Netherlands plans massive road-pricing scheme

Written by adam


How did I miss the fact that the Netherlands is planning to wire up the entire nation for a massive road-pricing scheme, starting in 2011? Sort of the love child of a congestion pricing program and a gasoline tax, the scheme will use satellite technology* to track every vehicle in the country and charge them per-mile-driven according to a flexible rate schedule. Initially the program will cover just commercial trucks, expanding over time to all vehicles by 2018.

According to the (surprisingly lucid) government proposal, the road pricing will be “differentiated by time, place and environmental characteristics while proportionally eliminating fixed charges.” It’s worth unpacking this a bit:

* Fees will vary according to time and location, so that the program can specifically target congested areas. This is similar to the congestion pricing scheme that has been successful in London, on a much larger scale. A similar scheme was recently rejected in New York City, and is now under consideration in San Francisco.
* Fees will vary according to the fuel efficiency of the vehicle, to encourage drivers to switch to cars with a lighter footprint.
* The entire program will be revenue neutral. As the program ramps up, the Netherlands will phase out its stiff motor vehicle tax. Such a system is inherently more fair: people who drive infrequently will actually pay less under the new system. Heavy drivers will pay more.

That last point is worth underlining. The knee-jerk reaction to such programs is that they’re regressive intrusions that saddle all drivers, but particularly low-income drivers, with new fees in the pursuit of some lofty environmental goal. This program is revenue-neutral, and will help to make roads more accessible to low-income drivers by charging people for actual road use rather than for car ownership. The system will also benefit drivers by reducing the amount of time stuck in traffic.

One interesting quirk of the system: because a straight vehicle tax is being swapped for a per-mile fee, cars will actually become cheaper and car ownership should therefore go up. Total miles driven, on the other hand, will drop. This sort of “mobility as a service” arrangement may become more common in the future. For example, Shai Agassi has been on a tear recently with Better Place, which aims to sell electric vehicles on a pay-as-you-go cell phone model.

Road pricing is also be considered by cash-strapped local governments here in the U.S. Facing crumbling roads and a nearly-bankrupt public transportation system, Rhode Island is considering imposing a per-mile fee. The system would be less sophisticated than the one in the Netherlands — relying on odometer readings rather than satellites — so it wouldn’t bundle in a congestion pricing program. Also, because Rhode Island is in the United States, the proposal will be removed from consideration when enraged drivers burn down capitol building in protest.

\* For those freaked out by the privacy implications of the satellite-tracking system, your concerns may be assuaged by the extensive privacy controls the Dutch government is planning to put in place. Or they may not.

Via How We Drive.

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1 Comment

  1. Kenneth Dagel

    While I believe this could be an equitable system, who really wants the government tracking your every move and knowing where you are at all times. It’s 1984 in 2008!