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Economic Incentives
 
Introduction
Why incentives make sense
Incentive-based approaches
Reducing society's waste mountain
Dealing with climate change
Beating traffic congestion
Addressing the barriers
Congestion pricing
Unhealthy urban air
Summing up
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BEATING TRAFFIC CONGESTION: NEW APPROACHES TO ROAD PRICING

The best estimate of the costs of congestion to Auckland now exceeds $1 billion. Road congestion is a huge burden on the city’s manufacturing, distribution and service businesses.

More roads and more public transport are needed. But overseas experience suggests that increasing transport capacity alone will not solve Auckland's congestion problem. There is also a need for an improved pricing system for transport networks.

New Zealand currently charges road users through a tax on petrol. But the price of petrol does not reflect the cost that an additional driver joining a motorway imposes on all other peak time users of the motorway, through congestion delays.

Under such a pricing system, the demand for costly new roading investments has shown itself in many countries to be almost insatiable. Those cities that have built new commuter rail systems have also not experienced much – if any – reduction in peak-hour automotive congestion.

Only where there is some additional pricing of the scarce resource (ie. peak time capacity on transport networks) has it been possible to beat congestion. This approach, used in Singapore, and several European cities including London, is called “congestion pricing.” But the road pricing approaches used in overseas cities need modification for New Zealand conditions.

One solution would be a comprehensive road pricing system for the Auckland region’s whole transport network, or at least its motorways and arterial routes, with the prices for using different sections depending on the level of congestion on that section at the time. There are two barriers to achieving such a system: one technical, the other political.

London's congestion pricing
Since being introduced in central London in 2003, congestion pricing has led to a 20% traffic reduction within the target zone, and a doubling of average speeds.

In the words of London’s Mayor, Ken Livingstone, “These results confirm that traffic congestion and journey times for motorists, bus passengers, and business journeys are significantly reduced both inside and outside the congestion charging zone.”



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