Urban Transport in the OIC Megacities
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However, the single most important fiscal instrument related to vehicle use is fuel charging. Transport
fuel taxation has historically been a key part of government fiscal policy due to its characteristics as a
stable, dependable revenue source that is easily administered, and typically has progressive
characteristics. In addition, it is also now widely recognized as a key mechanism to facilitate the
internalization of external costs imposed by vehicle use, manage total transport demand, influence
vehicle and modal choice, and promote urban densification. However, direct subsidies continue to be
issued by many governments, facilitating the widespread use of automobile and rendering other
modes financially non-viable (Rode et al, 2014).
Except for measures that apply at national level, city specific measures for managing vehicle use
include road pricing, parking charges and other user fees. For example, Singapore, London and
Stockholm have successfully implemented congestion charging schemes, leading to a reduction in
emissions and congestion while generating increased revenues for transport investment. To be most
effective, fiscal instruments need to be designed and implemented at a system level, and coordinated
with institutional and regulatorymeasures. For example, simulations of policy combinations involving
increasing car operating costs by 75 percent and decreasing public transport fares by 50 percent for
seven European cities, supported by improved land use policies and improvements in public transport
functioning, have demonstrated clear synergy effects of coordinating private vehicle and public
transport pricing policies (Rode et al, 2014).
Alternative technologies
The role of technology is also important and it has the potential to improve the efficiency of transport
operations, reduce the impact of automobile use and promote behavioural change. Technological
change is expected to play an increasingly significant role in the reduction of greenhouse gas
emissions. Technology based mobility innovations in cities may include the introduction of new
technology, the innovative use of existing technology and infrastructure or a combination of both.
Regulatory interventions such as emission or fuel consumption standards have been proved highly
effective in triggering substantial technological innovation. In many instances, they have also
increased the global competitiveness of vehicle manufacturers that were exposed to more stringent
regulation. In terms of vehicle technology, innovations in engine and fuel technologies, digitisation
and materials have the potential to significantly improve the efficiency of motorized vehicles in cities
(Rode et al, 2014).
A summary of the most common alternative fuels and vehicle technologies is provided i
Table 3: Summary of common alternative fuels and vehicle technologies
Description Advantages Disadvantages
Internal combustion engine
vehicles can be modified to
use bio fuels which are liquid
transport fuels produced
from recycled vegetable oils
or starch and sugar plants.
• As the plants grow, they take
up CO2, which is then released
back into the atmosphere when
the fuel is burned
• Political interest is growing
and the sugar industry is well
placed to benefit from ‘carbon
finance’
• Additional energy input is
required to process the fuel
• Energy yields vary with crop.
For example, yields from
rapeseed and wheat are an order
of magnitude lower than sugar
cane
• Increases in world population
will place more demand on food
production than bio fuel from
agricultural land
• Bio fuels are more expensive
than conventional fuels and they
need to be heavily subsidised