Urbanisation continues to expand worldwide and the higher mobility demand affects the quality of life and the use of energy in the cities. In this context, urban transport systems will play a vital role in supporting economic development and in significantly reducing emissions. Globally, there are hundreds of cities that adopted measures for reducing motorised transport and for promoting sustainable mobility. These measures have resulted in the optimisation of transport efficiency and of passenger mobility, have reduced congestion and have improved air quality.
Freight and passenger traffic increases constantly, especially in emerging economies. As of 2000, it has recorded an average growth of 4% per year. The global outcome was that the energy used in the transport system has increased by 30% in the past ten years which has also increased emissions by 2 billion tonnes/year, 90% of this figure coming from individual motorized transport, shows the latest report of the International Energy Agency (IEA), “A Tale of Renewed Cities” (published in July 2013), a report supported by EBRD.
The report analyses three case studies – Belgrade, Seoul and New York – and shows the way in which these cities have already improved their transport systems.
At the moment, the global transport sector represents half the oil consumption and around 20% of the energy consumption, 40% of which is used only in public transport.
According to the IEA estimates, “the energy used in public transport could double by 2050 despite the evolution of vehicle technologies and fuel consumption optimisation. It is necessary to implement an energy efficiency policy in order to reduce the level of noise, pollution, congestion and the negative environmental and economic impacts,”, the agency states.
The policies oriented towards the energy-efficiency of urban transport systems could save around USD 70 Trillion by 2050 from costs with vehicles, fuels and transport infrastructure.
“As the share of the world’s population living in cities grows to nearly 70% by 2050 and energy consumption for transport in cities is expected to double, the need for efficient, affordable, safe and high-capacity transport solutions will become more acute. Urgent steps to improve the efficiency of urban transport systems are needed not only for energy security reasons, but also to mitigate the numerous negative climate, noise, air pollution, congestion and economic impacts of rising urban transport volumes. Governments must think beyond individual technologies and electoral cycles, and consider how to build – and how to renew – cities that will accommodate and transport nearly 6.3 billion people by 2050. We must plan infrastructure, logistics and energy systems now that make sense today and over the coming decades,” said IEA Executive Director Maria van der Hoeven.
Policies and financing, the main factors for building-up transport markets
Policies play an important role in building-up the transport market and can direct the mobility decisions in favour of the transport modes which are not energy-efficient. Subsidies for fuel, the prioritisation of road infrastructure funds and development stimulants can encourage the markets in favour of motorized transport. The lack of information on travel options and the poor quality transport services have similar results.
In order to avoid failure in guiding transport markets, IEA recommends several policies which include policies on the demands (such as congestion and road tolls), regulatory policies (such as parking restrictions) and policies on offers/delivery (such as the extension of public transport infrastructure). Apart from these measures, the authorities have to eliminate the subsidies dedicated to private motorised mobility (those for fuel) and to set charging systems to reflect a wide range of the external costs of vehicles and fuels. .
Financial constraints manifest themselves because high upfront development and implementation costs are often required for transport infrastructure, travel demand management tools (for example, congestion pricing) and energy efficiency programmes (for example, subsidies for alternative vehicle technologies). These activities can also require long-term funding streams for operations and maintenance. Finding the right financing mechanism, therefore, is critical to the success of implementing transport system improvements.
Transport projects have been financed through public funds coming either from general fees or from specific revenues and the public sector has sustained the financing and investment risks for the respective projects. Moreover, the financial banks and institutions have had a key role in the financing and development of the transport sector. “Historically, financing has mainly been granted to the projects for the construction and maintenance of road infrastructure. But as the countries and the banks have become aware of the need for long-term solutions that were much more efficient for the mobility demand, the financing has been increased with the purpose of developing the non-road transport, including transit and non-motorised networks”, the report says. Thus, the governments have also developed new financing sources for developing the transport sector including revenues from road infrastructure charges, congestion, fees for parking and charges for developer. Also, the governments have changed their financing instruments, such as interest growth (TIF bonds) so as to finance urban development and transport projects.
As answer to the pressure of public budgets and to the limiting of the capacity to collect public revenues, the authorities are heading to the private sector for the investments necessary to transport projects. The participation of the private sector can be done through different types of agreements and PPPs, including PSC (public sector comparator) and BOT (build-operate-transfer) concepts.
The authorities can encourage private investments by implementing regulatory reforms in order to establish the transparency in the norms and regulations which govern transport infrastructure and the PPP structure. This transparency includes the establishment of competitive acquisitions with clear rules on the tendering and the selection process, the complete disclosure of conditions before the tendering process so as to facilitate negotiations, detailed agreements on the responsibilities and risks, explicit rules on cancellation or compensation, regulations for setting the prices in order to ensure the revenues while stimulating new participants.
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