In 2007, the United States Department of Transportation selected five metropolitan areas it considered suitable for congestion charging projects. The idea was simple – charge private road users to enter city centres, reducing congestion and raising funds in the process. But four years on and progress is less than positive. New York city has twice thrown out plans for a congestion charge, and San Francisco is waiting until 2015 to begin its trial period. When the most enthusiastic response involves waiting four years, you know it’s not good news.
But as America postpones and battles against the congestion charge in its cities, on the other side of the pond it’s a different story. Launched in February 2003 by then-Mayor Ken Livingston, London’s congestion charge system charges private car users who enter the zone £10 ($16) per day between 7am and 6pm, Monday to Friday. The scheme has been a huge success, resulting in a 20% drop in car use, £120 million ($197 million) annual net-revenues, and the fastest growth rate for the city’s bus system since the 1940s.
Creating an economically-driven transportation demand management system like the congestion charge is controversial, and resistance isn’t an exclusively American reaction. Despite the scheme’s success in London, few cities in Europe – with the notable exception of Stockholm and Milan – have followed the British capital’s lead.
Environmental benefits appear to present a compelling argument. 22% of London’s overall CO2 emissions come from ground based transport, with 49% of those coming from cars and motorcycles. As a result of the congestion charge, CO2 emissions fell by 16% within the charging zone, with nitrogen oxides and particulate emissions dropping too. Functional benefits also exist. Average traffic speeds have increased by 37%, with delays to private journeys decreasing by 30% and bus journeys by 50%. Speedier journeys have also reduced average taxi fares.
The bus network also benefited. To prepare for the likely increase in bus ridership as a result of the congestion charge, 250 new buses were introduced. In fact, much of the revenue from London’s congestion charge is used to fund public transport developments, making the scheme part of a growing trend towards revenue neutrality, where project revenues are fully reinvested.
However, the scheme’s harshest critics call it an ‘economic failure’, citing poor economic benefits compared to the annual running costs. But such an argument – whilst likely true – is not important. A profit making system would certainly not be frowned upon, but London’s congestion charge exists primarily to tackle the problems involved in using the city’s roads, not turn a profit.
The small size of London’s congestion charging zone has also received come criticism. At only 1.5% of Greater London’s area and with 5.2% of the city’s residents, it is not a large zone. Whilst this arguably creates a more functional transport demand management system, it does reduce overall environmental benefits. Any reductions in emissions within this area – despite being significant – only represent a fraction of London’s total emissions. This means that air quality in London as a whole has barely improved since the congestion charge began.
The pricing system of London’s congestion charge is essentially non-variable, limiting control over traffic flow. Despite discounts for residents and certain vehicle types, the £10 daily charge applies to almost everyone, regardless of when they traveled or time spent in the congestion charging zone. An alternative approach could have made the city more capable of managing its traffic. In Singapore, the congestion charge varies by time of day, location within the charging zone, and type of vehicle using the space. In addition to this, the fee structure is adjusted quarterly to ensure the city’s speed targets are met.
Despite its imperfections, London opted for a more simple system, which has been a huge success. The British capital’s experience shows that congestion pricing is technically achievable and effective, and that initial political and institutional resistance to such pricing can be overcome. It remains to be seen whether that is the case in American cities, and with San Francisco’s proposed trial not starting until 2015, it could be a long wait.
This article was originally written for Next American City – a nonprofit organisation, dedicated to promoting socially and environmentally sustainable economic growth in America’s cities.