January 11, 2006 2:00 am

Oregon drives ahead with road-pricing pilot scheme

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The tangle of wires and gadgets assembled round a table at a building at Oregon State University looks much like the equipment for any number of post-graduate engineering projects.

However, the work being undertaken by two academics and a group of post-graduate students in the bare concrete shed in Corvallis, western Oregon, could have unusually profound consequences well beyond the sparsely populated, north-western US state.

The team are putting the finishing touches to technology for a year-long pilot programme, to be launched in spring 2006 by Oregon's state government, to record how much and when a group of volunteers use their cars on the state's roads.

The drivers of the 280 cars involved will pay directly for their road use rather than through the traditional, indirect tax on fuel purchases.

Such schemes - known as road-pricing schemes in Europe and per-mile fees in the US - are attracting attention from policymakers worldwide. Revenue through fuel tax is falling as cars grow more efficient. Fuel tax also does little to reduce the growing problem of congestion.

Singapore already charges cars for using the most congested parts of its road network at the busiest times and several countries, including Switzerland, Germany and Austria, charge trucks for using at least some of their roads.

In 2004 the UK said it planned eventually to become the first large country to introduce road-pricing to replace fuel taxes nationwide.

The Oregon scheme has attracted interest because its approach appears to combine unusual simplicity with affordability and flexibility.

The scheme was devised after Oregon's state legislature in 2001 ordered a taskforce to examine alternatives to its existing petrol tax. After adjustments for inflation, cars' increasing fuel efficiency had reduced the tax revenue per mile driven on Oregon's roads from 2.31 cents in 1970 to 1.16 cents in 2003.

The fall represents a problem for Oregon, according to James Whitty, manager of Oregon State Department of Transportation's Office of Innovative Partnerships and Alternative Funding, because the state's large land area requires an extensive road network. Its sometimes severe weather also necessitates heavy road maintenance.

"We're in a situation where the public won't allow gas tax increases either to cover fuel efficiency or inflation," he says. "Revenues are drying up."

The scheme focuses far less than most road-pricing projects on using sophisticated pricing to change drivers' habits.

While the pilot will offer some scheme participants discounts for driving off-peak or on lightly used roads, most participants will be charged a flat fee based on the typical per-mile cost for cars of the state's petrol tax, according to Mr Whitty.

"We are going to be collecting data on behaviour changes, but that's not the fundamental purpose," he says.

Instead, the scheme has been designed to see whether proven technology and existing systems can produce an effective means of collecting per-mile charges.

A meter in each car will pinpoint its location via a satellite-positioning beacon, then use the car's odometer to measure distances driven within the state's boundaries.

The fee will be collected at petrol stations, like the existing fuel tax. During the pilot scheme, two Portland petrol stations will be fitted with sensors that will download the meter readings when drivers with fitted cars buy fuel.

The 24 cents per gallon petrol tax will be automatically deducted from the bill and the car's current outstanding mileage fee added.

"We've driven the [system's] cost way down," Mr Whitty says.

David Kim, the OSU professor who has devised the technology with his colleague David Porter and a group of post-graduate students, admits there have been challenges. However, most have been overcome.

If the pilot project runs smoothly, it will be a big step forward in the US's until-now theoretical debate on per-mile charging, according to Mr Whitty.

"Until we can practically implement the thing, it cannot be taken seriously," he says.

Mr Whitty's office should have legislation for a state-wide mileage fee scheme, drawing on lessons from the pilot, ready for the state legislature in 2009.

Yet even if the Oregon legislature decides against pursuing it, Mr Whitty believes the pilot has produced ideas so powerful that someone will use them.

Other US states have already expressed interest, while the US federal government is paying $2.1m of the pilot's $2.8m cost.

Japanese officials are coming to discuss the scheme this month, while Alistair Darling, the UK transport secretary, has said the Oregon scheme is one of several under consideration by his department.

"I predict that this concept will become compelling enough for some governmental institution somewhere to try it out," Mr Whitty says. "The stress on the current road system will be too great."

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