with less congestion, as long as buses are not overcrowded as well.

I'm a firm believer that pricing can be designed in a way that has significantly positive outcomes with negative outcomes that can be mitigated, with major city shaping effects. It is particularly important for those who see road pricing as a great tool to punish driving and treat motorists as "car fascists" (as a politician once quipped a few years ago) to end that sort of talk. Nothing will kill off road pricing more than it being dominated by people who want to treat driving as a malignant activity, and by default treat people's choices around where they live, work and play as needing "correction". That's not what the intention of the legislation is, and it is notable that a centre-right government in New Zealand has advanced this policy with the primary objective of easing gridlock, not raising money and not punishing driving.  If you can't convince the people that will have to pay that they can be better off from this, it isn't going to proceed, and if you seek to design it so they are not, then it definitely won't.

New Zealand's Parliament passes legislation to enable congestion pricing - unanimously (but the details will come later)

In a possibly unprecedented step, the New Zealand Parliament has voted - unanimously - to pass legislation allowing for "Time of Use road pricing" to be enabled, based on proposals from local road controlling authorities in partnership with the NZ Transport Agency (NZTA) (the central government transport funding and regulatory agency, which is also the State Highway manager).  

The Bill was introduced into Parliament by the three-party centre-right coalition government, and at the end was backed by the three leftwing Opposition parties as well.  I believe this is the first time anywhere in the world that congestion pricing has received unanimous political support at a national level.

According to the press release from Transport Minister, the Hon. Chris Bishop:

Sitting in traffic wastes time, costs money, and drags down productivity,” 

“Travel times in our major cities are up to 30 per cent longer than in comparable Australian cities, with Auckland congestion alone estimated to cost up to $2.6 billion by next year.

“Time-of-use charging is a common-sense tool that encourages people to travel at off-peak times or by other modes. It’s about keeping our cities moving - whether you’re a parent on the school run, a tradie heading to a job, or a truckie delivering exports to port.

“Time of use charging has been talked about in New Zealand for years and now we’re getting on with it. I am really pleased that the legislation to allow the establishment of time-of-use charging schemes passed Parliament unanimously. After years of discussion, it is great to see that all of Parliament is up for reducing congestion and improving productivity.

Ironically, there is next to no political appetite for such a policy in Australia in the near future, in any State or Territory.

Of course the legislation itself does not actually implement road pricing, but it does provide a framework for time of use pricing proposals to be generated, as a local-central government partnership, for approval by the Minister.  The details as to what it will mean, in practice, will only come once the Minister of Transport has approved a road pricing scheme, following a proposal submitted by local and central government authorities.

Objective

Unlike some congestion charging schemes implemented elsewhere, the primary purpose of any proposals in New Zealand must be to relieve congestion, not raise revenue (although it is acknowledged that revenue will be generated). It is not designed to reduce emissions, but it is acknowledged that this is likely to be a benefit from it.  It is fundamentally not intended to punish driving, but to reduce driving on specific roads at specific times so that traffic can flow more freely.  It more closely resembles the objectives of the Singapore Electronic Road Pricing policy, than say New York or London.

This is not surprising, as New Zealand is one of the most car-oriented countries in the world.  Auckland, which has 1.7 million people and has made the greatest progress in developing options for road pricing, may be the first to implement it. However, Auckland has highly dispersed travel patterns with around 80% of trips in Auckland undertaken by car (either as driver or passengers), with 18% by walking or cycling (and the remainder by public transport).  

Timing

The legislation does not come into force for a year after Royal assent, and subsequent to that, the Minister can receive proposals for approval, amendment or refusal. Given the next New Zealand General Election must happen before the end of 2026, it seems unlikely that the Minister will receive a proposal in advance of that. 

What's next?

Auckland Transport and subsequent to that Auckland Council are expected to make decisions on what sort of Time of Use road pricing scheme it wants to implement, with NZTA, and a proposal will need to be developed for acceptance by NZTA and then submitted to the Minister.  Before that happens, there will need to be public consultation on the proposal, and at that point the pressure will be highest on local politicians as to whether they want to advance any proposal for implementation.

Other cities can submit their own proposals too. Wellington, Christchurch, Queenstown and Tauranga have all been mooted in recent years for congestion pricing on some scale, so it will be interesting to see which, if any, look to advance work on concepts for pricing in the coming year. Although much smaller cities and towns than Auckland, all have some congestion at peak times which can be severe for their size, and could benefit from road pricing. 

Of course nothing is guaranteed.

The UK has had legislation enabling congestion charging by local authorities for around 24 years, and only Durham and Nottingham (the latter being a workplace parking levy) have implemented schemes under that legislation (London happened under specific legislation setting up Transport for London).  New Zealand will not be quite the same, as the UK has generally enabling legislation (not requiring central government support), whereas New Zealand will see proposals go to the Minister for approval and will need to be a central-local government partnership. However, I would wager that it is more likely New Zealand will have a congestion pricing system operating sooner than any other UK cities will implement it.

New Zealand, appears on the face of it, to have a rather unique set of political willingness to enable congestion pricing, which is unseen elsewhere, but the reality of what any proposal will actually mean for motorists will come later.

Let's hope whatever proposals advance, that they can bring enough political and public acceptability to enable them to be implemented.

The Bill (which won't be law until Royal Assent) is available here.

(meanwhile it would be nice if the NZ Ministry of Transport updated its website)

Responding to Simon Wilson of the NZ Herald on Auckland congestion pricing

First a warning. I don't use this blog as a place for debate or polemics, but on this occasion, I have decided to respond to an article which is quite damning, as an example of the sort of debate one endures around the topic of road pricing. This article is by no means the worst I've ever seen, but it is full of assertions with little to no evidence, mistakes and bold claims that appear to be more motivated by a desire to undermine the policy itself (and perhaps this is because it is from a government he himself does not support), than to critically review the merits of it.

The NZ Herald is Auckland’s (New Zealand) newspaper of record. Simon Wilson (no relation) is the NZ Herald’s senior writer on transport issues. Given the NZ Government’s recent announcement of its intention to advance congestion pricing (called time of use pricing), he has written a column on the topic, which is arguably a polemic of weak argument against it. Note it is behind a paywall. I am a subscriber, but it is not worth you paying to read his article though. 

It is possible to critique time of use pricing in Auckland on some grounds, such as whether it could be expanded at reasonable cost sufficiently to significantly address congestion, or whether net revenues should be redistributed through tax cuts rather than spending on infrastructure, or if it is better to introduce road pricing more generally, so driving outside congested time and locations is cheaper.  It is possible to argue that there should be more and better public transport to accompany road pricing, or that it could cause government to delay or cancel some new road projects, but none of that is apparent.  

I’ve spent over 20 years working on road pricing policy around the world and I have seen arguments against road pricing from a range of perspectives. Some on the right see it as an additional tax that intends to limit motorists’ freedom and increases the power of the state against them or is used to invade their privacy through "tracking". Some on the left see it as unfair that a scarce resource (road space) is allocated on the basis of price rather than queuing.  Wilson is on the left.

Simon Wilson has written many columns in the past about the importance of tackling climate change, of getting more people out of their cars and into public transport or active modes. He is a fervent believer in behaviour change in urban transport policy. Now he is making himself perhaps the highest profile campaigner against the one policy that could achieve more of what he claims to want than any other – more efficient road pricing.

He titles his article “Sorry Simeon Brown, congestion charges are not the key to freeing up the roads”. 

He’s wrong. I doubt Wilson can identify a city in the world that has freed up its roads without road pricing, he certainly doesn’t name any. Short of Pyongyang (or Covid lockdowns), I don’t know of any major city in the world without road pricing that has significantly reduced congestion, although certainly some that have it do still have severe congestion (notably London). Singapore and Gothenburg certainly have much less congestion than before either city had congestion pricing, Stockholm has much lower congestion approaching its central city and along its main bypass route (although there remains congestion elsewhere in its network). Milan still has bad congestion, although it is better with pricing.  Wilson does not indicate which cities on a scale of Auckland have freed up their roads without either road pricing or depopulation

So what else did he have to say?

He repeatedly asserts that time-of-use pricing, congestion charging etc is a “tax”, which presumably he is saying for pejorative impact to appeal to readers on the right of politics (new taxes are "bad" from a traditional rightwing perspective).  Whether or not it is a tax would be a legislative matter. I’m not sure if he thinks water meters are a “tax” or electricity meters, but applying a price, that varies by time-of-day, and is periodically reviewed as to user demand (as in Singapore), is not very much like a tax. In Sweden, congestion pricing is called the “congestion tax” for legal reasons, in Singapore the term “Electronic Road Pricing” is used to describe simply a fee for using the roads. Does he see bus fares as a tax? Does he see the existing toll roads in NZ as a tax? This is hardly a major point, but it sets the tone for this article, which is a not particularly coherent piece, sometimes opposing road pricing and in one place saying "it has a role". 

Although he admits that congestion pricing works, he then makes several claims that do not stand up to scrutiny, namely:

• They can “do a lot of harm”;

• They are “not the key to reducing congestion”.

He also says they are not popular, which is hardly a surprise, as reports from The Congestion Question (the last major study into the topic from 2016-2020) indicated that public acceptability is the greatest challenge to implementing congestion pricing. Wilson’s column is of course helping to add to this challenge. I don't think you should complain about something being unpopular by contributing to its unpopularity sans the merits.

What about "do a lot of harm”? He doesn’t elaborate, and in fact provides zero evidence of a "lot of harm" anywhere, so why say it? Why scaremonger?

He then acknowledges that for commercial traffic, congestion is a cost, whether for freight delivery or simply providing services that require getting between sites.  However, he then describes Stockholm, London and Singapore as all being cordon schemes, which isn’t quite accurate. Although he cites The Congestion Question report, he clearly did not read the report on international experience (PDF) (disclaimer: I wrote that with colleagues of mine).

Let's be clear, Singapore is predominantly a corridor scheme (with two small cordons), with most charging points on major roads and arterial routes approaching the downtown. Stockholm is a cordon (PDF), but also now has a corridor charge for the Essingeleden motorway that passes through the city.  London is strictly an area charge (it charges circulation within the cordon as well as crossing it).  

Wilson mentions this because he prefers cordons it seems but sees corridor charging (which the Mayor of Auckland did propose last year) as being flawed because they are easy to avoid by rat-running on local roads. That’s true, if you don’t put in place measures to price that rat-running (e.g. by pricing exiting and then re-entering a road to avoid a priced point). 

This appears to be a very weak attempt to condemn road pricing schemes that aren't cordons, but the Government's policy is not that there should not be cordons, or that there should be any specific type of congestion pricing scheme at all.  

Of course, there has been no decision at all about what proposal to introduce in Auckland, but the Congestion Question did recommend a downtown cordon supplemented by corridor charges, on the most congested routes on the Isthmus and towards the North Shore first. More work has to be done on what the first scheme would look like. So it seems rather premature to be antagonistic to the very concept as a whole at this stage.

The Congestion Question indicative downtown cordon

His next point is to appear to be critical of the timeframe, as he claims the first scheme would not be in place until 2028. This seems pessimistic. Sure the legislation and approvals will not be finished until 2025, but it is entirely plausible for a scheme to be operational within two years of that. He indicates that the timing of elections (local in 2025, national in 2026) is driving this, but it’s unclear that this could be accelerated to be significantly faster. He says it should be operational when the City Rail Link opens, which I agree, but it seems unlikely that even if approved today, that a scheme could be operational in 18 months. Yet surely if that is the best time, the second best time is as soon as possible afterwards?

Then Wilson goes back to how unpopular it would be. He claims it is a “regressive tax”, yet I don’t recall him calling the introduction of the Auckland Regional Fuel Tax that, even though there is a study that explicitly concluded that (PDF). The fuel tax applied 12.5c/l on petrol and diesel sold in Auckland, and of course meant everyone driving paid it, except those able to afford an EV or hybrid vehicle. Wilson did support the regional fuel tax when it was introduced, and he said “It does hurt the poor disproportionately …. But it also targets almost everyone who's clogging up the roads”.

That’s nonsense. It targeted nobody. He also said “one day we’ll have better ways to manage demand” saying essentially road pricing would be that but “we don't have the technology in place to do that yet and it's controversial”. The regional fuel tax was not introduced as a demand management tool, but moreover the technology to do road pricing exists now.

Now the government is now advancing it, and he opposes it, not because of the unavailability of technology. Of course the regional fuel tax is now history, but that measure improving the cost of living for most Aucklanders is unnoticed, because this is a polemic.

He gives no evidence for road pricing being particularly regressive, although as a concept it is no more “regressive” than pricing water, electricity or indeed public transport or food. As part of developing proposals for Ministerial approval, an impact analysis of the proposed “time of use” pricing scheme will need to be undertaken.  Perhaps Wilson could focus on what that analysis should look like, rather than dismissing the whole idea of pricing as regressive. Now the Gothenburg congestion tax IS regressive, there is evidence of this (PDF), but it was a scheme set up to raise revenue and is far larger in scope than the scheme that would have been needed to relieve congestion.  The NZ Government is proposing time of use pricing specifically to improve network productivity, not to raise revenue, but Wilson ignores that, as it doesn't fit his polemic. Of course congestion is regressive, as the richest don't commute at peak times or can buy homes close to work.

He claims “It’s not the key to solving congestion. And one of the most common arguments for it is economic gibberish”. This is rather embarrassing. If you don’t understand an economic argument then the best way of understanding it is not to call it gibberish, in fact it displays astonishing ignorance. His understanding of the value of time and the economic impacts of congestion is poor indeed.

He claims “These charges will be a cost of doing business that companies will pass on to their customers. For the general public, they will raise the cost of living”. Will they? Having claimed correctly that less congestion will make all sorts of businesses more productive, whether it be for freight deliveries or services such as the building trades, they will be able to undertake more jobs for the same cost (wasting less time and fuel). Pretty much all benefit/cost analysis indicates businesses save much more than congestion pricing costs, so it would not be passed onto customers. Of course congestion costs are passed on.

It's his next claim that is the most embarrassing.

Alan McDonald from the Employers and Manufacturers Association (EMA) has said much the same. “Recent traffic monitoring data has found that Aucklanders are losing 22 million hours per year out of their lives while they sit in traffic,” he declared. “That equates to a $1.3 billion annual hit to GPD.”

Gibberish. You can’t link private travel to productivity because very few people drive to work on company time. However long your commute takes, it’s your own time you’re wasting.

Everyone resents it, and fair enough. But the economic value – the “annual hit to the GDP” – is zero.

Wilson claims that the economic cost of congestion to private individuals is zero. He claims this doesn’t impact on GDP.  Let’s set aside the obvious social cost. Congestion means commuters leave home earlier and get home later than they would otherwise. That’s less time with family, less personal time, less time to cook, to exercise, to sleep even. Wilson understands what externalities are, I think, so he could at least acknowledge that.  However, what he misses out is what congestion does to opportunities for individuals.

You see the available job pool for most people is directly related to the duration of commute from wherever they live to wherever jobs are located. Most people are happy to commute for up to half an hour, and many in a larger city for up to an hour, although those with children to look after are more challenged. Beyond an hour those able to spare that amount to time to travel to and from work are much more limited in number. In short, congestion reduces the opportunities people have to increase their incomes with better employment, and it also reduces the labour pool available to employers to improve their productivity. I’m always a little sceptical of the methodologies used to “cost” congestion, but to dismiss traffic congestion as not imposing costs on GDP as it applies to private individuals is ignorant. There is literature to back this up.

Wilson then determines that the answer isn’t road pricing, but more rapid transit. Yet he doesn’t seem to be able to explain why cities like Paris, Amsterdam, Tokyo, New York, Sydney or San Francisco all have chronic congestion WITH lots of rapid transit? The Northern Busway is a great piece of infrastructure, but it hasn’t fixed congestion on the Northern Motorway, although it has absorbed a lot of demand growth. Buses do carry a lot of people over the Auckland Harbour Bridge, but the idea that this is a substitute for road pricing is simply absurd. He may as well say that you don’t need parking fees if there are free buses.  It’s completely false to equate the impacts of the Congestion Question, which was a network wide reduction in congestion, from the effects of the Busway on one corridor.  He claims rapid transit reduces emissions. This only happens if it enables modal shift from driving cars, which of course congestion pricing promotes as well (bearing in mind transport emission in NZ are capped with the Emissions Trading Scheme anyway). 

The article explains all of the benefits from a lot of public transport, without even really noting that the costs of all of this infrastructure he wants need to be paid for, and one way of doing it would be through congestion pricing. That doesn’t mean I think that’s how the money should be spent, but surely that connection could be made? Furthermore, all of the rapid transit he touts does absolutely nothing for freight or tradies or other commercial traffic, as they can’t use it.

He then makes this remarkable failure to connect thoughts:

Our roads are appallingly congested, we are failing to reduce carbon emissions and our road safety record is among the worst in the developed world. The opportunity is for a rethink about how and why we use the roads, so we can build ourselves a more functional, friendlier city. Instead, the Government proposes a new tax.

He claims “a great many people will not be able to avoid a congestion tax”. How does he know? If it is a downtown cordon, where only 13% of employment is based and half of commuters already travel by public transport or active modes then hardly anyone will be affected. Even if it is just the Mayor’s two corridors, that wont affect most commuters either. Again, this is just nonsense. 

If Simon Wilson can’t see the link between road pricing, reducing congestion and emissions, and making a city more functional and friendly, then he is either ignorant or deliberately disingenuous. I fear he is simply a polemicist seeking a headline and he can’t give any credit to a politician he doesn’t like or support for implementing a policy that does more for what he wants than any other single measure at the lowest cost.

Opposing the very concept of time-of-use road pricing at this critical stage indicates he is not really interested in enabling all of the potential tools to reduce congestion, lower demand for emissions and encourage modal shift at all, but rather is just writing polemics for headlines. 

Wilson would be better placed to focus not on opposing the first government in NZ’s history to advance road pricing to implementation, but rather to focus on the design of the first scheme proposal for Auckland, to ensure it has a positive impact on reducing congestion, minimal impact on those with low incomes and limited choice, and to encourage creative solutions, such as those used elsewhere, to address any issues. If he wants a cordon, then talk about it. If he wants a different option, then fine. However, if he doesn’t know anything much about the topic at all, he might prefer to read a bit more, talk to people who do and not try to undermine a policy that actually has general support across the political spectrum from the Greens on the hard-left to ACT on the classically-liberal right. 

Time-of-use pricing could help Auckland look much more like what Simon Wilson wants it to, it’s just a shame he wants to get in its way, on grounds that are spurious and almost entirely baseless.

The Congestion Question evaluation of impacts

Crucial next steps for Auckland congestion pricing

 I wrote on my Rational Transport policy blog on this topic, largely because it was around transport governance issues.  The article is here.

Auckland's Mayor and Council vote overwhelmingly for congestion charging, but there are some issues

The big road pricing news in New Zealand in the past week was the Mayor of Auckland, Wayne Brown, calling for congestion charging and appearing on media declaring how critical it was for the city. This was not in terms of raising revenue, but in addressing congestion.  On Radio NZ he said Auckland could not afford another motorway, and that the charge would be avoidable by driving outside of peak times.

“I am of the view that this should be on our motorways in the central areas of Auckland, which are the most congested, and this is also where public transport works best, which gives some people an option rather than paying the charge”

He ridiculed concerns about equity around trade businesses, saying that to pay $5 to save 20 minutes was a small fraction of the price the tradespeople charge their customers in an hour. He also said that schoolchildren “don’t’ have a right to be taken to school in a BMW” and more should walk, bike or use public transport. 

The Mayor was elected in 2022 and has a three year term, but his support for the concept was only solidified when Auckland Council voted 18-2 in favour of setting up a team to oversee implementation of congestion charging.

Despite that report, Auckland is not going to get congestion pricing in two years. Legislation will take around a year to introduce and pass at best, and it will take around 18 months to procure and install a system at best. However, you have to admire the ambition.

The astonishing level of local political support for the concept is unheard of in any other city where the private car is by far the dominant transport mode.  In 2018 (according to the Census), around two-thirds of Aucklanders commuted by car (whether as driver or passenger), 11% by bus, 9% walked and 8% worked from home, 3% by train and just over 1% by bicycle. It seems likely that the proportion working from home, cycling and using public transport has increased since then. 

Let's be clear to those unfamiliar with Auckland. The Mayor is ostensibly "centre-right" and got elected opposing the "war on cars". The Council as well is fairly balanced between left and right wing members.

Unlike New York and almost all other US cities that have been investigating congestion pricing, Auckland is regarding the net revenues as secondary (although the Mayor is interested in revenue, as the incoming government has pledged to abolish the regional fuel tax of NZ$0.10 per litre that raises revenue for transport projects in the city). The primary focus is reducing congestion and encouraging behavioural change. However, it would clearly generate net revenue and would also have positive environmental benefits.

Why does this matter?

All of the cities that have introduced congestion pricing around the world so far have been quite different from Auckland, and indeed all of the predominantly car-oriented low density cities that are seen in New World cities in New Zealand, Australia and North America. Singapore, Oslo, London, Stockholm and Milan all have significant mode shares for public transport. However, Dubai and Abu Dhabi (and soon Doha) are car dependent cities, even moreso than Auckland, whereas Gothenburg in Sweden is much closer to the mode shares seen in New World cities. 

Although New York will be the first US city to introduce some form of congestion charging, it is being implemented in lower Manhattan, which is much more like central London than most US cities, and it is being introduced 24/7 (with peak charges) primarily to raise revenue. New York is not a model for other North American cities.

Auckland on the other hand, has around 87% of its employment outside the central city, it has around a 50% mode share for public transport and active modes for trips to the central city at peak times, but a much lower mode share for trips to other parts of Auckland at peak times. In short, congestion in Auckland is primarily about trips across the city, not to the downtown.  Pricing in Auckland will work only in part by encouraging modal shift, but will in a large part be about encouraging a small proportion of trips to shift time of day or frequency of driving. 

Furthermore, unlike many other developed cities, Auckland has had over 20 years of billions of dollars in continuous major capital spending on its transport networks.  During that time, the road network has been significantly upgraded, with additional lanes on motorways and a ring route around the west bypassing the congested central motorway junction. The commuter rail network was extended to the downtown, electrified with new trains, adding new lines, and is now being expanded with an inner city loop. Bus services have been expanded, with busways and new buses, routes and expanded frequencies.  In short, Auckland has seen extensive capital spending on its transport infrastructure and it has been unable to keep up with demand, and congestion has not been resolved.  

Supply of transport infrastructure does not sustainably reduce traffic congestion. 

If Auckland successfully implements congestion pricing, it will be a world leader in implementing road pricing in a city with automobile dominance.

What has been proposed?

The Mayor has specifically proposed a charge on two segments of motorway of NZ$3.50 - $5 per trip.  It would operate in the AM and PM peaks only on the North Western Motorway (SH16) between Lincoln Road and Te Atatu Road, and on the Southern Motorway (SH1) between Penrose and Greenlane. These are two of the most congested parts of Auckland’s motorway network.  The map below depicts the short section of North Western Motorway, the segment of Southern Motorway and the earlier proposed downtown cordon (which is bypassed by the motorway network which goes from south to the Auckland Harbour Bridge and from the west to the Ports of Auckland).

Auckland congestion pricing concepts.

Undoubtedly the motorway proposals would have a positive impact. While the North Western motorway at this location has no reasonable alternative route, the Southern motorway does have a wide at-grade arterial road, albeit with multiple sets of traffic signals and a much lower speed limit. Some measures would need to be taken to minimise diversion onto the parallel routes. 

It's worth noting that a major study into congestion pricing in Auckland, called The Congestion Question, was carried out from 2016-2020, and recommended that a downtown cordon be introduced, followed by corridor charges on major routes in the isthmus and beyond.  The Mayor is proposing the second stage, but that is good as the downtown cordon concept was likely to have a less dramatic impact than the proposed corridor charges.

The proposed technology would be automatic number plate recognition (ANPR) cameras.

What needs to happen?

Congestion pricing is currently illegal in New Zealand. The outgoing Labour Government had draft legislation prepared to implement it, but this will be revised with the incoming National led Government. National included congestion pricing in its transport policy, so there is little chance of the policy being rejected by the new government. Until legislation is introduced and passed, congestion pricing cannot be implemented, but in the meantime, it is possible for Auckland Council and Auckland Transport (a separate entity under the auspices of Auckland Council) to plan and prepare for road pricing. 

The motorways in Auckland are not under the control of Auckland Transport, as they are State Highways. They are Crown owned (and fully funded by) and managed by the New Zealand Transport Agency/Waka Kotahi. It seems unlikely that central government would devolve power to impose pricing on motorways it owns and manages to local government. However, it seems much more likely that a joint entity, between central and local government could be set up to manage pricing across roads in Auckland. 

What are some of the big issues?

Oversight

A key issue is how much control central government, in particular the forthcoming Minister of Transport and/or Cabinet, wish to have in approving and later amending congestion pricing schemes. At present the Minister approves tolling schemes, which are only for new roads. At present there are only three toll roads in New Zealand (one in outer Auckland). It seems unlikely that government will want to give road controlling authorities free rein to implement congestion pricing, but it would also be unwise to require changes in pricing to go through a political process. 

A middle approach would be to require Ministerial approval for a road pricing proposal (by a road controlling authority on specific roads within certain time periods) concept but grant powers to road controlling authorities to adjust pricing and business rules within set parameters, with oversight by an economic regulator (such as the Commerce Commission or a more specialised highway economic regulator).  The oversight would be to ensure prices were not set to be higher than necessary to relieve congestion, or to be unduly burdensome on different types of road users, and to monitor use of net revenues (which is another issues). Ultimately the need for political approval could be reduced, if the economic regulator has sufficient powers to protect consumers.

Governance

The other governance issue is what entity should be responsible for pricing? It could be left to the relevant road controlling authority, but for Auckland it would make sense to have a joint-governance entity for both Auckland Transport and NZTA roads, with sufficient delegated authority to manage pricing within set parameters. A joint entity would mean that there could be a single road pricing account, and that enforcement, communications and information could be unified. It would also provide a structure for managing net revenues, contracting for equipment and services.

Use of Net Revenues

The Mayor would like pricing to replace the regional fuel tax in Auckland, which raises around $150m per annum. However, this is likely to be controversial. There are clearly a range of options available such as:

• Capital funding for public transport and active transport projects

• Capital funding for road improvements

• Offsetting ratepayer funding for road maintenance and improvements (reduces rates)

• Offsetting ratepayer funding for public transport subsidies (reducing rates)

• Dividend to ratepayers, households or residents

Internationally, the most popular options have been to use the net revenues to support some mix of road and public transport projects. If that option is selected, the projects ought to be high-quality (i.e. net economic benefits) and ideally be related to the locations subject to pricing (i.e. new transport capacity). However, it is likely to be tempting to simply replace the regional fuel tax as a revenue source (as removing that tax will benefit all Auckland motorists). It may also be tempting to use it to offset ratepayer funding on transport capital projects in any case, but if done on the scale proposed by the Mayor, it seems unlikely to gain much support if revenue from specific locations is used to benefit transport users not using those corridors. If motorways are going to be priced, it seems unlikely that central government will want to pass on control of use those revenues to local government. However, if a joint pricing entity is established, it may be reasonable to get agreement across both levels of government as to the use of net revenues for several years in advance.  

Prices, products, discounts and exemptions

Rates should be set at levels that will achieve enough behavioural change to relieve traffic, they should only be applied at peak times, and have a shoulder rate either side (for say half an hour) to avoid rushes to avoid the peak.  Rates should only apply in the peak direction (which may be both ways).  Exemptions and discounts should be minimised, and focused on local buses, emergency services, drivers with mobility disabilities and motorcycles, and there is a case for higher charges for heavy trucks and coaches (due to the amount of road space they occupy). A daily caps on charges might be considered, but if pricing is implemented on the scale proposed by the Mayor it seems likely to be unnecessary.

Motorists could be billed directly through direct debit, or have prepaid accounts able to be topped up through internet banking, phone banking or manually using cash at selected retail outlets.  Visitors could be offered “daypasses” for unlimited driving of congestion priced routes, but if only operating at peak times, it seems easier to simply send an invoice to a registered vehicle owner through post/email. 

Is it a good idea?

The biggest strategic decision is whether the Mayor’s idea of pricing a couple of sections of motorway should be the first step or if the downtown cordon concept should be.  There are advantages and disadvantages of each option.

Undoubtedly the pricing of two sections of motorway would have a more direct and obvious impact to motorists and could be seen as demonstrating more clearly how pricing could work, and be implemented incrementally around Auckland. It is likely to be higher risk than implementing a downtown cordon because of that impact, but will be more effective.  Given that, it makes sense to seriously consider the Mayor’s proposal.

On the other hand, the downtown cordon would be an effective pilot. It is clear that almost all drivers into downtown Auckland have modal alternatives, and with the opening of CRL (City Rail Link) which provides an underground rail loop around downtown Auckland, that case is strengthened.  Such a cordon would improve congestion on a range of routes approaching the city centre, including three motorways, but the effects of that reduction would drop significantly a good kilometre or two away, as so much traffic in Auckland is not focused on trips to downtown. 

If it were up to me, I’d say it would be preferable to implement the Mayor’s proposal of pricing on two stretches of motorway as a first step, rather than the downtown cordon.  The downtown cordon should be implemented, but in and of itself it doesn’t demonstrate to Aucklanders the effectiveness of pricing a corridor, which is as much about shifting time of demand as it is about shifting mode. The downtown cordon should be timed to be implemented shortly after CRL opens (CRL needs to work seamlessly first). 

The North Western Motorway corridor ideally wouldn’t have pricing until the North Western Busway is built, but the existing bus lanes could provide sufficiently additional services to make pricing worth implementing there. The Southern Motorway corridor parallels a railway line, and some bus services, so that shouldn’t be a problem in terms of alternatives.

If rat running is an issue (which it may be for the Southern Motorway) then technology can be used to deter it, by identifying vehicles leaving the motorway early to avoid a charging point and returning to it after. Pricing could be set at levels to make diverting not worth the time penalty.

What do stakeholders think?

The Employers and Manufacturer’s Association (EMA) head of advocacy and strategy Allan McDonald was supportive according to RNZ saying “You come back to getting the most out of the system you can and finding different ways to help those who may be disadvantaged by the cost but there are significant benefits too”. He noted Auckland needed better public transport, but the road network needed to work better too. 

Automobile Association Auckland issues spokesperson Martin Glynn said there were benefits, but he was concerned about the impacts on low-income drivers with few alternatives. 

Public Transport Users Association chairperson Niall Robertson was concerned that there needed to be better public transport alternatives. 

What next?

First and foremost, a new Government needs to be formed, and the incoming Minister needs to make it clear the parameters within which congestion pricing will be authorised. 

Secondly, the policy and the messaging around congestion pricing needs to be clear, to address fears and concerns, and to avoid the public guessing, wrongly, about what may be implemented, why and how.  It needs to be clear it is about reducing congestion and pricing should be based on meeting performance standards. It also needs to be clear that pricing does not need public transport alternatives for all drivers, to be implemented, but that the choices drivers have range from changing time of travel, mode of travel, route of travel or to drive less frequently. 

Thirdly, legislation needs to be drafted and introduced to implement the intended policy.

Fourthly, Auckland Council, Auckland Transport and NZTA need to work together on a detailed design and implementation of a phased plan for congestion pricing in Auckland. Starting with either two corridors or a downtown cordon. 

Fifthly, NZTA and Wellington and Tauranga local authorities also need to work together to undertake more detailed studies for both cities, consistent with legislation and central government policy.

What NOT to do?

1. Don't see London as an example to copy. London is an area charge, it has a flat all day rate and has not enabled traffic to flow relatively efficiently for over 10 years because it is too blunt. London may be seen as culturally closest to Auckland, but it is vastly different. Better examples are in Singapore and Stockholm.
2. Don't make this project about raising revenue. When the focus becomes revenue raising, the design will change and it becomes a lot more difficult to get the public on-board, because you are designing a tax, rather than a traffic management and pricing scheme.
3. Don't make this about reallocating road space. While there will be localised cases where there is merit in doing this (specifically for cycling safety or bus priority at intersections), a successful congestion pricing system should enable all traffic to flow efficiently, including buses, and will improve conditions for all modes on the roads.  Some advocates for congestion pricing see it as a tool to penalise driving and to make it more difficult for motorists to drive. If this is the policy adopted, it will be rejected by the public (as it has been in many many cities), as pricing need not be a tool of penalty, but a tool to make existing networks work better. 
4. Don't play with technology yet. There would be nothing wrong in eventually linking the current eRUC telematics systems to congestion pricing so their users (almost all commercial vehicles) pay charges automatically, alongside RUC.  However, ANPR is just fine for now.
5. Don't make any announcements on details until you have decided on most of them, and have responses as to why you made certain decisions. Don't let the media and public discourse determine policy. Design a good system with defensible policies, and then present it to the media and public, so you can make clear what might be negotiable and what is not.  A litany of failures elsewhere are due to letting policy debates get out of control, raising fears and uncertainty, and consigning the concept to the "too hard" basket.

(Disclaimer: I worked on The Congestion Question project from 2016 to 2019)  

Congestion pricing doesn't require public transport to be an alternative for most trips - the Mayor of Auckland makes a common mistake

Does congestion pricing need all motorists to have a "reasonable alternative", by mode of transport?

No.

The alternatives to congestion pricing include:

• Modal choices (public transport and cycling/walking for shorter trips)
• Time of day choice (driving outside charging periods)
• Route choice (avoiding driving on priced roads if possible)
• Trip frequency choice (driving less frequency if a trip is regular)

The single biggest reason cars have become ubiquitous in cities is because they enable trips to be undertaken between origins and destinations that are not, and are likely to never be efficient to take by other modes. For trips to city centres, public transport can be an option for many, at peak times and indeed for trips between locations on public transport corridors, they obviously can be undertaken instead of driving, but for many cities, especially lower density cities like Auckland, characterised by houses on blocks of land in outer suburbs. It is not ever going to be efficient to have bus services that are always walkable to all of those suburban outlying areas.

So those that claim public transport alternatives need to exist for everyone are mistaken or actually just opposed to congestion pricing.  I hope the Mayor of Auckland is simply mistaken.

Background

I've written before about Auckland, New Zealand's, experience in investigating congestion pricing.  A major report was released just before the pandemic (see here) and I wrote about it here.

In short it was recommended that Auckland implement congestion pricing, starting with a small inner city cordon (effectively as a pilot, but consistent with Auckland Council's objectives to reduce car use in the inner city and provide more space for pedestrians, cyclists and buses) followed by corridor based charging, in some ways resembling how Singapore's excellent ERP system was rolled out. 

The pandemic stopped further progress, but in the meantime the Government of the day was re-elected, with a majority for the ruling Labour Party, and it followed up with a Parliamentary Inquiry into congestion pricing in Auckland. which recommended that congestion pricing proceed.

It's worth noting that congestion pricing is not controversial at the level of national politics, although there is debate about how to use the money, and the priority of objectives. The Green Party supports it, so do the Opposition centre-right National and free-market liberal ACT parties.  However, it would be fair to say that progress in advancing congestion pricing in Auckland has been glacial over the past year.

To enable congestion pricing, the Government needs to introduce legislation to permit it to be introduced and this has not yet occurred.  However, in the meantime there were local elections in New Zealand. Auckland's Mayor had retired, and he has been replaced by the centre-right candidate Wayne Brown, who has reportedly now said that congestion charging is a "distraction" and 

"Congestion charging could only make sense once every Aucklander has the option of catching a bus or a train that they know will show up on time, every time – and we are two years away from that, at the very least"

There are two big mistakes with this:

1. If it were decided to introduce congestion pricing, it would take at least two-three years before it could be ready in any case.  Indeed, the argument has been made that the right time to introduce it is when Auckland's underground city rail loop is completed in 2025 or so.
2. There is no reason for EVERY person to have a public transport option to substitute every possible car trip, indeed it is neither possible nor rational nor necessary.  This is because many trips will simply change time or frequency of travel, especially more discretionary trips.

What does congestion pricing do?

Fundamentally, congestion pricing is applying a time and location sensitive price to road use directly, with the intention that it shall alter behaviour of marginal users of the road network (those sensitive to price relative to the value of the trip by road at that time and location), so that they do not use congested roads at specific times, reducing congestion to more economically efficient levels.

In most cases congestion pricing has not been mostly about people shifting modes of travel, although modal shift is very important, it is a common mistake to think that if, say, 5000 car trips are priced off the road at 0800 that the occupants of those 5000 cars (which will be more than one per car on average) all catch a train or bus.

In Stockholm congestion pricing reduced trips over the cordon by 25% (Source: Centre for Transport Studies, Stockholm, CTS Working Paper 2014:7), but of that 25% the percentage breakdown of behaviour change varied:

• around 10% points were commuters that shifted mode (so only around 40% of car occupants went to other modes)
• around 6% points were discretionary trips (likely social, recreational, retail) that changed either the destination of travel at charging times or travelled less frequently.  So they still drove, just fewer times per week (consolidating trips) or to another destination not subject to pricing.
• around 5% of trips were commercial trips (deliveries, tradespeople, taxis) that disappeared, again likely due to consolidation of trips (deliveries being managed more efficiently, tradespeople booking work for a single trip across the cordon rather than multiple ones during a day)
• <2% changed route (using the bypass motorway to avoid the charged cordon).
• <1% changed time of travel, noting the Stockholm scheme operates all day, but has lower prices between the peaks. 

The key conclusion being that a great deal of behaviour change is having fewer discretionary trips and more efficient management of trips.

In London most shifted mode it is believed, to buses, but it is difficult to be sure because there was a significant uplift in the level of bus service, which is believed to have resulted in more trips in any case.

For Auckland it is proposed to only have charging during the peaks, so the potential for changing time of driving is significant, much more like Singapore, which only applies charges at times when demand slows traffic below stated performance levels (very few routes have charges outside peaks, especially post-Covid).

What would happen in Auckland?

If the first stage of congestion pricing were introduced, it is likely a significant proportion of motorists would shift mode of travel, assuming bus service reliability were back to pre-pandemic levels, and the City Rail Link is opened.  However, the majority would still drive. Of those that wouldn't, many would drive off-peak instead, some discretionary trips might go elsewhere at the peak, and some would not travel at all.  

It's worth noting that the highest peak charge was assumed to be NZ$3.50 (US$2.10). Over a work week this would be NZ$17.50, this is less than the normal public transport fares (there is currently a 50% discount applied by the Government to address the cost of living temporarily) and of course for many they also pay for parking.  

The inner city cordon is estimated to reduce car trips across Auckland by only 0.4%, and even if the FULL corridor scheme were eventually introduced, there would be a 1.3% reduction in trips.  This is enough to make a significant impact on travel times and trip reliability for the vehicles that ARE paying, plus of course buses.

It's also worth remembering that freight/logistics trips mostly cannot shift modes, and in many cases can't shift time of travel, but that isn't a reason not to price those vehicles using a scarce resource (road space) when they will benefit from it operating more efficiently.

Bus services can be improved significantly because of the effects of pricing

This is the almost instant "win" of congestion pricing, ignoring any money that might be raised and diverted into public transport. Reducing traffic congestion improves travel times for buses, improves trip reliability for buses, and enables more services to be operated with the same number of buses and drivers. FHWA (US) noted that in London:

 “Excess wait time” at bus stops fell by 24 percent across Greater London during the first full year of charging, with a 30-percent decrease within the zone itself.

Stockholm also saw such an improvement in trip times, that bus services that had been enhanced were cut back somewhat because too many services were operating with too few passengers. 

Congestion pricing CAN be designed to make life better for those driving

Many who support congestion pricing do so because they want fewer car trips, as an objective, but it is worth remembering that the goal of the original Congestion Question study was to improve network performance. Less congestion benefits those who pay to use the roads at peak time, because they have more reliable travel times, shorter travel times and also save on vehicle fuel/energy costs. Moreover, the use of net revenues can be applied to reducing or abolishing other motoring taxes, such as the NZ$0.125/l Auckland regional fuel tax (including GST), which apply to ALL road users, regardless of where and when they drive.  

Mayor Wayne Brown expressed concern that transport policy in Auckland under the previous Mayor was increasingly antagonistic towards drivers, but he could embrace road pricing as enabling better conditions for drivers and public transport users, and as a tool to reduce the burden on motorists outside peak times. 

What SHOULD happen?

The New Zealand Government should announce it is going to introduce legislation enabling congestion pricing under certain conditions. This won't force the Mayor of Auckland and Auckland Council to proceed with pricing, but will raise the question more explicitly, and it will enable Wellington (and other cities) to progress it, if they so wish.  

Given 2023 is election year in New Zealand (and polls indicate there is a reasonable likelihood the governing Labour Party would be voted out of office), it might be too much to expect this level of courage, but this IS a government that has set a target of reducing total kilometres driven by light vehicles, across the country, by 30% to meet climate change targets. To implement that requires measures much more intrusive than a congestion charge for central Auckland.

Congestion pricing in Auckland should not be delayed because the Mayor doesn't fully understand the impacts it will have. Government should enable it to happen, and progress detailed design for the preferred scheme options, with the intention of being able to implement it by 2026 at the latest (and if the Government changes after the election, it might help replace the Auckland regional fuel tax, which was implemented by the current government. 

A focus on making Auckland public transport more reliable and frequent is fine, but road pricing can help with that, and it would be wrong to lose momentum on Auckland road pricing because of concerns that can be easily addressed in the detailed design phase.

Western Australia to implement RUC for EVs, Auckland congestion charging to be announced, Virginia launches RUC in July 2022

I've been very busy, but there are some announcements worth noting as follows

Western Australia announces it will introduce distance-based RUC on EVs in 2017

As part of an package of measures to incentivise increased sales of electric vehicles, the Western Australian Premier has announced that the state government will introduce 

 introduce a distance-based road user charge for zero and low emission light vehicles commencing from July 1, 2027 to ensure all motorists pay their fair share towards the maintenance and construction of WA roads.

A base rate of 2.5 cents per kilometre for electric and hydrogen vehicles and two cents per kilometre for plug-in hybrid electric vehicles will apply, with both rates indexed to the Consumer Price Index.

This parallels what has already been announced in New South Wales, what has been introduced in Victoria in 2021 and what was also announced for South Australia (but for which the recently elected Labor Government has vowed to repeal).

Western Australia has some history in looking at heavy vehicle RUC, but it will be interesting to see how this may be implemented, as it could be a simple odometer reporting based system given there is little interstate light vehicle traffic. 

New Zealand Government to make announcement on progressing congestion pricing in Auckland next week

It has been studied and investigated for some time, but Radio New Zealand is reporting (alongside other media outlets) that when the New Zealand Government Emissions Reduction Plan is released on Monday 16 May, it will also announce it will implement congestion pricing for Auckland.  It is likely to be focused on a downtown inner city cordon-style scheme at peak times only, but with the potential to expand into corridor charging beyond that. It also appears that the net revenue may be used to offset a cut and eventual abolition of the Auckland Regional Fuel Tax established only in 2018 to help fund transport projects in the city.  That tax is currently at NZ$0.125 per litre including Goods and Service Tax.

Virginia to launch RUC for EVs on 1 July 2022

Virginia will be the third US state to implement distance-based RUC for light vehicles on 1 July according to NBC12.  Branded "Mileage Choice" it will offer EV, hybrid or other ultra fuel efficient vehicle owners the choice of paying by mile instead of paying a flat annual fee for registration (currently US$109 per annum).  Distance will be measuredly a plug-in device supplied by Emovis, with an initial odometer reading captured by smartphone imaging to register.