everyone How paying for yourself is better for society and the - - PowerPoint PPT Presentation

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everyone How paying for yourself is better for society and the - - PowerPoint PPT Presentation

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Green and fair mobility for everyone How paying for yourself is better for society and the environment Created by Rayan Aebi, Panos Alamanos, Giannis Alexou October 15, 2015 Presented by Mario Malzacher Growth expectations for private

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Green and fair mobility for everyone

How paying for yourself is better for society and the environment

Created by Rayan Aebi, Panos Alamanos, Giannis Alexíou Presented by Mario Malzacher October 15, 2015

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Growth expectations for private mobility

Non-OECD: Increase by a factor of 2.5 to 3.5 (i.e. 350%) OECD: Increase by 30% in average

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Externalities of transport

Positive effects

Negative effects - Externalities Uncompensated negative cost that affects a party who did not choose to incur that cost

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  • Climate-change is the biggest threat to

economic recovery (Angel Gurria, OECD, 2009)

  • Failure of climate-change adaptation is in the

top 5 risks in terms of Impact (WEF, 2015)

  • The insurance industry estimates the potential

economic damage, caused by the impacts of global warming, to be hundreds of billions of dollars each year. (WWF, 2015)

Global warming

A A serious economic th threat

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Fossil fuel and transportation

  • Fossil fuel use accounts for 57% of global

greenhouse gas emissions (IPCC, 2007)

  • Almost all (95%) of the world's

transportation energy comes from petroleum-based fuels, largely gasoline and diesel. (EPA, 2013)

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Growth expectations for mobility and transport

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Growth expectations for mobility and transport

Global car gridlock will impose a lot of costs on society that drivers don't pay for

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Externalities due to transportation

58% 21% 13% 8%

Externalities by mean of transportation (EEA, 2002)

Car (private vehicle) Heavy-duty vehicles Other road vehicles Rail and water transport

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Costs of externalities

  • Environmental damage (for CH approx. 9bn, ARE, 2010)
  • Local, regional as well as international
  • Congestion (opportunity costs; for CH approx. 3bn, ARE, 2010)
  • In the EU + Norway and Switzerland (EU+2) external costs from transport

were estimated at 8 % of GDP (Infras/IWW, 2000)

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Stop subsidizing mobility

Who should pay for th the ext xternalities ?

Government? Tax payers? Victims?

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Stop subsidizing mobility

How to solve th the problem?

  • Often proposed solution: Invest in public transport (subsidize public

transport) and environmental regulations (enforcement)

  • But -> COSTLY (unfair taxation, for CH approx. 8bn), uncompensated

externalities of public transport exist as well (for CH approx. 1bn), etc.

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Stop subsidizing mobility

User-pays pri rinciple

Cost-effective solution Internalizing externality costs

  • Individual users pay!
  • > Use price system to internalize externalities
  • If individual users pay for externalities of their own mobility
  • > no subsidies for public transport is necessary
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Stop subsidizing mobility

User pays pri rinciple

  • Everyone pays his fair share
  • No free riders
  • All costs are incorporated -> no externalities anymore
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Internalize mobility’s externalities

Put t a pri rice on mobility

Phase out fossil fuel subsidies

Stop subsidizing mobility

Tax on mobility

Use money to reduce taxes

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Internalize mobility’s externalities

Put t a pri rice on mobility

Phase out fossil fuel subsidies

Stop subsidizing mobility

Tax on mobility

Use money to reduce taxes

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Phase out fossil fuel subsidies

  • Phasing out fossil fuel energy subsidies would have benefits more

than 15 times the cost (Copenhagen Consensus, 2015)

  • Implementable today across the entire world
  • Especially in developing countries

with extensive oil & gas subsidies

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Internalize mobility’s externalities

Put t a pri rice on mobility

Phase out fossil fuel subsidies

Stop subsidizing mobility

Tax on mobility

Use money to reduce taxes

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Stop subsidizing mobility

Pri rivatize th the public tr transportation sector

  • Subsidies are generally inefficient
  • Subsidies are in essence payments by the government to keep an

ineffective firm in business

  • Subsidies are dangerous
  • Set incentives for overuse of public transport
  • Urban sprawl (additional increase in mobility)
  • Do not compensate externalities
  • Discard public transportation subsidies
  • Transparent and fair pricing
  • Producers’ incentives aligned with their business model
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Internalize mobility’s externalities

Put t a pri rice on mobility

Phase out fossil fuel subsidies

Stop subsidizing mobility

Tax on mobility

Use money to reduce taxes

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Tax on mobility Ext xternalities

  • Noise nuisance
  • Air pollution
  • Climate warming
  • Water & Soil contamination
  • Shrink of biodiversity
  • Land take
  • Traffic jams
  • Accidents
  • Production externalities of vehicles
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Tax on mobility Ext xternalities

Defined by personal mobility data according to means of transportation and local levels of taxation

TAX FULL EXTERNALITY COST

=

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Tax on mobility Fair pricing – Smart algorithm

Factors Evaluation + measurement Peak hour (congestion time) Time of the day Distance GPS location Location GPS location Fuel efficiency Car reference Noise level Car reference Particles and greenhouse gases levels Car reference Amortized production externality Car reference (Life cycle assessment)

Impartial transparent measurement agency: NGO

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Tax on mobility

In Incentives

35 45 60 60 40 15

CAR BUS TRAIN

Cost of use w/o externality cost (CHF) Externality cost (CHF)

NB: Estimation for a given distance

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  • Easily implementable today across the entire world
  • GPS technology is widespread and relatively cheap around the globe
  • Price incentives for the consumer to pursue the most efficient

mobility solution

  • Strong incentive to innovate

Tax on mobility

In Incentives

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Tax on mobility

In Innovation and smarter business solutions

  • Sharing economy
  • Self driving cars
  • Clean tech (e.g batteries, cars, buses, trains, planes)
  • New means of transportation (e.g. hyperloop by Elon Musk)
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Internalize mobility’s externalities

Put t a pri rice on mobility

Phase out fossil fuel subsidies

Stop subsidizing mobility

Tax on mobility

Use money to reduce taxes

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Better tax system

Use money to reduce taxes

  • Allow for a better tax system -> Reduce detrimental taxes (e.g. income tax in CH)

Local Global

  • Commune
  • Canton
  • Federal
  • (International)

Tax redistribution

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A bright green future

Towards a a better world

This smart mobility policy will empower

  • More efficient, transparent and fair use of transit transportation despite mobility growth
  • Less production of externalities
  • Compensation of social cost of mobility through individual user
  • Save real money and invest in our future
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A bright green future

Towards a a better world

Phase out fossil fuel subsidies

Stop subsidizing mobility Tax on mobility Use money to reduce taxes Any questions ?

Please contact me at: rayan.aebi@gmail.com