EU countries would be allowed to charge heavy road users for the costs they incur on society, including congestion, air pollution and noise – something prohibited by EU law up till now – according to an early draft of a Commission proposal to revise its 'Eurovignette Directive'. The draft document seen by EurActiv suggests that toll prices on roads could be raised to include medical care for health problems relating to air and noise pollution, but also related productivity losses and welfare costs – for example due to sleep disturbance.
EU countries would be allowed to charge heavy road users for the costs they incur on society, including congestion, air pollution and noise – something prohibited by EU law up till now – according to an early draft of a Commission proposal to revise its 'Eurovignette Directive'.
The draft document seen by EurActiv suggests that toll prices on roads could be raised to include medical care for health problems relating to air and noise pollution, but also related productivity losses and welfare costs – for example due to sleep disturbance. Time loss, increased fuel consumption and vehicle maintenance costs caused by congestion, as well as crop losses and damages to the ecosystem caused by pollution could also be taxed. Costs related to traffic accidents, on the other hand, would be excluded.
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Such 'external cost' charges could come on top of those already levied in some countries to finance construction and maintenance work. They would be determined by an independent authority, based on formulae set out in the directive. A key aspect is that they would have to vary according to the type of road they are levied on, the time at which they are collected – be it rush hour or nighttime, for example – and the vehicle's 'Euro' emissions class (which covers NOx and particulate matter).
According to the draft, all European roads could be covered by these types of schemes, rather than just the Trans-European Transport Network as is currently the case. The collection of charges would have to be based on an electronic system "which avoids hindrances to the free flow of traffic and can subsequently be extended to a large number of other road sections without additional significant roadside investments".
Similarly to the existing directive, only vehicles weighing more than 3.5 tonnes , rather than individual cars, would be covered by the new 'external cost' charge, except for charges relating to congestion. Indeed, the text provides that if a country wants to make lorries pay for the congestion they cause, it can only do so if a similar charge is levied on cars too.
As for the money raised from 'internalising' these costs, the draft text states that member states will have to earmark revenues to finance "projects and measures aimed at reducing the external costs of transport, notably traffic management systems, measures to reduce pollution at sources, and the development of alternative infrastructure".
While the aim of the future legislation is simply to make it possible for countries to impose tolls and charges for transport-related environmental and social costs, the draft signals that the Commission will review the situation in 2013 to determine whether the possibility should become an obligation.
The current ban on including external costs in road tolls has had implications for other transport sectors, most notably rail, where Community legislation prevents any internalisation of external costs "as long as it is not the case in road transport".
The revision of the Eurovignette Directive therefore represents an important step in reducing the whole transport sector's impact on the environment and human health. The final version is expected to be presented in June, along with a package of other initiatives aimed at reducing the impact of other transport modes, including rail, aviation and maritime transport on the environment.
Positions
According to Commission sources, the draft document seen by EurActiv "concurs with the main pre-conclusions and the general philosophy" that is currently being pursued by the EU executive in terms of scope, factors to be included in 'external cost' charges, collection systems and earmarking of revenues.
But the sources nevertheless cautioned that "many questions remain wide open," as the document, which is being drafted by the Commission's DG Transport, has not yet been sent for inter-service consultation – a process in which other Commission departments, such as DG Environment or DG Enterprise, get to have a say on the plans.
Speaking to EurActiv, Damian Viccars, in charge of Social and Fiscal Affairs at the European office of the International Road Transport Union (IRU) , said he regretted the fact that the Commission appeared to be going ahead with an approach exclusively based on the "polluter pays" rationale.
"Policymakers see the internalisation of external costs via the Polluter Pays Principle as a panacea but it is in fact a limited and over simplified approach to the issue," according to IRU. While PPP may seem an "easy" way to collect taxes, it is "not an adequate response" because it is not based on any sound cost-benefit analysis or regulatory impact assessment, as the decision over who should pay is taken in advance, the association insists.
It instead argues for a strategy based on a Cheapest Cost Avoider Principle (CCAP), under which it would be left to the party that can prevent or abate the damage at the lowest cost for the overall economy to take action.
Regarding earmarking, Viccars told EurActiv that it would be "a fantastic step in the right direction" if the Commission would propose that funds raised from internalising external costs should be used exclusively for improving road transport, saying: "The money must be used to address the problem at source, not just to prop up member states' budgets."
He nevertheless said it would be important to see the "whole picture" of the Commission's planned "Green Transport Package" – and notably how the Commission intends to treat other modes – before judging the proposal.
The International Union of Public Transport (UITP) stresses the need to increase the contribution of private car usage to covering the external costs it produces. This is a key deficiency of the current Eurovignette Directive, which deals only with commercial vehicles and long-distance transport, despite the fact that the majority of transport-related external costs are concentrated in urban areas, it points out.
"With regard to passenger transport, the models should target the private car. Public transport should be exempted from tax burdens and should benefit from the revenue of hypothecated taxation on indirect beneficiaries," it stresses.
The Community of European Railways (CER) welcomed the revision as an important "first step" towards creating a level playing field for all modes of transport, adding that it would put an end to the "outrageous situation" whereby member states are prevented by EU law from charging trucks – i.e. the most polluting means of transport – for any of the costs they produce for society, be it climate change, local pollution, noise, accidents or congestion.
As for the earmarking of funds, the CER welcomed the fact that the use of revenues would be kept in the transport sector. However, it underlined its position that funds should be used "for investments that will further improve the possibilities for the least polluting modes to handle transport demand, the so-called modal shift".
João Vieira, policy officer at T&E, the European Federation for Transport and Environment , agreed that "if it's designed right, the updated Eurovignette Directive could be a major step in the right direction," by finally requiring transport users to pay for their negative impacts on society and the environment.
However, he highlighted "several worrying elements in the draft proposal".
"Firstly it makes no sense to extend the restrictive EU-level rules to local roads; local authorities are best placed to decide the level and scope of charges to deal with the specific challenges they face. Secondly, the EU should not restrict member states from including the costs of accidents in road charges - they are a massive cost to society and there is no justification for excluding them. Thirdly allowing member states to 'earmark' road charges for road building projects should be prohibited - this simply rewards pollution with the possibility of more pollution - it is a crazy idea," he told EurActiv.
Latest & next steps
- June 2008: Commission expected to table a universal model for the calculation of transport-related external costs and an impact assessment of various internalisation strategies.
