Description

Pricing or charging fees for behaviors harming air quality and generating traffic congestion. Examples are congestion charges, road tolls, and parking fees. They can also cover service fees for infrastructure and services such as water supply or waste collection. Municipal revenues from such schemes can contribute to financing related urban infrastructure.

Instrument category

Municipal own source revenue (OSR) and policy steering instruments

Implementation status

Moderate - tried and tested

Enabling conditions and success factors

• Strong municipal governance is needed to plan and implement such pricing and changing mechanisms.

Instrument benefits

• Charging and pricing can create significant behavioural change impacts, reducing the use of private vehicles that cause congestion and greenhouse (GHG) emissions.
• Revenue generation also helps to cover the scheme's costs and can provide additional revenue to invest in climate action.

Challenges and risks to implementation

• Opposition from user groups such as frequent drivers or businesses who believe that charging schemes will have a negative impact. However, there is mounting evidence from schemes (such as in London) that road users and businesses have experienced much greater positive than negative impacts following implementation.