sectoral economic costs and benefits of ghg mitigation - IPCC

Ranjan K. Bose
Theoretically, an emission tax has been suggested by the experts to be the most effective means
to reduce pollution, because it would provide consumers with incentives to choose the least-cost
options across these two approaches. But, in practice such a tax would be weighed down by need
for effective emission monitoring, which is difficult. A more practical strategy would be to
reduce both emissions and congestion, using a mixed set of instruments, which are dictated by
either command or control, and/or the market based principles (Table 1). The instruments are
taxes on fuels, vehicles, and parking; incentives and regulations affecting vehicles with a view to
reduce the rate of growth in ownership of personal vehicles; and traffic management and the
provision of public transport alternatives.
Reduce mass emissions
The following measures are required to reduce emissions per vehicle kilometre travelled: (1)
enforcing higher maintenance standards on existing vehicles, in order to keep emissions closer to
the design standards of the vehicles; (2) introducing vehicles designed to meet new emission
standards; (3) introducing unleaded fuels (with or without catalytic converters) for the rapid
reduction of atmospheric lead, and (4) retrofitting motor vehicles to use other kinds of fuel
modifications or fuels, such as compressed natural gas (CNG), liquefied petroleum gas (LPG) or
propane.
Reduce total vehicle kilometres travelled
This can be accomplished by either reducing the total demand for travel or altering the mix of
vehicles used to carry travellers. The first option may be achieved in part by increasing the cost
of travel. More important is improved spatial planning to reduce the total demand for travel.
Table 1
Taxonomy of policy instruments to control motor vehicle emissions
Market based
Command and control regulations
Direct Indirect Direct Indirect
Vehicle
Emission fees Differential vehicle
taxation; tax allowance for
new vehicles; promote
retrofit with alternative
fuels
Fuel
- Differential fuel taxation
with dirtier fuel to be
taxed higher; high fuel
taxes; remove subsidies
from kerosene
Emission
standards
Phasing out of
high polluting
fuels; fuel
composition
Periodic inspection
and maintenance
programme; use of
low polluting vehicles;
scrapping of polluting
vehicles
Fuel economy
standards; speed limits
Traffic
- Congestion and parking
charges; subsidies for lesspolluting
modes
Physical restraint
of traffic;
designated routes
Restraints on vehicle
use; bus lanes and
other priorities
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