GRACE

03.27
2007
The aim of GRACE is to provide new evidence on the costs of transport infrastructure use for all modes of transport, and on the consequences of charging these costs to users. This involves studies to measure the marginal cost of wear and tear, congestion, accidents and environmental impacts. For road and rail this emphasized filling gaps in existing knowledge on costs; for air and water, there was much less work on which to build.

We used GRACE estimates of external costs to analyse the effect of implementing marginal social cost pricing on the composition of transport flows and welfare. The TREMOVE model was used to analyse 3 possible pricing scenarios, which varied in the complexity of the pricing reform simulated. Some of the main results are:

- it is very difficult to use the fuel tax as the only instrument to address all the externalities of cars and motorcycles
- the way the extra tax revenues are used is as important as the selection of the pricing reform scenario
- the welfare gains come mainly from a reduction of external accident costs, a reduction of external congestion costs and from a good use of the extra tax revenues;
- the pricing reform policies suggested here are not yet a complete mix to address the different externalities, some externalities like accident externalities need more refined instruments like fines for speeding or alcohol in order to signal the social costs of drivers’ behaviour.
For more details we refer to Deliverable 9.

Period

2007

Client

European Commission, 6th Framework Programme

Partner

University of Leeds (UK), VTI (Sweden), Universiteit Antwerpen, DIW (Germany), ISIS (Italy), KU Leuven, adpC, Aristotle University of Thessalonika (Greece), BUTE (Hungary), Christian-Albrechts University (Duitsland), Ecoplan (Switzerland), IER University of Stuttgart (Germany), University of Las Palmas (Spain) en Uniwersytet Gdanski (Poland)

Our team

Griet De Ceuster, Eef Delhaye, Bart Van Herbruggen, Olga Ivanova
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