Congestion Pricing (Part 1 of 2): New Frontiers

What cities come to mind when you hear “congestion pricing”? London? Singapore? Stockholm? For the past decade, these have been the cities that were the shining examples of demand management. By charging a toll to drive into the urban center, these cities reduced automobile congestion and raised revenue for urban transportation improvements. Congestion pricing, however, had yet to be applied to a non-developed world city.  Luckily for many cities which could benefit from congestion pricing, a new example exists.

Worldwide, cities making proposals to begin congestion pricing in their urban centers would point to London, Singapore, and Stockholm as the ultimate goal. But this is an issue for those proposing for two reasons: their unrivaled urban character and their developed world status. These three cities are some of the densest and most prolific urban centers in the world, that are very attractive to large financial institutions, big business headquarters, and tourists! If a city like Atlanta were to propose congestion pricing, and point to these three cities as its vision, it would certainly get some laughs. Mentioning Atlanta in the same sentence as these three is foolish; the urban fabric is vastly different and the downtown core is dwarfed by these top world cities.

The second issue is that these are three of the richest cities in the world. Developing and implementing congestion pricing is expensive and requires well-developed ITS infrastructure. Many cities which could benefit greatly from congestion pricing, such as the dense cities of the developing world, do not have the resources to implement like London, Singapore, and Stockholm. Nor do these cities have a model to base their project off of, which would differ due to lower motorization rates, different levels of personal purchasing power by the driving population, and a greater variety of modes.

Alas, there is now a developing world model for congestion pricing. Tehran implemented congestion pricing in April 2010, and information on the project can be found on their website, including a Google map of all the charging stations – over 100 in all. This blog post on Road Pricing covers a lot of the details on the project, and how it’s been performing, including an image of their toll collection signage.

Several aspects of the Tehran project make it useful for a developing city.

• First, it has been able to adopt a complex price structure, which would be necessary for a system that has a variety of modes. India’s traffic mix, for example, would need a system that caters to automobiles, autorickshaws, taxis, buses, and minibuses, and maybe even cycle rickshaws!
• Tehran makes use of a system using license plate detection, similar to London’s system, all performed with a single camera. This reduces the cost of the system for the operator and avoids distributing expensive transponders to vehicles.
• Tehran made the choice to only allow vehicles to enter the cordon that are registered to do so. Enforcement is typically an issue in developing countries, and by requiring permits to be purchased, they make it easier for police to enforce the system.
• Lastly, Tehran figured out how to apply congestion pricing to a city which has many narrow streets and hundreds of entries into the cordon. This will be a big issue to tackle for cities which have no major geographical barrier which already limits cordon crossings, and cities that have many smaller streets that could be used to bypass major tolled thoroughfares.

The significance of Tehran’s congestion pricing is that it is an exemplary project for the developing world. Cities can learn many lessons from the Tehran example, and it will open many new frontiers for congestion pricing. Engineers in developing megacities can now point to Tehran and say, “If they could do it, we can too!”