Articles by Alan Durning

Who’s getting PAYD?

The Northwest's guru on pay-as-you-drive (PAYD) auto insurance and related transportation pricing innovations is Todd Litman of the Victoria Tranport Policy Institute. He provides a useful summary of who's doing PAYD in his newsletter, which I'll simply insert below the fold. The growth of PAYD programs is very encouraging, because PAYD is among the most powerful incentives for sound transportation and land-use patterns. There are rumors that a Cascadia locale could be the next place to host a PAYD insurance offering -- more on that, if it comes to fruition.

Feebates, not fuel taxes, are key

Thomas Friedman's usually pitch-perfect commentary on energy and security hit some high notes Sunday, but it also went off key twice, in disappointing ways.

First, the sweetest passage from his New York Times column:

By doing nothing to lower U.S. oil consumption, we are financing both sides in the war on terrorism and strengthening the worst governments in the world. That is, we are financing the U.S. military with our tax dollars and we are financing the jihadists--and the Saudi, Sudanese and Iranian mosques and charities that support them--through our gasoline purchases. The oil boom is also entrenching the autocrats in Russia and Venezuela....Finally, by doing nothing to reduce U.S. oil consumption we are only hastening the climate change crisis.

Now, the ear splitters:

Clean-car dominoes

Clean-car dominoes keep falling. This week, it's Canada, with Oregon next.

On Wednesday, word came that the Canadian government and the big automakers have signed an agreement to reduce emissions of greenhouse gases from new vehicles. The previously announced target of a 25 percent reduction in new-car emissions by 2010 has apparently been nixed. In its place is a specified number of tons of gases that automakers must keep out of the atmosphere through improvements to new cars, as MacLeans reports.

The number of tons, according to one report, is roughly equal to the old 25-percent target. Unfortunately, that's a hard claim to assess, because the details of the agreement are still secret.

The 25-percent target has always been important, and ambitious--more ambitious than the 30-percent emissions reduction written into California's clean-car standards because the latter standard has a deadline of 2016. The year 2010 is just around the corner in a gigantic industry that takes many months to usher new technologies into mass production. So even if this agreement turns out to be watered down, it's likely that it at least matches the California standard.

Feebates in the U.K.

Just like Canada, the United Kingdom is seriously considering vehicle feebates, reports the invaluable newsletter Green Budget News.

To recap, feebates (sometimes called "freebates") are a great way to harness market forces to encourage energy efficiency and discourage pollution. The article above gives a good explanation of how they'd work:

The proposal would require owners of more polluting vehicles to pay an extra levy, while drivers of environmentally friendly cars would reap the benefits and receive a grant as a reward for buying fuel-efficient vehicles.

So people who buy gas guzzlers pay a fee that's refunded to people who buy gas-sippers--creating a powerful incentive for continual improvements to automobile efficiency.

One of the great features of feebates is that they pay for themselves -- taxpayers don't even get involved.  In fact, the UK proposal is to use feebates to replace the existing vehicle excise duty, which apparently has had little effect on consumers' vehicle choices.

And by the way -- I can't recommend Green Budget News enough. Almost every article holds some fragmentary insight into tax shifting and market oriented sustainability. And while it's focused on the European Union, it's chock full of ideas that could be adopted in this part of the world as well. The current edition of the newsletter, which is published by Green Budget Germany, also contains informative updates on congestion pricing in Scotland and Austria and vehicle, pollution, and energy taxes in Denmark.