Supplementary Information: Detailed Appraisal

Appraisal Criteria

Each package will be assessed against the following criteria:

Research Objective
- Reduce Car Kilometres by 20% by 2030
Deliverability
- Feasibility
- Affordability
- Public Acceptability
STAG Criteria
- Environment
- Climate Change
- Health, Safety, and Wellbeing
- Economy – has two sub-criteria:

- Transport Economic Efficiency (TEE) covers the benefits ordinarily captured by standard cost-benefit analysis – including traffic volumes, journey times, driver frustration or travel time reliability

- Wider Economic Impacts (WEIs) refer to any economic impacts which are additional to transport user benefits. How might the option help attract new jobs, help existing businesses, open up appropriate land for development?

Equality and Accessibility

Policy Alignment

The appraisal will also consider the option’s position in the Sustainable Investment Hierarchy.

Appraisal Scale

Each option will be assessed on a 7 point scale defined as follows:

Major Positive +++
Moderate Positive ++
Minor Positive +
Neutral 0
Minor Negative -
Moderate Negative --
Major Negative ---

For the deliverability criteria, a risk-based approach has been used, categorising options as follows:

High
Medium
Low

The assessment will be based on the quantitative analysis where available, supported by qualitative analysis.

Cordon-based Charging

Research Objective

Reduce Car Kilometres by 20% by 2030

Minor Positive

Cordon charges around ‘Large Urban Areas’ are likely to be most successful at reducing car kilometres as these capture the largest traffic flows. Modelling the effects of a cordon charge around ‘Large Urban Areas’ could result in reduction of vehicle km of between 7% and 16% for the range of charges studied compared to a 2030 scenario without any TDM measures. The overall magnitude of impact against a 2019 baseline would depend on wider changes in society and travel behaviour between 2019 and 2030, for example in how behaviours developed during COVID-19 do or do not persist, as well as the impact of other Scottish Government initiatives.

Practically, a national framework of support would be essential to ensure all large urban areas implemented charging schemes in a coordinated and timely manner in order to achieve these levels. These figures therefore represent a best case scenario for cordon charging than would be likely in practical terms and within the timeframe necessary.

Overall cordon-based charging has a minor positive impact on the research objective given, in the defined scope, it is expected to have the potential to contribute towards the 20% reduction target, but will be unable to meet it.

Deliverability

Feasibility

Medium Risk

There are several cordon charging schemes in operation worldwide, proving the technical and operational feasibility of discrete schemes. If cordon charging was implemented on a widespread scale, there may be challenges with procurement and installation due to the quantity of automatic number plate recognition (ANPR) infrastructure required, however, the quantity of ANPR cameras required is less than area-based charging, given only the boundary requires enforcement infrastructure.

A cordon charging scheme will need boundary refinement to ensure they do not displace traffic onto unsuitable and environmentally sensitive routes.

Though the Transport (Scotland) Act 2001 provides local authorities with discretionary power to implement local schemes, these can only apply to local roads, and further secondary legislation would be required so that local authorities could enforce the schemes. In order to enable all large urban areas to implement schemes in a coordinated and timely way, significant national government support would be required.

Affordability

Medium Risk

Cordon charges around ‘Large Urban Areas’ could raise between £525 million and £875 million for the range of charges studied, providing additional funds for local transport projects. The cost of implementing local road pricing in Scotland’s Large Urban Areas is estimated between £100 million and £500 million. Cordon charging should be towards the lower end of this estimate given the quantity of ANPR cameras required is less than area-based charging as only the boundary requires enforcement infrastructure. Operating costs for each of the four charging zones is expected to be between 20% and 50% of revenue generated. A shared back office functions and financial support from Scottish Government through a transport demand management framework could reduce the cost burden on individual authorities substantially.

Public Acceptability

High Risk

All proposed charging measures, particularly those which are intended as deterrents to car travel, are likely to be met with significant public opposition. Cordon charges which are implemented in locations with an existing congestion problem are likely to be more accepted than those in locations where the problem is less obvious.

People who live just outside the cordon may perceive the charging structure as unfair, since they would have to pay to travel to destinations within the cordon while people who live just within the cordon would not have to pay for the same trip. This may result in opposition due to the perception of unfairness. However only applying cordon charging in ‘Large Urban Areas’ improves likely acceptability given the potentially greater availability of good public and active travel connectivity. Hypothecation of any revenue can also be a particularly effective method of improving public acceptability. People who have fewer alternatives to car travel are likely to be more opposed to cordon charging, including disabled people, older people, and socioeconomically disadvantaged people who may live in areas with poorer connectivity and be reliant on a car, or who may need to travel to work at times of the day when public transport is not available.

Overall Cordon Charging entails a high public acceptability risk due to the perceptions of unfairness around what journeys are charged.

STAG Criteria

Environment

Moderate Positive

There is evidence that cordon charging reduces car demand at a local level but could result in a shift in traffic flows to routes which are currently quieter. While an overall reduction in demand would have a positive impact on biodiversity and habitats, landscape and noise and vibration, shifting negative impacts from an existing high traffic route to a lower traffic route would have negative impacts. These quieter alternative routes are likely to be more sensitive to the impacts associated with an increase in traffic. The impact against these sub criteria is therefore considered to be minor negative.

The nature of cordon charging means it is likely to be implemented in the most congested areas with the highest traffic flows, and this is likely to coincide with the worst air quality. The negative environmental impacts of air quality depend on the local concentration of pollutants, so reducing emissions in the most congested areas would have the biggest impact on air quality. There may also be some rerouting as a result of cordon charging. However, if alternative routes are close to existing routes, then rerouting may not shift emissions far enough away to make a major difference to air quality. It is also important to note that the nature of cordon charging means there is no disincentive for internal travel within the cordon. This could even encourage people to drive more within the cordon to improve value for money, which could increase emissions and worsen air quality within the cordon, which as previously noted is likely to have poor air quality and be more susceptible to an increase in emissions. The impact against this sub criterion is therefore considered to be major positive.

Cordon charging is not expected to change the physical characteristics of the existing road network, only the traffic flows, so the impacts on geology and soils, land use, ecology and flooding, and historic environment are expected to be neutral.

Climate Change

Minor Positive

As shown in Table 3-2, modelling results suggest cordon charging around ‘Large Urban Areas’ would result in a reduction of CO²e emissions of between 7% and 17% for the range of charges studied.

The impacts of cordon-based charging on vulnerability to the effects of climate change and potential to adapt to the effects of climate charge are expected to be neutral.

Health, Safety and Wellbeing

Minor Positive

The nature of cordon charging means it is likely to be implemented in the most congested areas with the highest traffic flows, and this is likely to coincide with accident hotspots. Reduced traffic flows in congested areas will reduce the number of conflicts thus reducing risk of accidents. However, if the reduction in traffic results in an increase in speed, this may increase the severity of accidents. Without the mitigation of road space reallocation being guaranteed, the impact against this sub criterion is therefore expected to be minor negative.

The technology required to implement cordon charging has potential implications for security of personal data. While ANPR technology is already in use; widespread use for road pricing would increase the coverage and therefore potentially increase the level of damage if hacked or compromised. However, the likelihood of a security breach is extremely low, so the overall impact against this sub criterion is therefore expected to be neutral.

Cordon charging is expected to be implemented in areas with high congestion and thus relatively poor air quality. The negative health impacts of air quality depend on the local concentration of pollutants, so reducing emissions locally would have an overall positive impact on health. However, if sensitive receptors are located on alternative routes, health impacts may just be displaced, rather than removed. Reduced congestion may contribute to increased levels of walking and cycling, which would bring additional health benefits. The impact against this sub criterion is therefore considered to be moderate positive.

Access to health and wellbeing would be unchanged in terms of physical access. However, affordability is likely to be a barrier to access for some groups (see affordability sub criterion under Equality and Accessibility Criterion below) if the health or wellbeing infrastructure is within the cordon boundary. The impact against this sub criterion is therefore considered to be minor negative.

There is evidence that cordon charging reduces car demand at a local level but could result in a shift in traffic flows to routes which are currently quieter. While an overall reduction in demand would have a positive impact on visual amenity, shifting negative impacts from an existing high traffic route to a lower traffic route would have negative impacts. These quieter alternative routes are likely to be more sensitive to the negative visual amenity impacts associated with an increase in traffic. The impact against this sub criterion is therefore considered to be minor negative.

Economy

Minor Positive

Cordon charging has the potential to improve journey times and reliability by reducing congestion. However, potential rerouting could result in a shift in congestion from one route to another. The benefits are likely to be higher where alternative routes are not available or are also captured by cordons. The impact against TEE (Transport Economic Efficiency) is therefore considered to be minor positive.

There may be some limited land use changes where people move to live within the cordon or businesses move to locations outside the cordon. This could be mitigated by other measures such as reform of non-domestic rates, out-of-town levies or planning moratorium as suggested in the 2021 Town Centre Action Plan to rebalance the costs of business location choice. The net agglomeration impacts are likely to be neutral. The impact against WEI (Wider Economic Impacts) is therefore considered to be neutral.

Equality and Accessibility

Minor Negative

Cordon charging could indirectly positively affect public transport and active travel network coverage given the existing legislation states net proceeds should be used to support objectives of the local transport plan, however this impact is lesser than other options given the revenue generation potential is significantly less. Additionally, if the scheme was successful in reducing traffic levels it could improve bus journey times and potentially enable more services to run. Similarly, if there were fewer conflicts between pedestrians/cyclists and cars then walking and cycling journey times would be reduced if there was a combination of less traffic and space reallocation. The impact against these sub criteria is therefore considered to be neutral, given the limited revenue raising potential.

Comparative access by people group and geographic location would be unchanged in terms of physical access, however, affordability is likely to be a barrier to access for some groups (see affordability sub criterion below). The impact against these sub criteria is therefore considered to be neutral.

As for all proposed charging measures, cordon pricing will make driving less affordable. While the impacts against disabled people and rural poor have been mitigated in the appraised scheme, due to an exemption to all charges for blue badge holders and discounted rates for those with the lowest 20% of incomes in remote rural areas, there may be other groups for which impacts cannot be fully mitigated such as those who depend on car use for travel outside the hours of operation for public transport or who do not feel safe using public or active modes. Such groups may include women, LGBT+ people, younger people, older people, people with disabilities, people belonging to ethnic or religious minority groups and those travelling with young children. Cordon charging would also have a greater impact on people with low incomes due to charges making up a higher proportion of their income. There is also an affordability impact around the cordon boundary, with potential for inequality in a ‘self-sufficient’ large urban area, with those within the cordon not needing to pay, but those outside travelling in being liable for the charge. Therefore, the affordability impacts will vary with the geographical and travel characteristics of the area and the design of the cordon boundary.

There may be some positive effects on affordability of public transport if reduced congestion results in sufficient journey time savings to allow bus operators to operate the same service frequency with fewer buses, reducing operating costs. Bus savings are more achievable in locations such as cities and towns where congestion is having a significant impact on journey times, and where services tend to be more frequent and cover shorter distances. Cordon charging implemented in these locations is likely to result in a minor positive affordability impact in terms of public transport.

Overall the impact of Cordon Charging on Equality and Accessibility is minor negative due to the differences in affordability impacts depending on whether resident inside or outside the boundary and relatively low revenue generation potential for hypothecation into public and active travel.

Policy Alignment

Moderate Positive

Cordon charging would contribute to the 20% car reduction target identified in the Climate Change Plan and aligns positively with the NTS2 priorities to “Takes climate action” and “Improve health and wellbeing” although potentially conflicts with the priorities to “Deliver inclusive economic growth” and “Reduce inequalities”. The option has the potential to complement public transport and active travel options recommended through STPR2, by encouraging modal shift to sustainable and increasing the usage of such options, ultimately improving value for money.

Cordon charging also aligns with planning policy outlined in the NPF4, which encourages increased opportunity for local living and implementation of 20 minute neighbourhoods; strengthening support for development in town centres and restricting out-of-town retail and leisure to encourage a transition away from car-dependent developments and stimulating new models of low carbon living in our rural areas as well as our towns and cities, by facilitating further investment in digital infrastructure, building in more space for people to work remotely and creating community hubs.

There may be some conflicts with the Equalities Act (2010) and the Fairer Scotland Duty due to potential negative differential impacts on affordability for women, LGBT+ people, younger people, older people, people with disabilities, people belonging to ethnic or religious minority groups, and people experiencing socio-economic disadvantage. It may be possible to mitigate these negative impacts through the option design, for example through discounts, exemptions, and hypothecation of revenue to public transport and active travel improvements.

Sustainable Investment Hierarchy

Makes better use of existing capacity

Area-based Charging

Research Objective

Reduce Car Kilometres by 20% by 2030

Moderate Positive

There is evidence that area-based charging can be effective in reducing car trips. However, this is likely to be most effective in locations where most trips passing through the area have origins or destinations within the area. For trips through the area, area-based charging could encourage rerouting, which may even increase car kilometres in some cases where an alternative route is longer. However, this rerouting effect is likely to be less than for cordon-based charging. Once within the charged area there is also no financial disincentive to travelling within the area that day given the daily nature of the charge. Area-based charging may also encourage people to park their vehicles just outside the charging area, which might limit the potential reduction in car kilometres if the charging area is relatively compact.

Area charges which cover all trips to, from and within ‘Large Urban Areas’ are likely to be most successful at reducing car kilometres as these capture the largest traffic flows. As shown in Table 3-3, the effects of area charges around ‘Large Urban Areas’ could result in reduction of vehicle km of between 14% and 25% for the range of charges studied compared to a 2030 scenario without any TDM measures. Practically, a national framework of support would be essential to ensure all large urban areas implemented charging schemes in a coordinated and timely manner in order to achieve these levels.

In the absence of a national framework of support, with just Edinburgh and Glasgow implementing schemes as a result of local authority initiative, the model outputs shown in Table 3-4 indicate a reduction of between 9% and 16% nationally, falling short of the national target.

The overall magnitude of impact against a 2019 baseline would depend on wider changes in society and travel behaviour between 2019 and 2030, for example in how behaviours developed during COVID-19 do or do not persist, as well as the impact of other Scottish Government initiatives.

Overall area-based charging has a major positive impact on the research objective given, in the defined scope, it is expected to meet the 20% Car Kilometres reduction target.

Deliverability

Feasibility

Medium Risk

There are several area charging schemes in operation in the UK, proving the technical and operational feasibility of discrete schemes. However, if area charging was implemented on a widespread scale in Scotland, there may be challenges with procurement and installation due to the quantity of ANPR infrastructure required. Area-based charging would require more enforcement infrastructure than a cordon charge given the entire area requires monitoring.

An area charging scheme will need boundary refinement to ensure they do not displace traffic onto unsuitable and environmentally sensitive routes.

Delivering all four large urban areas within a similar timeframe would require significant support and intervention from the Scottish Government and this would be required in order to produce an impact large enough to achieve the 20% reduction target.

Affordability

Medium Risk

As shown in Table 3-3, area charges around ‘Large Urban Areas’ could raise between £790 million and £1.3 billion per year for the range of charges studied, providing significant additional funds for local transport projects.

The cost of implementing local road pricing in Scotland’s Large Urban Areas is estimated between £100 and £500 million. Area charging should be towards the upper end of this estimate given the quantity of ANPR cameras required is greater than cordon-based charging as all parts of the charging area requires enforcement infrastructure. Operating costs for each charging zone is expected to be between 20% and 50% of revenue generated. Shared back office functions and financial support from Scottish Government through a transport demand management framework could reduce the cost burden on individual authorities substantially.

Public Acceptability

Medium Risk

All proposed charging measures, particularly those which are intended as deterrents to car travel, are likely to be met with significant public opposition. Area charges which are implemented in locations with an existing congestion problem are likely to be more accepted than those in locations where the problem is less obvious.

People who live within the area may perceive the charging structure as unfair, since they would have to pay the charge every time they travelled by car but the perceived unfairness for those outside the zone is less given everyone traveling within the zone is paying, not just those who have passed the area boundary as is the case with cordon charge. However only applying area charging in ‘Large Urban Areas’ improves acceptability given the potentially greater availability of good public and active travel connectivity. Hypothecation of any revenue can also be a particularly effective method of improving public acceptability.

People who have fewer alternatives to car travel, are likely to be more opposed to area charging, including disabled people, older people, and socioeconomically disadvantaged people who may live in areas with poorer connectivity and be reliant on a car, or who may need to travel to work at times of the day when public transport is not available.

STAG Criteria

Environment

Major Positive

There is evidence that area charging reduces car demand at a local level but could result in a shift in traffic flows to routes which are currently quieter, although this impact is likely to be less than for cordon charging. Area charging also targets short-distance movements within the area, where cordon charging is unable to do so. While an overall reduction in demand would have a positive impact on biodiversity and habitats, landscape and noise and vibration; shifting negative impacts from an existing high traffic route to a lower traffic route would have negative impacts. These quieter alternative routes are likely to be more sensitive to the negative impacts associated with an increase in traffic. The impact against these sub criteria is therefore considered to be neutral.

The nature of area charging means it is likely to be implemented in the most congested areas with the highest traffic flows, and this is likely to coincide with the worst air quality. The negative environmental impacts of air quality depend on the local concentration of pollutants, so reducing emissions in the most congested areas would have the biggest impact on air quality. While the rerouting effect due to area charging is likely to be less than for cordon charging, it could still impact on air quality. If sensitive receptors are located on alternative routes, air quality impacts may just be displaced, rather than removed.

While area charging, unlike cordon charging, targets trips with origins and destinations within the charging zone, the capped nature of area charging means there is no disincentive for further travel once that charge has been paid for the defined time period. This could even encourage people to drive more to improve value for money, which could increase emissions and worsen air quality within the area, which as previously noted is likely to have poor air quality and be more susceptible to an increase in emissions. Despite this, an area charging is likely to disincentivise short distance urban trips that should be easily substitutable and that have a disproportionate impact on pollutant emissions. The overall impact against this sub criterion is considered to be major positive.

Area charging is not expected to change the physical characteristics of the existing road network, only the traffic flows, so the impacts on geology and soils, land use, ecology and flooding, and historic environment are expected to be neutral.

Climate Change

Major Positive

As shown in Table 3-3, modelling results suggest area charging in ‘Large Urban Areas’ would result in a reduction of CO²e emissions of between 15% and 26% for the range of charges studied.

The impacts of area charging on vulnerability to the effects of climate change and potential to adapt to the effects of climate charge are expected to be neutral.

Health, Safety and Wellbeing

Minor Positive

The nature of area charging means it is likely to be implemented in the most congested areas with the highest traffic flows, and this is likely to coincide with accident hotspots. Reduced traffic flows in congested areas will reduce the number of conflicts thus reducing risk of accidents. Area charging also targets short-distance movements within the area, where cordon charging is unable to do so. This is likely to disincentivise short distance urban trips that should be easily substitutable and that have a disproportionate impact on accidents. However, if the reduction in traffic results in an increase in speed, this may increase the severity of accidents. Without the mitigation of road space reallocation, the impact against this sub criterion is therefore expected to be minor negative.

The majority of air quality management areas in Scotland are in highly congested urban areas. Area charging is expected to be implemented in areas with high congestion and relatively poor air quality. The negative health impacts of air quality depend on the local concentration of pollutants, so reducing emissions or shifting emissions from a more polluted area to a less polluted area would have an overall positive impact on health. However, if sensitive receptors are located on alternative routes, health impacts may just be displaced, rather than removed. There is also a risk that once the charge has been paid there is no disincentive to travel which could even increase emissions and worsen air quality. Reduced congestion may contribute to increase levels of walking and cycling, which would bring additional health benefits. Area charging also targets short-distance movements within the area, where cordon charging is unable to do so. This is likely to disincentivise short distance urban trips that should be easily substitutable and that have a disproportionate impact on pollutant emissions. The impact against this sub criterion is therefore considered to be major positive.

Access to health and wellbeing would be unchanged in terms of physical access, however affordability is likely to be a barrier to access for some groups (see affordability sub criterion under Equality and Accessibility Criterion below) if the health or wellbeing infrastructure is within the area boundary. Therefore, the impact against this sub criterion is therefore considered to be minor negative.

There is evidence that area charging reduces car demand at a local level but could result in a shift in traffic flows to routes which are currently quieter. While an overall reduction in demand would have a positive impact on visual amenity; shifting negative impacts from an existing high traffic route to a lower traffic route would have negative impacts. These quieter alternative routes are likely to be more sensitive to the negative visual amenity impacts associated with an increase in traffic. The impact against this sub criterion is therefore considered to be minor negative.

Economy

Minor Positive

Area charging has the potential to improve journey times and reliability by reducing congestion. Area charging also targets short-distance movements within the area, where cordon charging is unable to do so. This is likely to disincentivise short distance urban trips that should be easily substitutable and that have a disproportionate impact on congestion, affecting journey times and reliability. However potential rerouting could result in a shift in congestion from one route to another. The benefits are likely to be higher where the area captures the highest traffic flows and any potential alternative routes. The impact against TEE is therefore considered to be minor positive.

There may be some limited land use changes where people or businesses move outside the area. This could be mitigated by other measures such as reform of non-domestic rates, out-of-town levies or planning moratorium as suggested in the 2021 Town Centre Action Plan to rebalance the costs of business location choice. The impact against WEI is therefore considered to be neutral.

Equality and Accessibility

Neutral

Area charging could indirectly affect public transport and active travel network coverage given the existing legislation states net proceeds should be used to support objectives of the local transport plan. Additionally, if the scheme was successful in reducing traffic levels it could improve bus journey times and potentially enable more services to run. Area charging also targets short-distance movements within the area, where cordon charging is unable to do so. This is likely to disincentivise short distance urban trips that should be easily substitutable and that have a disproportionate impact on traffic levels. Similarly, if there were fewer conflicts between pedestrians/cyclists and cars then walking and cycling journey times would be reduced if there was a combination of less traffic and space reallocation. The impact against these sub criteria is therefore considered to be minor positive.

As for all proposed charging measures, area pricing will make driving less affordable. While the impacts against disabled people and rural poor have been mitigated in the appraised example schemes, due to an exemption to all charges for blue badge holders and discounted rates for those with the lowest 20% of incomes in remote rural areas, there may be other groups for which impacts cannot be fully mitigated such as those who depend on car use for travel outside the hours of operation for public transport or who do not feel safe using public or active modes. Such groups may include women, LGBT+ people, younger people, older people, people with disabilities, people belonging to ethnic or religious minority groups and those travelling with young children. Area charging would also have a greater impact on people with low incomes due to charges making up a higher proportion of their income.

There may be some positive effects on affordability of public transport if reduced congestion results in sufficient journey time savings to allow bus operators to operate the same service frequency with fewer buses, reducing operating costs. Bus savings are more achievable in locations such as cities and towns where congestion is having a significant impact on journey times, and where services tend to be more frequent and cover shorter distances. Area charging implemented in these locations is likely to result in a minor positive affordability impact in terms of public transport.

Overall the impact of Area Charging on Equality and Accessibility is neutral given the negative impacts of the additional cost of driving on individuals is balanced by the significant revenue generation potential which must be invested in local public and active travel measures, providing the largest benefit to those on low incomes and less likely to own a car.

Policy Alignment

Moderate Positive

Area charging would contribute to the 20% car reduction target identified in the Climate Change Plan and aligns positively with the NTS2 priorities to “Takes climate action” and “Improve health and wellbeing” although potentially conflicts with the priorities to “Deliver inclusive economic growth” and “Reduce inequalities”. The option has the potential to complement public transport and active travel options recommended through STPR2, by encouraging modal shift to sustainable and increasing the usage of such options, ultimately improving value for money.

Area charging also aligns with planning policy outlined in the NPF4, which encourages increased opportunity for local living and implementation of 20 minute neighbourhoods; strengthening support for development in town centres and restricting out-of-town retail and leisure to encourage a transition away from car-dependent developments and stimulating new models of low carbon living in our rural areas as well as our towns and cities, by facilitating further investment in digital infrastructure, building in more space for people to work remotely and creating community hubs.

There may be some conflicts with the Equalities Act (2010) and the Fairer Scotland Duty due to potential negative differential impacts on affordability for women, LGBT+ people, younger people, older people, people with disabilities, people belonging to ethnic or religious minority groups, and people experiencing socio-economic disadvantage. It may be possible to mitigate these negative impacts through the option design, for example through discounts, exemptions and hypothecation of revenue to public transport and active travel improvements.

Sustainable Investment Hierarchy

Makes better use of existing capacity

Distance-based Charging (Variable Rate)

Research Objective

Reduce Car Kilometres by 20% by 2030

Major Positive

Though few real-world examples currently operate, distance-based charging is considered by many research studies to represent the optimum solution to the question of efficiently pricing road usage and thereby reducing car kilometres. Distance-based charging would allow for charges to be directly placed on the amount of driving undertaken and have the greatest impact on longer length journeys which make up the majority of car kilometres travelled in Scotland. While a flat rate distance-based charge would not have the same impact in urban settings given the short distances, and consequently low charges encountered, a variable charge based on rural/urban classification would enable charging to be targeted both short and long-distance trips.

As shown in Table 5‑1, modelling the effects of distance-based variable rate charges indicates a reduction in vehicle km of between 8% and 26% for the range of charges appraised compared to a 2030 scenario without any TDM measures. The overall magnitude of impact against a 2019 baseline would depend on wider changes in society and travel behaviour between 2019 and 2030, for example in how behaviours developed during COVID-19 do or do not persist, as well as the impact of other Scottish Government initiatives.

Evidence from the roll-out of energy smart meters suggests that the behaviour changing effect of better access to price information leads consumers to make more informed choices. Similarly, distance-based charging provides opportunity for greater levels of feedback to the consumer on the real-time cost of a journey. As such, distance-based, variable rate charging scores as major positive in respect of the research question.

Deliverability

Feasibility

Medium Risk

Distance-based variable rate charging requires an effective means of estimating the exact distances travelled by the individual vehicle and there are both high and low-tech solutions to this.

Drivers could submit their mileage through an online portal, or through another platform for those without internet access with the possibility for checks at MOT, insurance, or police spot checks. While this is a practical option, there is a risk of illegal vehicle ‘clocking’ to avoid charges.

Telematic technology could be used instead, and this already has widespread usage in commercial fleets and as part of some insurance schemes. However, linking devices and undertaking a mass procurement and roll out of new devices under a single system will be logistically challenging. Telematic tracking makes use of the Global Navigation Satellite System (GNSS) system and there are known ways in which this system can be bypassed – known as ‘jamming’ or ‘spoofing’. For this reason, a GNSS based system would likely require checking and enforcement by ANPR or checks similar to the low-tech self-mileage submission option. Any form of manual checking requires a significant ‘back office’ of staff to monitor and process data. For these reasons, although the technology is readily available to deliver distance-based charging, the overall feasibility risk is higher than the low-tech solution.

Affordability

Medium Risk

The feasibility study for a UK national distance-based charging estimated set up costs of £3bn and annual running costs of £2-3bn (Source: Department for Transport (2004) Feasibility study of road pricing in the UK - Full report). The proposed Netherlands national scheme is estimated to have a set up cost of €2.2bn and annual running costs of 250-900m euros. However, implementation costs of a national, distance-based scheme are highly dependent on the way in which it is implemented. A distance-based, variable rate charging system using the option of mileage self-submission would require the development of an online portal and associated IT infrastructure to host the website and data stored which will involve significant expenditure. A telematics-based solution would be more costly given the capital expenditure required to purchase telematic devices and on the creation of a network of ANPR cameras, ongoing costs associated with maintenance of the system and revenue costs associated with the ‘back office’ of staff required to monitor and process the data. On board units (OBUs) commercially retail at around £30 each. Supplying one to each of the 2.5 million cars in Scotland would be in the order of £100m (assuming no economy of scale). However, smartphone app-based systems or a hybrid approach could be significantly cheaper.

Because of the intricacies of such a system is its unlikely that local authorities would have the capacity to administer local distance-based charging systems. It is therefore likely that distance-based charging would be administered at the national level. The initial capital, maintenance and revenue costs would therefore be borne by the Scottish Government, while the cost of the telematic devices, if introduced, could be passed on to the user, or as a deduction from the road user charge. Collectively, the initial capital costs and ongoing revenue costs for a national scheme would be significant.

Public Acceptability

Medium Risk

The public acceptability of a distance-based variable rate charge depends on how the scheme is implemented and the level of the charge applied. There is likely to be public support for a fairer form of motoring taxation, with distance-based charging directly related to how much people drive, making for a fairer and more balanced system, if it were to ultimately replace existing fuel duties.

People who have fewer alternatives to car travel, are more likely to be opposed to distance charging, including disabled people, older people, and socioeconomically disadvantaged people who may need to travel to work at times of the day when public transport is not available. However, a variable rate charge could be tailored further by geographical area and income group in order to mitigate these potential effects and improve acceptability.

Additionally, there are public acceptability challenges with compelling individuals to install tracking devices in their vehicles which would pose a significant barrier to delivery. This could potentially be overcome by working with the car insurance industry to design policies which require telematics as a precondition of insurance cover. The lower-tech approach of submitting milage readings would also potentially be more acceptable.

There remains a high degree of uncertainty around the exact pathway for delivery of distance-based charging. A charging design that was mindful of the availability of different travel options in different areas and hypothecation to positive alternative modes of travel could also help acceptability.

STAG Criteria

Environment

Minor Positive

Distance-based variable rate charging could encompass the entirety of the public road network and therefore avoid unwanted environmental impacts associated with traffic re-routeing to avoid charges. However, there may still be some re-routing from longer distance or circuitous motorways or ring roads to local roads less able to cope with high traffic volumes. The overall impact of road transport on the environment would reduce in proportion to the number of vehicle kilometres saved. Introducing a geographical variable component to the charge could well target trips most damaging to air and noise quality. Charging by distance and location alone would not shift vehicle or engine choice away from more polluting types, unless this was also a variable parameter for engine type in the charge.

Though the installation of the required ANPR infrastructure would have some impacts on the environment, effectively managing demand would reduce or eliminate the need for additional road capacity works, resulting in an overall positive impact of this option on geology and soils, land use, ecology and flooding, and historic environment.

Climate Change

Major Positive

Distance-based charging with a variable rate for different locations would be one of the most efficient ways of managing demand for road use as it effectively targets all types of car journeys. While internal combustion engine vehicles are still in use, this would have a strongly positive impact on reducing greenhouse gas emissions. As zero emissions vehicles assume the majority of the vehicles in use, the impact on greenhouse gas emissions will be less, with the level of this reduction dependent on the overall mix of energy production.

As shown in Table 5‑1, the reductions in CO²e emissions as a result of variable rate distance charging would be between 8% and 27% more than would be the case without charging for the range of charges studied.

The embodied carbon within vehicle production would potentially be reduced if distance-based charging led to mode switching and a reduction in the number of vehicles manufactured and purchased.

The impacts of distance-based charging on vulnerability to the effects of climate change and potential to adapt to the effects of climate charge are expected to be neutral.

Health, Safety and Wellbeing

Minor Positive

A distance-based variable rate charge could reduce the number of vehicles using the road and hence the number of accidents would be expected to fall. However, any reduction in traffic volumes could lead to increased speed and increase the severity of accidents. Without the mitigation of road space reallocation, this would lead to a minor negative impact against this sub-criterion.

The technology required to implement a geographically based variable distance -based charging has potential implications for security of personal data. While ANPR and in-vehicle telematic technology is already in use; widespread use for road pricing would increase the coverage and therefore potentially increase the level of damage if hacked or compromised. However, the likelihood of a security breach is extremely low, so the overall impact against this sub criterion is therefore expected to be neutral.

Reduction in demand across the network and commensurate shifts in travel behaviour towards more active and sustainable modes would create an overall positive impact on health, with the level of positive impact being dependent on how these journeys were redistributed and level of road space relocation as a result of less traffic.

Access to health and wellbeing would be unchanged in terms of physical access, however affordability is likely to be a barrier to access for some groups (see affordability sub criterion under Equality and Accessibility Criterion below) and has been mitigated in the option design with some exemptions.

Economy

Minor Positive

Distance-based charging has the potential to improve journey times and reliability by reducing congestion. However, potential rerouting to the shortest distance route could result in a shift in congestion from high-capacity roads such as motorways to local roads with less capacity and more vulnerable to congestion. However, variable distance-based charges provide a constant price signal to the decision maker about their journey. The impact against TEE is therefore considered to be minor positive.

If a distance-based charge encourages densification of land use, there may be improvements to productivity. However, demand for transport is derived from economic activity and economic growth (GDP) and traffic growth (vehicle km) have, historically, been closely correlated. If a charge were over-applied to the extent that that the costs imposed were disproportionate to the societal benefit gained, there would be a highly negative impact on the wider economy. The impact against WEI is therefore considered to be minor positive.

Equality and Accessibility

Neutral

Distance charging could indirectly affect public transport and active travel network coverage given it is assumed any revenue generated will be spent on national transport priorities and according to the sustainable investment hierarchy. Reduced traffic levels as a result of this option could both improve bus journey times and enable reallocation of road space for active travel. The impact against these sub criteria is therefore considered to be minor positive.

As for all proposed charging measures, distance-based pricing will make driving less affordable. A flat rate distance charge would disproportionately impact rural residents who need to travel further to access key services as a result of less dense land use. However, a variable charge by rural/urban classification could disproportionately affect those on low-incomes in urban areas who may lack of flexibility of workplace location or work hours when public transport provision is poor or non-existent. The impact against these sub criteria is therefore considered to be minor negative.

Reduced congestion could result in sufficient journey time savings to allow bus operators to operate the same service frequency with fewer buses, reducing operating costs. Bus savings are more achievable in locations such as cities and towns where congestion is having a significant impact on journey times, and where services tend to be more frequent and cover shorter distances.

Overall, the impact against Equality and Accessibility criteria is neutral given the charge can be designed to mitigate to some extent the impact on rural communities and those who find it most difficult to switch modes and has potential to generate significant revenue to fund national transport projects, providing the largest benefit to those on low incomes and less likely to own a car.

Policy Alignment

Moderate Positive

Distance charging would contribute to the 20% car reduction target identified in the Climate Change Plan and aligns positively with the NTS2 priorities to “Takes climate action” and “Improve health and wellbeing” although potentially conflicts with the priorities to “Deliver inclusive economic growth”. The effect on “Reduce inequalities” is uncertain, there is potential within this option to mitigate negative impacts on this objective. The option has the potential to complement public transport and active travel options recommended through STPR2, by encouraging modal shift to sustainable and increasing the usage of such options, ultimately improving value for money.

Distance charging also aligns with planning policy outlined in the NPF4, which encourages increased opportunity for local living and implementation of 20 minute neighbourhoods; strengthening support for development in town centres and restricting out-of-town retail and leisure to encourage a transition away from car-dependent developments and stimulating new models of low carbon living in our rural areas as well as our towns and cities, by facilitating further investment in digital infrastructure, building in more space for people to work remotely and creating community hubs.

There may be some conflicts with the Equalities Act (2010) and the Fairer Scotland Duty due to potential negative differential impacts on affordability for women, LGBT+ people, younger people, older people, people with disabilities, people belonging to ethnic or religious minority groups, and people experiencing socio-economic disadvantage. However, it may be possible to further mitigate these potential negative impacts through the option design, through differential costs for short and long journeys, and the hypothecation of revenue to public transport and active travel improvements

Sustainable Investment Hierarchy

Makes better use of existing capacity

Distance-based Charging (Flat Rate, Variable Allowance)

Research Objective

Reduce Car Kilometres by 20% by 2030

Moderate Positive

Charging each kilometre travelled above a prescribed allowance would allow for direct targeting of those who drive the most frequently and over the longest distances, while having little impact on those who drive less frequently or over short distances. Therefore, it is well targeted to reducing long distance trips which make up the majority of the car kilometres travelled in Scotland. Conversely it is not well targeted to discretionary short distance trips and could help to incentivise these types of trips if someone has not used up their allowance. This can be partially mitigated against if an allowance trading scheme was implemented but this would add complexity to the system. While improving acceptability, a free milage allowance would reduce the effectiveness of the measure by reducing the number of journeys affected by the charge.

Evidence from the roll-out of energy smart meters suggests that the behaviour changing effect of better access to price information leads consumers to make more informed choices. However, this effect will be less applicable in cases where those who drive the least are not charged as the price signal of a trip only applies after a certain number of kilometres have already been travelled.

Deliverability

Feasibility

Medium Risk

Distance-based charging requires an effective means of estimating the exact distances travelled by the individual vehicle and there are both high and low-tech solutions to this.

Telematic technology could be used instead, and this already has widespread usage in commercial fleets and as part of some insurance schemes. However, linking devices and undertaking a mass procurement and roll out of new devices under a single system will be logistically challenging. Telematic tracking makes use of the Global Navigation Satellite System (GNSS) system and there are known ways in which this system can be bypassed – known as ‘jamming’ or ‘spoofing’. For this reason, a GNSS based system would likely require checking and enforcement by ANPR or checks similar to the low-tech self-mileage submission option. Any form of manual checking requires a significant ‘back office’ of staff to monitor and process data. A flat rate distance-based charged with variable allowances has a medium feasibility risk given it can be implemented with either low or high tech solutions.

Affordability

Medium Risk

As shown in Table 5‑1, the potential revenue that could be raised as a result of implementing distance-based variable rate charging would be in the order of £1bn to £2.5bn per annum. A flat rate charge which only applies after a certain number of kilometres have been travelled may limit the revenue generated given only the excess kilometres will be charged as drivers would be incentivised to not drive over their free allowance. Though the potential for revenue generation would be more limited, the set up and operation costs would be very similar.

The feasibility study for a UK national distance-based charging estimated set up costs of £3bn and annual running costs of £2-3bn . The proposed Netherlands national scheme is estimated to have a set up cost of €2.2bn and annual running costs of 250-900m euros. However, implementation costs of a national, distance-based scheme are highly dependent on the way in which it is implemented. A distance-based, variable rate charging system using the option of mileage self-submission option would require the development of an online portal and associated IT infrastructure to host the website and data stored which will involve significant expenditure. A telematics-based solution would be more costly given the capital expenditure required to purchase telematic devices and on the creation of a network of ANPR cameras, ongoing costs associated with maintenance of the system and revenue costs associated with the ‘back office’ of staff required to monitor and process the data. On board units (OBUs) commercially retail at around £30 each. Supplying one to each of the 2.5 million cars in Scotland would be in the order of £100m (assuming no economy of scale). However, smartphone app-based systems or a hybrid approach could be significantly cheaper.

Because of the intricacies of such a system is its unlikely that local authorities would have the capacity to administer local distance-based charging systems. It is therefore likely that any distance-based charging would be administered at the national level. The initial capital, maintenance and revenue costs would therefore be borne by the Scottish Government, while the cost of the telematic devices, if introduced, could be passed on to the user, or as a deduction from the road user charge. Collectively, the initial capital costs and ongoing revenue costs for a national scheme would be significant.

Public Acceptability

Medium Risk

The public acceptability of a distance-based charge varies depending on how the scheme is implemented. There is likely to be public support for a fairer form of motoring taxation, with distance-based charging directly related to how much people drive, making for a fairer and more balanced system, if it were to ultimately replace existing fuel duties.

A system of a free milage allowance and a flat charge for kilometres travelled beyond that similar to the personal tax allowance, would provide the potential for a more publicly acceptable option, giving motorists the opportunity to exempt themselves from any charge by moderating their car use. Only those who make excess car trips and contribute the most to the overall car kilometres travelled would encounter a charge.

People who have fewer alternatives to car travel, are likely to be more opposed to distance charging, including disabled people, older people, and socioeconomically disadvantaged people who may need to travel to work at times of the day when public transport is not available. However, exemptions would be applied for people with a disability affecting their mobility and those in low income groups living in remote rural areas would be given additional mileage allowance given their lower ability to pay and greater legitimate need for travelling longer than average distances.

If tracking devices are chosen to enforce this option, these pose public acceptability challenges with compelling individuals to install tracking devices in their vehicles which would pose a significant barrier to delivery. This could potentially be overcome by working with the car insurance industry to design policies which require telematics as a precondition of insurance cover. The lower-tech approach of submitting milage readings, with checks/audits at MOTs would potentially be more acceptable.

There remains a high degree of uncertainty around the exact pathway for delivery of distance-based charging and public acceptability will depend on which pathway is chosen.

STAG Criteria

Environment

Minor Positive

Distance-based, variable allowance charging could encompass the entirety of the public road network and therefore avoid unwanted environmental impacts associated with traffic re-routeing to avoid charges. However, there may still be some re-routing from longer distance or circuitous motorways or ring roads to local roads less able to cope with high traffic volumes. The overall impact of road transport on the environment would reduce in proportion to the number of vehicle kilometres saved. However, in terms of noise and air quality, charging by distance alone would not shift vehicle or engine choice away from more polluting types, unless this was also a variable parameter for engine type in the charge.

Given the nature of free mileage and flat rate charging for excess kilometres, the charge cannot be well targeted to areas of congestion, so will have less impact on noise and air pollution than other forms of charging which can be designed to reduce the volume of traffic in hotspots.

Climate Change

Moderate Positive

A flat rate distance-based charge with a set free mileage allowance could effectively manage demand for road use and cut down the overall number of kilometres travelled. While internal combustion engine vehicles are still in use, this would have a strongly positive impact on reducing greenhouse gas emissions. As zero emissions vehicles assume the majority of the vehicles in use, the impact on greenhouse gas emissions will be less, with the level of this reduction dependent on the overall mix of energy production.

As the potential for vehicle kilometre reduction would be lower where a free allowance, rather than a variable rate, were implemented, the potential for reduction in GHG emissions will also be lower.

The embodied carbon within vehicle production would potentially be reduced if distance-based charging led to mode switching and a reduction in the number of vehicles manufactured and purchased. The impact against greenhouse gas emissions is therefore minor positive.

The impacts of distance-based charging on vulnerability to the effects of climate change and potential to adapt to the effects of climate charge are expected to be neutral.

Health, Safety and Wellbeing

Minor Positive

A distance-based charge, variable allowance could reduce the number of vehicles using the road and hence the number of accidents would be expected to fall. However, any reduction in traffic volumes could lead to increased speed and increase the severity of accidents. Without the mitigation of road space reallocation, this would lead to a minor negative impact against this sub-criterion.

If a low tech solution was implemented, relying on user submitted mileage readings, verified at MOTs there would be limited impact against the security sub criterion. However, if telematic technology was chosen, this has potential implications for security of personal data. While ANPR and in-vehicle telematic technology is already in use; widespread use for road pricing would increase the coverage and therefore potentially increase the level of damage if hacked or compromised. However, the likelihood of a security breach is extremely low, so the overall impact against this sub criterion is therefore expected to be neutral.

Access to health and wellbeing would be unchanged in terms of physical access, however affordability is likely to be a barrier to access for some groups (see affordability sub criterion under Equality and Accessibility Criterion below) and has been mitigated against in the option design with some exceptions

Economy

Minor Positive

A flat rate distance-based charge with a set free mileage allowance may improve journey times and reliability by reducing congestions. However, the charge is not well targeted to areas where this is an issue which may limit the impact against this sub criterion. There is also potential rerouting to the shortest distance route which could result in a shift in congestion from high-capacity roads such as motorways to local roads with less capacity and more vulnerable to congestion. Unlike a geographically variable distance charge, the presence of a free allowance means that the price signal of completing a trip only emerges after a set number of kilometres have already been travelled. Therefore, the impact against TEE is neutral.

Equality and Accessibility

Neutral

Distance charging could indirectly affect public transport and active travel network coverage given it is assumed any revenue generated will be spent on national transport priorities and according to the sustainable investment hierachy. Reduced traffic levels as a result of this option could both improve bus journey times and enable reallocation of road space for active travel. The impact against these sub criteria is therefore considered to be minor positive.

Comparative access by people group and geographic location would be unchanged in terms of physical access. However, affordability is likely to be a barrier to access for some groups who may be more car dependant given their health or geographic area. As for all proposed charging measures, distance-based pricing will make driving less affordable. A flat rate distance charge could disproportionately impact rural residents who need to travel further to access key services as a result of less dense land use. To mitigate this, an additional free allowance could be allocated for those who are both within the lowest 20% income group and living in areas defined as ‘remote rural’. This free allowance could also be extended to low-income groups in accessible rural areas and remote small towns which experience similar issues with accessing services and travelling longer distances. The exemption for people with a disability which affects their mobility would also mitigate the negative impacts on this group. However, a variable allowance by rural/urban classification could disproportionately affect those on low-incomes in urban areas who may lack of flexibility of workplace location or work hours when public transport provision is poor or non-existent. The impact against comparative accessibility and affordability is therefore minor negative given the option is able to be tailored to mitigate the impacts on different groups and remove the need to pay altogether for a large portion of the population.

Overall, the impact against Equality and Accessibility criteria is neutral given the charge can be designed to mitigate the impact on rural communities and those who find it most difficult to switch modes. Additionally, it could be designed so as to avoid impacting the majority of drivers and focus on those who drive significantly more than average. The potential to generate significant revenue to fund national transport projects provides the largest benefit to those on low incomes and less likely to own a car.

Policy Alignment

Moderate Positive

There may be some conflicts with the Equalities Act (2010) and the Fairer Scotland Duty due to potential negative differential impacts on affordability for women, LGBT+ people, younger people, older people, people with disabilities, people belonging to ethnic or religious minority groups, and people experiencing socio-economic disadvantage. It may be possible to mitigate these negative impacts through the option design, for example through differential allowances, and the hypothecation of revenue to public transport and active travel improvements

Sustainable Investment Hierarchy

Makes better use of existing capacity

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