Intl Conference Budapest - 2-3 Sept.2004: CEI Results

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International Conference
Environmental harmful subsidies and ways to
eliminate them External Cost of Transport in
CEI Countries
Max Herry, HERRY Consult, Vienna Budapest, 3
September 2004
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MAIN SOURCES
INFRAS / HERRY 2003 External Costs of Transport
in Central and Eastern Europe, Commissioned by
OECD Environment Directorate and the Austrian
Ministry for Agriculture, Forestry, Environment
and Water Management, 2003 INFRAS / IWW
2000 External Costs of Transport Accident,
Environmental and Congestion Costs in Western
Europe, Commissioned by UIC 2000 HERRY 2003
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CONTENT Aim Methodology Results Con
clusions Western Europe Policy Conclusions
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CONTENT Aim Methodology Results Con
clusions Western Europe Policy Conclusions
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Aim of the Study

• Total and average environmental costs
  (Accidents, Noise, Air Pollution, Climate Change)
• CEI Countries Albania, Belarus,
  Bosnia-Herzegovina, Bulgaria, Croatia, Czech
  Republic, FYRO Macedonia, Hungary, Moldova,
  Poland, Romania, Slovak Republic, Slovenia,
  Ukraine
• Differentiation Road, Rail, Aviation,
  Waterborne
• Base year 1995, Outlook 2010 trend and EST
• Methodology based on UIC study

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Value Transfer Mechanism

• For each cost category, an appropriate key
  variable was taken
• This variable was combined with unit values
  valid for Europe as a whole
• The unit values were transferred by GDP per
  capita indices per country
• National currency were transferred to EURO by
  PPP adjustment (exchange rate 1995)

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CONTENT Aim Methodology Results Con
clusions Western Europe Policy Conclusions
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Methodology for Accidents - General

• Key variables Accidents in road traffic
  (ECMT) Accidents in rail traffic (UIC)
  Accidents in air transport (ICAO) Life
  expectancy (WHO)
• Unit values Average value of human life 1.5
  million EURO adjusted by GDP per capita
• Results Total accidents cost per mode

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Methodology for Noise - General

• Key variables Population density
  (differentiation in urban and regional
  population density) Traffic volume (vehicle km)
  Traffic density (vehicle km per road /rail km)
  Key country for the value transfer
  Germany, Greece (road), Western Europe (rail),
  Switzerland, Austria (aviation)
• Unit values Average willingness to pay per
  dB(A) based on UIC study 30 EURO per dB(A)
  average per household, adjusted by GDP per
  capita
• Results Total noise cost per mode

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Methodology for Air Pollution - General

• Key variables (from OECD study) Emission
  density (NOX, PM10 emissions per capita)
  Emission density (NOX, PM10 emissions per ha)
  Population density (differentiation in
  urban/rural)
• Unit values Health costs (per capita
  approach), Building damages and crop losses
  (per ha approach) from UIC study (similar
  value transfer)
• Results Total air pollution cost per mode

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Methodology for Climate Change - General

• Key variables CO2 emissions per mode
  Electrified tracks (rail) and CEI electricity
  mix, based on OECD/CEI study emission factors
• Unit values Average shadow value per tonne
  of CO2 national marginal avoidance costs based
  on Worldbank studies (range from 6 to 12 EURO
  per tonne, average value of 8 EURO) to reach
  Kyoto targets
• Results Total climate change cost per mode

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Methodology for Nature and Landscape

• Key variables Road length (network data,
  assumption on widths) Length of singledouble
  tracks (assumptions on widths) Number of
  airports (assumptions on average airport area)
• Unit values Unit values from Western Europe
  (repair costs per km2 infrastructure), PPP
  adjusted
• Results Total nature and landscape cost per mode

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CONTENT Aim Methodology Results Con
clusions Western Europe Policy Conclusions
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Results 1995 I

• Total external costs amounted to approx. 40
  billion Euro in 1995, being almost 14 of total
  GDP in CEI countries.
• Two cost categories are predominant
• about half of the total of 40 billion Euro are
  due to external accident costs
• more than 40 are costs caused by air pollution.
• Noise costs are approx. 3

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Results 1995 II
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Results 1995 III
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Results 1995 IV
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Results 1995 V
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Results 1995 VI
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Results 1995 VII
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Results 1995 VIII
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Results Outlook I
Outlook 2010 Assumptions

• Economic growth
• from 1995 to 2000 1.5 per annum,
• from 2001 to 2010 3.5 per annum.
• Traffic growth Trend EST3
• Road Pass. 83 32
• Road Freight 156 13
• Rail 8-9 70
• Aviation 80 80
• Other factors
• Change of unit values according to GDP/capita
• Reduction of emission factors

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Results Outlook II
Total costs Trend 58 EST3 7
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Results Outlook III
Outlook 2010 Total Costs Passenger transport
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Results Outlook IV
Outlook 2010 Total costs Freight transport
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Results Outlook V
Outlook 2010 Average Costs Road
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Results Outlook VI
Outlook 2010 Average Costs Rail
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CONTENT Aim Methodology Results Con
clusions Western Europe Policy Conclusions
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Conclusions
General interpretation

• Road transport costs are predominant, esp.
  Accidents and Air pollution.
• Rail costs are higher than in Western Europe, due
  to fossil electricity production and diesel
  traction (air pollution costs).
• High range between countries, due to GDP
  differences and due to different traffic and
  exposure levels.
• External costs will increase in the future. Big
  difference between trend and EST.
• Data quality is rather poor High range of
  uncertainty.

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CONTENT Aim Methodology Results Con
clusions Western Europe Policy Conclusions
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Western Europe
Comparison with Western Europe

• Higher share of GDP than in Western Europe14
  compared to 8
• Average costs are lower in CEI-countries, due to
  lower GDP per capita
• Difference in safety performance Accidents costs
  higher in CEI countries
• Road freight transport is more predominant in CEI
  countries
• Road Rail ratio is comparable
• Growth rates are higher in CEI-countries

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CONTENT Aim Methodology Results Con
clusions Western Europe Policy Conclusions
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Policy Conclusions - General I

• No overall picture of transport, but important
  basis for safety and environmental performance.
• Figures can be used for cost benefit analysis
• Safety programmes and polluter pays principle for
  insurance systems.
• Fast introduction of EURO norms and improvement
  of eco-efficiency
• Revitalisation of the railways - Investment
  priorities for rail - Electrification and
  improvement of diesel performance

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Policy Conclusions - General II

• Average costs as a basis for externality pricing
• 3.3 Eurocents per Passenger and Kilometre for
  passenger cars
• 4.4 Eurocents per tonne and kilometre for trucks
  and light duty vehicles.
• However No direct evidence for the level of
  todays prices
• ? Estimation of infrastructure cost coverage
• ? Estimation of congestion costs

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Latest Development
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Contribution to the UNECE - WHO Transport, Health
and Environment Pan-European Programme (THE PEP)

Transnational Project and Workshop Series of
Austria, France, Malta, the Netherlands, Sweden
and Switzerland Transport-Related Health
Effects with a Particular Focus on Children
Towards an Integrated Assessment of their Costs
and Benefits. State of the Art Knowledge,
Methodological Aspects and Policy Directions KEY
FINDINGS AND KEY MESSAGES Budapest, 23 June
2004 4th WHO Ministerial Conference on
Environment and Health The Future for Our
Children
Slide 36
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Outline of Presentation

A) Technical findings

• Air Pollution - France
• Noise - the Netherlands
• Physical Activity (walking cycling) -
  Switzerland
• Psychological and Social Effects - Austria
• Road Traffic Injuries - WHO / Malta
• Climate Change - WHO
• Economic Valuation - Sweden

B) Key messages
Slide 37
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Key Study Findings Air Pollution (I)

• (1) Evidence on negative impacts in children
• Neonatal and post neonatal mortality (1-12 m)
• Asthma attacks
• Respiratory symptoms in healthy children
• Hospitalisation for respiratory disease and for
  asthma
• Childhood cancer
• Preterm birth

Slide 38
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Key Study Findings Air Pollution (II)
(2) Children are more susceptible than adults,
among others because of their immature
metabolism and their physiology. (3) Black
Smoke and PM 2.5 seem as better indicator of
exposure to traffic emissions than PM10. (4)
Further assessments of exposure-response function
for child-specific health outcomes
needed. (5) Intervention studies show health
benefit in decreasing air pollutant emission
either by speed reduction, traffic
restriction, fuel and motor quality improvement
e.g. Decrease of 5 µg/m3 PM10 in 19 European
cities gt would prevent 5,547 deaths
Slide 39
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Key Study Findings Noise (I)
(1) 30 of EU population exposed to noise
levels above WHO-guideline-values (2) At these
levels substantial number of people annoyed
and sleep disturbed (3) Transport noise
expected to increase, extra measures needed
Slide 40
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Key Study Findings Noise (II)

• (4) Evidence on health impacts in children
• Annoyance
• Learning increase aircraft noise has negative
  impacts on memory and reading (up to 6 months of
  impairments in reading age)
• Hidden effects during sleep may increase
  cardiovascular risk
• Intervention helps minus 5-7 dB(A) outdoor
  background noise evidence for health benefits

Slide 41
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Key Study Findings Physical Activity (I)

• (1) Impacts of Physical (In)Activity
• Physical activity of children is decreasing
  partly due to substitution of walkingcycling
  by car trips.
• Overweight for children has increased.
• CH 37 physical inactives gt Direct treatment
  costs amount 1.1 billion EUR per year.
• Clear evidence on health benefits due to
  physical activity.

Slide 42
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Key Study Findings Physical Activity (II)
(2) Positive Impacts of Physical Activity
ñ
Life
expectancy
ò
Cardiovascular disease
ò
Diabetes II
ò
Obesity
ò
Colon cancer
ò
Breast cancer
ò
(
Prostate cancer
)
ò
(
Pancreatic cancer
)
ò
Osteoporosis
ò
Symptomatic gallstone disease
ò
Depression
ñ
Well
being
ñ
Stress
tolerance
ñ
Independence in old age
Slide 43
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Key Study Findings Physical Activity (III)
Slide 44
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Key Study Findings Road Traffic Injuries (I)

• (1) Facts
• 127,000 deaths and 2.4 million injured people per
  year in WHO European Region leading cause of
  death for those aged 5-29 y.
• ? children aged 0-14 6,500 deaths/year
  ? young people aged 15 -29
  37,000 deaths/year
• Estimated costs (EU 15) 180 billion /year
• More than 65 crashes occur in urban areas
• One out of three deaths involves a pedestrian or
  a cyclist
• (2) Implications
• Improve speed control, especially in urban areas
• Focus on children, young people, cyclists and
  pedestrians
• Take into account human body vulnerability to
  kinetic energy and possibility for mistakes by
  road users

Slide 45
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There is a large safety gap between different
parts of Europe countries reporting the lowest
and highest mortality differ by up to 11 times
Standardized mortality rates from RTIs per
100,000 population in the WHO European Region.
2002 last available year
Source WHO Health for All databse, Jan 2004
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Key Study Findings Psychological and Social
Effects (I)
(1) Psychological effects and health effects by
walking to school instead of being driven

• Lower score in depression
• Lower score in aggression/hostility
• Less psychosomatic symptoms
• Lower score in anxiety

Slide 47
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Key Study Findings Psychological and Social
Effects (II)
(2) Fear of road traffic injuries acts as a
barrier which prevents children from
walking/cycling (3) Social impact High traffic
density in human settlements is hindering
the development of independence and social
contacts of children. (4) Mental and social
conditions can modify the impacts of
environmental stressors on health.
Slide 48
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Key Study Findings Climate Change

• Transport related greenhouse gas emissions
  contribute to at least one third of the overall
  emissions
• Although GHG are produced locally the effects are
  global by affecting the climate system
• WHO estimated that 150.000 deaths were caused by
  climate change in 2000
• It is estimated that these effects will be
  doubling if no measures are taken
• In Europe, it was observed that
• Heat-wave caused more than 25,000 death in 2003
• 6-14 of increase of no. of cases of salmonella
  with 1C increase of temperature
• Changes of the seasonality of allergic disorders
• Changes of ranges of vector borne diseases

Impact on Health
Source WHO-Europe, 2004 World Health Report
2002.
Slide 49
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Key Study Findings HIA and Economic Valuation (I)
Lessons learned (1) Integrated Health impact
assessments and cost-benefit analyses can
provide relevant information for policy
makers on the effects of interventions. Depending
on policy questions and level, different
methodologies available. (2) Economic
analyses and tools like CBAs do not take into
account all transport-related health impacts,
nor do they include children specific
costs. (3) Monetarization of health impacts needs
further development.
Slide 50
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Key Study Findings HIA and Economic Valuation
(II)
(4) Need to assess and monetize the transport
related environmental health effects in
particular on children and incorporate them
into economic valuations and tools e.g. cost
benefit analysis of infrastructure and
internalization strategies. (5) CBA of
cycling infrastructure in Norway health benefits
of physical activity, benefits of investing
in cycle networks significantly outweigh
the costs ! (6) The Willingness To Pay (WTP) is a
suitable methodology. OECD workshop
results WTP of parents for their children
possibly twice as high as for themselves. If no
children related WTP values are available
then at least take the adult values. (7) Areas of
further investigation monetarization e.g.
valuation of psychological and social
effects and physical activity.
Slide 51
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Key Messages (I)

• (1) Children are vulnerable and their needs
  should be taken first.
• Children are vulnerable from a physiological,
  psychological and economic point of view.
• Experience of a healthy environment as a child
  will influence future choices towards a healthy
  environment as an adult.
• Investments to improve health and environmental
  conditions for children benefit the entire
  society and avoid future costs.
• Childrens rights to express views freely should
  be given due weight in accordance with age and
  maturity (UN Convention on the Rights of the
  Child (1989) specifically Article 12).

Slide 52
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Key Messages (II)
(2) There is an increasing dependence on private
car use leading to severe restrictions of
choice for childrens mobility and physical
activity. (3) Current transport patterns and
future trends pose a significant threat to
childrens health and development road
traffic injuries, air pollution, greenhouse gas
emissions, noise, and restricted
opportunities for safe walking, cycling and
other outdoor activities. (4) Healthy mobility
makes a difference A minimum of 30 minutes
per day of physical activity - e.g. by human
powered mobility like walking and cycling
significantly reduces important disease risks
such as cardiovascular disease, hypertension,
Type II diabetes.
Slide 53
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Key Messages (III)

• (5) Policy makers should focus on implementing
  measures in transport, which are highly
  beneficial to children, as they would also
  bring benefit to everyone.
• Integrate child-friendly mobility vision into
  transport policies prioritise speed reduction
  and control, more safe space for walking and
  cycling, easy access to public transport,
  promotion of school mobility management.
• Awareness raising education and communication
  strategies on child friendly mobility, in
  particular highlighting the benefits of human
  powered mobility.

Slide 54
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Key Messages (IV)

• (cont.)
• Infrastructure child-friendly and safe
  infrastructure, using childrens needs to
  reform design-standards and planning guidelines
  for infrastructure, transport codes, and zoning
  regulations.
• Technical measures particle filters or other
  appropriate environmental technologies in cars,
  safety devices such as child car safety seats,
  seat belt use, helmet use.
• Research programmes should focus more on
  children specific concerns.

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Key Messages (V)

• (6) Childrens health can also be promoted by
  general policy using economic instruments and
  normative interventions.
• Mobility management in communities including,
  car traffic restrictions and prioritization of
  walking, cycling and public transport.
• Enforce speed limits and speed control, enforce
  maximum permissible blood alcohol levels for
  drivers of less than 0.05 g/dl.
• Reduce traffic emissions e.g. improving vehicle
  technologies and further tighten emission and
  safety standards for vehicles.
• Use economic instruments and incentives for
  introducing energy-saving technologies e.g.
  alternative fuels, zero emission vehicles
• Fair and efficient road pricing, parking fee
  schemes.

Slide 56
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Key Messages (VI)

• (7) Promote and improve assessment and economic
  valuation of the transport related health
  impacts on children.
• Take into account negative health effects of
  transport such as exhaust emissions injuries
  and noise, as well as the positive health
  effects of walking and cycling.
• Develop and conduct assessments of
  transport-related health effects e.g. Children
  Impact Assessments (CIA)
• Integrate transport-related health impacts on
  children and their costs and benefits into
  policy instruments e.g. cost- benefit-analysis
  of infrastructure, and internalisation of the
  external costs of transport.

Slide 57
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Key Messages (VII)

• (8) Redesign human settlements and infrastructure
  and integrate childrens needs in planning to
  provide more space for physical, mental and
  social development of children.
• (9) Incorporating childrens needs requires a
  shared responsibility between families, the
  education, health, environment, transport and
  urban planning sectors, the private sector,
  industry and civil society.
• Intensify pan-European co-operations such as the
  WHO- CEHAPE, WHO/UNECE THE PEP, the
  EU-Environment Health Strategy

Slide 58
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Key Messages (VIII)

• (10) There is a world to win Start to act now!!
• Share best practices and assessments, establish
  new partnerships and co-operation among
  sectors.
• Develop and implement child-friendly mobility
  plans and monitor their achievements.
• Design a package of integrative measures with
  a timeframe for implementation. These could
  start with pilot projects.
• Start assessments of transport related health
  effects which include costs and benefits with a
  particular focus on children.

Slide 59
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Thank you for your attention!
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Thank You!
Slide 61