Transportation System Management
The basis for the calculation of cost-effectiveness for one possible parking management program is presented here. The program considered would address the CO2 emissions of some of the 48 million people in U.S. metropolitan areas who drive to work alone (Pisarski, 1987). Currently, three-quarters of them, or 36 million, are provided with free parking by their employers (Pucher, 1988). Under this parking management program, 25 percent, or 9 million, of these spaces would be physically eliminated by the year 1995. Parking fees or surcharges would be imposed on the remaining 75 percent, or 27 million spaces, set at a level designed to reduce the proportion of persons driving alone by 15 percent, from 65 percent (Pisarski, 1987) to 50 percent by 1995.
As calculated below, this proposal would produce an annual CO2 reduction of 49 megatons (Mt) at a cost of between -$4.75 and $2.59 billion.1 Cost-effectiveness thus ranges from -$97/t CO2 to $53/t CO2, for an average value of -$22/t CO2.
Calculation of CO2 Emission Reductions
The first step is to calculate the annual CO2 emissions attributable to different commuter transportation modes (see Table F.1). Calculations are performed for a 10-mile commuting trip, which is the national average (Pisarski, 1987).
The second step is to calculate the way in which solo commuters will redistribute themselves among alternative transportation modes in response to parking restrictions. This analysis assumes that the percentage of those who use bus, rail, carpool, or vanpool will be proportional to the current "mode split" (excluding pedestrians and those who work at home). Where
TABLE F.1 Carbon Dioxide Emissions by Commuting Mode (tons/year)
parking spaces are eliminated, it is assumed that none of the 9 million displaced solo commuters continue to drive alone, and all are divided among the four remaining modes. Where parking spaces are priced to reduce the solo driver mode share to 50 percent, the shares for the remaining modes are proportional to those calculated for elimination of parking spaces. (To account for the remaining solo drivers, the other mode shares add up to 50 percent, rather than 100 percent, of all commuters.) The mode splits for displaced drivers are presented in Table F.2.
These mode splits are then applied to the 9 million solo drivers affected by the parking elimination component and the 27 million solo drivers affected by the parking management component. As shown in Table F.3, the combination of these two measures would produce annual emission reductions of 49 Mt of CO2.
Calculation of Cost-Effectiveness
A parking demand management program of the type described in this appendix would involve several types of costs and savings:
• employees' out-of-pocket costs or savings from the use of alternative transportation modes (a figure that includes fuel savings);
• employers' out-of-pocket operational costs or savings from parking management and provision of transportation alternatives;
TABLE F.2 Calculation of Mode Shares for Multiple Occupancy Vehicle Modes When Parking Spaces Are Eliminated or Restricted
TABLE F.3 Carbon Dioxide Emission Reductions from Parking Management Program
• employers' capital savings from the avoided costs of constructing parking spaces; and
• monetized costs or savings from changes in the lengths of commuting trips.
The first categoryemployees' out-of-pocket costsis calculated by considering costs such as variable automobile operating expenses, bus and train fares, and vanpool fees. The second categoryemployers' operational costsinvolves increased costs for running carpool and vanpool programs, offset by savings from avoiding the annual operating and maintenance costs of providing parking spaces for bus, rail, and some ridesharing commuters. The third categoryemployers' capital savingsrepresents the avoided costs of constructing parking spaces at an average investment of $3000 per space. Finally, changes in the length of commuting trips cause productivity losses or gains that can be monetized.
TABLE F.4 Combined Employer/Employee Out-of-Pocket Costs/Savings of Alternative Commuting Modes per Daily Round Trip Commute (1987 dollars)
TABLE F.5 Out-of-Pocket Employee and Employer Savings from Switching from Solo Driving to Other Commuting Modes
The first two categories of costs are elaborated in Table F.4. Once the cost per commuter trip for each mode is calculated, the total out-of-pocket costs/savings of a parking management program are calculated by multiplying the number of former solo commuters using each alternative mode by the cost differential. The results are presented in Table F.5. Savings to both workers and employers exceed costs, resulting in an overall program savings of -$12 million.
In addition to these savings, employers save money by avoiding the capital costs of providing parking. Constructing a parking space costs between $1,000 and $15,000 (Institute of Transportation Engineers, 1989), with one survey finding an average cost for added spaces of $3,920 (Wegmann, 1988). Even if a space has already been constructed, employers can realize savings from eliminating the use of the space for employee parking and using the space for paid, commercial parking or other purposes. This parking management program would eliminate the need for 16.9 million parking spaces, 9 million directly eliminated and 7.9 million freed when solo commuters shift to less parking-intensive modes. If only 10 percent (or 1.69 million parking spaces) are spaces that would otherwise have been built at an average construction cost of $3000, the total employer capital cost savings is $5.1 billion.
Finally, the program will change the length of commuting trips in two ways. First, traffic congestion will be reduced because 22.5 million solo commuting cars will be replaced by 6.7 million buses, carpools, vanpools,
TABLE F.6 Changes in Annual Commuting Time for Different Modes Relative to Base-Case Solo Commuting Without Parking Management
and solo commuters. With one-third fewer commuter vehicles on the road during peak hours (there are currently 48 million solo commuters in metropolitan areas of the United States), traffic congestion will be reduced and travel speeds increased for all highway modes (solo drivers, carpools, vanpools, buses). This analysis considers two scenarios, one in which travel speed is increased by 5 percent and one in which travel speed is increased by 20 percent.
Trip lengths will also change because shifting to modes such as buses and vanpools will increase commuting times relative to solo automobile travel. Data presented in Pisarski (1987) indicate that commuting by bus and rail is slower than commuting by automobile. Table F.6 calculates the relative changes in annual commuting time accounting for both of these factors. Table F.7 then converts these figures into total commuting time delays/gains and monetizes the resulting productivity changes at values ranging from $5 to $10 per hour. These figures are consistent with values of $5 to
TABLE F.7 Monetized Value of Changes in Trip Lengths Due to Parking Management Program Relative to Base-Case Solo Commuting
$7 per hour used by the Federal Highway Administration and transportation researchers to value time spent in traffic delays (U.S. General Accounting Office, 1989; Wegmann, 1989). (Only the upper-bound and lower-bound cases are presented in Table F.7; the lower bound assumes a 20 percent increase in highway speed and values delays at $5 per hour, while the upper bound assumes a 5 percent increase in highway speed and values delays at $10 per hour.)
Thus the total cost of this parking management program is as follows:
The total cost thus ranges from -$4.75 billion to $2.59 billion.
1. Throughout this report, tons (t) are metric; 1 Mt = 1 megaton = 1 million tons.
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