Transport Strategies for Net-Zero Systems by Design

5. Transformational change #3: From eroded to attractive sustainable transport modes

Abstract

This chapter focuses on the dynamics underlying the erosion of shared and active modes of transport, including public transport. It then discusses policies to foster the development of multimodal networks to reverse such erosion, and thus reduce car dependency, lower emissions, improve accessibility and increase people’s well-being.

This chapter focuses on the erosion of shared and active modes of transport, including public transport. This erosion is, to a great extent, a result of the induced demand and urban sprawl dynamics discussed in Chapters 3 and 4. The chapter also discusses policies with the potential to accelerate the development of multimodal networks to reverse such erosion, and thus reduce car dependency, lower emissions and improve accessibility.

5.1. Why sustainable transport modes are not attractive to people

Public transport’s quality of service - and thus its attractiveness – largely depends on the frequency, fare and the reliability of service. The enabling conditions for public transport to provide a good service include high interconnectivity between public transport modes and other modes such as walking, cycling or the use of micro-mobility (ITF, 2014[1]), and a minimum density of people and places of interest.1

As explained in Chapters 3 and 4, investments in road expansion capacity and the priority given to private motorised vehicles in terms of public space allocation has resulted in induced demand and urban sprawl. Such prioritisation has also led to the erosion of public transport. On the one hand, the attractiveness of driving a car increases vis-à-vis other modes as congestion decreases, potentially reducing public transport ridership (Figure 5.1). On the other hand, the prioritisation of investments in road infrastructure to accommodate private vehicles may result in lower investments in public transportation infrastructure, and thus a reduced quality of service and attractiveness, further reducing ridership (not shown in Figure 5.1) (Sánchez-Atondo et al., 2020[2]; Taylor and Fink, 2013[3]). Indeed, while a number of governments earmark funding for public transportation, budgets dedicated to roads are often significantly higher than those dedicated to public transport (Public Transport Users Association Victoria Australia, 2009[4]; Leahy, 2020[5]).

The vicious cycle described in Figure 5.1 limits the opportunities to transition to clean, efficient and safe public transport networks, and increases the attractiveness of driving a car vis-à-vis public transport, thus exacerbating climate mitigation, pollution, road safety and equity2 challenges. As public transport ridership drops, public transport revenue decreases and the public transport budget deficit increases, potentially pushing authorities to increase fares (not shown in Figure 5.1). When public transportation fares increase, the attractiveness of driving a car also increases, as it becomes relatively less expensive. Often, however, public transportation fare increases are politically difficult to implement. Thus, instead of increased fares, deficits may result in lower investments in the public transport network and service, resulting in poor infrastructure quality, and routes and frequency cuts, further eroding the quality of service of public transport and its attractiveness3 (Sterman, 2000[6]) (Figure 5.1).

Figure 5.1. The erosion of public transport and the privilege given to cars

Notes: Arrows with a “+” mean that both variables move in the same direction (when one increases, the other increases and vice versa). Arrows with a “–” mean that the variables move in opposite directions (when one increases, the other decreases and vice versa). The two lines on the arrow denote a delay. The figure can be read as follows (purple arrows): As the attractiveness of driving a car increases (thanks to investments in road/highway capacity expansion), the number of trips per day by car increases (because of more people choosing to drive a car), which reduces public transport ridership. As public transport ridership shrinks, public transport revenue shrinks as well, which may increase public transport deficit. The higher the deficit, the less investments are possible to ensure a good quality of service (not shown in figure), and thus the quality of public transport service decreases. As the quality of transport service decreases, the attractiveness of driving a car increases, which increases the number of people choosing cars rather than public transport, etc.

Source: Adapted from Sterman (2000[6]).

The attractiveness of public transport becomes further eroded in the context of high sprawl and suburbanisation, for which investments in road capacity expansion is an important enabler (see Figure 5.2). This has a number of implications. First, with sprawl, the average length of trips increases, resulting in higher emissions. Second, low-density expansion exacerbates the challenges of providing quality public transport services in terms of proximity to stations/stops across the entire built-up area and commuting zone. Third, lower density of demand hinders the financial viability of expanding services, increasing the share of places not reachable by public transport. Figure 5.2 illustrates this dynamic: as the size of the region accessible by road/highway increases, density tends to decrease (not shown in figure) and the number of places conveniently accessible by public transport decrease (Figure 5.2), increasing the attractiveness of driving a car and further eroding the quality of public transport service.

Figure 5.2. Further erosion of public transport due to urban sprawl

Notes: Arrows with a “+” mean that both variables move in the same direction (when one increases, the other increases and vice versa). Arrows with a “–” mean that the variables move in opposite directions (when one increases, the other decreases and vice versa). The two lines on the arrow denote a delay. The figure can be read as follows (orange arrows): as the size of the region accessible by road/highway increases, density tends to decrease (not shown in figure) and the number of places conveniently accessible by public transport decrease. Thus, as the region expands, places may be less well deserved by public transport, reducing the attractiveness of public transport and increasing the attractiveness of its alternative: the car.

Source: Adapted from Sterman (2000[6]).

This is, indeed, what can be observed in most regions: cars perform better than public transport in terms of travel time and access to places of interests4 (ITF, 2019[7]). For example, the ITF (2019[7]; forthcoming[8]) finds that, despite congestion, in European and Latin American cities (with the exception of London), driving a car provides greater access compared to public transport (Figure 5.3), and is sometimes the only option available. A study by Liao et al. (2020[9]) compared travel times between a car and public transportation in São Paulo, Brazil; Stockholm, Sweden; Sydney, Australia; and Amsterdam, Netherlands and found that public transportation takes on average 1.4-2.6 times more than driving a car. The study used real-world data to estimate travel time by both car and public transport, and compared their performance by travel distance and time of day (Liao et al., 2020[9]). The study also finds that cars allow those living in the commuting zone (see Annex A) greater access to goods and services, e.g. restaurants, shops, schools. Three out of ten high school students living in the commuting areas of the 120 European cities studied depend on cars to get to school, and walking is not a viable option for 40% of primary school students and 65% of high schoolers. Within cities, where density is higher, 3 out of 4 students are able to walk and 19 out of 20 are able to bike to school within 15 minutes or less. In cities in developing countries, the gap between access by car and public transport tends to be even wider (ITF, 2019[7]; forthcoming[8]).

Figure 5.3. Access of private cars vs. other modes of transport: Evidence from selected cities*

* Data reflect the territory that corresponds to cities (see Annex) rather than only inner cities. Cities consist of a high-density cluster of contiguous grid cells of 1 km² with a density of at least 1 500 inhabitants per km² (referred to as an urban centre) and any local unit with >50% of its population living in the urban centre (Dijkstra, Poelman and Paolo, 2019[10]).

Note: The number of people accessible in 30 minutes is used in this figure as a proxy for accessibility. “m” stands for million.

Sources: ITF (2019[7]; forthcoming[8]).

Public transport is not the only sustainable transport mode which attractiveness is compromised due to the car-dependent nature of urban and transport systems. Figure 5.4 illustrates the erosion of active and shared modes (including micro‑mobility): as investments in road infrastructure for car use increase and road/highway capacity expands, the share of space allocated to active modes decreases, which reduces the attractiveness of active modes, as it may not be safe, or pleasant, to walk, ride a bike or an eScooter.

In addition to the amount of space allocated, the continuity of infrastructure is fundamental. While roads for car use form a connected and continuous network, walking and biking infrastructure in most cities is discontinuous, rendering them unsafe and, thus, unattractive. Furthermore, with the majority of road space allocated to car use, people walking, cycling and using micro‑mobility5 must “compete” for the same small share of space, often also shared with public transport and taxis, e.g. bus and taxi lanes shared with bikes or bike lanes in narrow sidewalks. The safety and convenience of active modes is, as a result, further eroded.

Figure 5.4. The erosion of active, shared and micro-mobility modes of transport

Notes: Arrows with a “+” mean that both variables move in the same direction (when one increases, the other increases and vice versa). Arrows with a “–” mean that the variables move in opposite directions (when one increases, the other decreases and vice versa). The two lines on the arrow denote a delay. The figure can be read as follows (blue and green arrows): as traffic volume/congestion (in red) increases as a result of induced demand (B1, B2 and B3) and urban sprawl (R1 and B4), and as the share of public space for accommodating cars at the detriment of other modes increases, active modes become less attractive (blue arrows). The less attractive these modes are, the more people may choose to drive a car (given that the attractiveness of public transport is also eroded), driving traffic volume and congestion up.

Source: Adapted from Sterman (2000[6]).

As for public transport, urban sprawl following a single-use logic contributes to the erosion of active modes and micro-mobility (Figure 5.5). While active modes and micro-mobility are particularly suited for short- and medium‑length trips, respectively, urban sprawl increases the average distance to places of interests, reducing the number of places conveniently accessible by active modes, and thus their attractiveness and the number of people that choose them.

Figure 5.5. Further erosion of active and micro-mobility modes of transport due to urban sprawl

Notes: Arrows with a “+” mean that both variables move in the same direction (when one increases, the other increases and vice versa). Arrows with a “–” mean that the variables move in opposite directions (when one increases, the other decreases and vice versa). The two lines on the arrow denote a delay. The figure can be read as follows (dark green arrows): as people move further away to single-use areas (encouraged by the dynamics R1 and B4), the average distance to places of interest increases, which reduces the number of places conveniently accessible by walking or cycling. As the number of places accessible decreases, the attractiveness of active modes also decreases, and so thus the number of people that choose them.

Source: Adapted from Sterman (2000[6]).

The next section deeps dive on ways forward to reverse the dynamics illustrated in Figures 5.1-5.5 as to increase the attractiveness of active and shared modes, and thus the number of people that choose these modes for the bulk of their trips.

5.2. How to increase the attractiveness of sustainable transport via the development of multimodal networks

Climate strategies have the potential to reverse the systematic erosion of sustainable modes of transport described above and foster the development of multimodal networks of sustainable transport options. On the one hand, this requires important efforts for increasing the quality and convenience of public transport, which needs to be the backbone of transport systems (and shared mobility). This contrasts with strategies based on making public transport cheap or free for everyone, which can hinder investment, and thus limit possibilities for improving the quality of services (UITP, 2020[11]; ITF, 2017[12]). As will be discussed later, the possibility of subsidising services must not be excluded, but targeted subsidies (based on careful analysis of the socio-economic conditions of beneficiaries) should be the preferred option. There can also be grounds for cross-subsidising services (e.g. in lower density areas) due to environmental and social objectives (Mattioli et al., 2020[13]).

In addition, there is enormous potential to develop multimodal networks of sustainable alternatives if public transport is integrated with other shared mobility services. New technologies have provided an opportunity to upscale these services (e.g. by facilitating on-demand services). But it is necessary to provide wider scope and support for the development of innovative business models and vehicles (e.g. cargo bikes or new forms of micro-mobility) and to implement policies that can effectively encourage shared mobility to become the norm.

This section describes the type of policies that, if they are at the core of climate strategies, can unlock significant emissions reduction opportunities while improving people’s well-being through the development of multimodal and integrated networks of sustainable modes of transport. Section 5.2.1 focuses on how to increase the attractiveness, and thus use, of public transport, while Section 5.2.2 focuses on active modes and micro-mobility.

5.2.1. Making public transport an attractive option

This section focuses on how governments can increase the attractiveness of public transport so that it is, along with other shared modes, one of the modes of transport that most people choose for their longer trips. It introduces the importance of regulatory power capacity, then discusses the role of funding. It goes on to focus on how the existing capacity of public transport systems can be used the most efficiently.

Regulatory power capacity

The first condition for enhancing the attractiveness of public transport requires that authorities have adequate regulatory power to oversee the sector. This includes setting quality standards for services (whether provided by public or private actors) and planning for the network of routes and services to ensure that public transport and other services are well co-ordinated and serve origin-destination needs. Importantly, having the staff with the right skills to carry out regulation is indispensable. As discussed in Chapter 4, metropolitan transport authorities are good institutions for carrying out this task, since they can oversee the public transport system (and its connections with other modes) in the light of a metropolitan-wide vision.

Where this is not the case and public transport is deregulated, authorities need to work towards setting the right governance and legal frameworks for regaining such powers. For instance, in places like Santiago, Bogotá and Mexico City, bus rapid transit services have been introduced in a way that not only increases the offer of mass transit, but also helps to renegotiate the public-private equilibrium to advance in re-regulating the bus system.6 This includes by creating new regulatory bodies (OECD, 2015[14]; ITF, 2017[15]). In the United Kingdom, bus services were deregulated in the 1980s except in London, which is nowadays an important reference for having introduced (via its metropolitan transport authority, Transport for London) one of the best tendering processes. In 2016, the Cities and Local Government Devolution Act reintroduced the possibility for cities, towns and counties to decide upon the transport sector regulation again (Jones, 2016[16]) and cities like Manchester are re-regulating the regional bus network (Box 5.1). Importantly, building regulatory capacity within government administrations is also key.

Box 5.1. Re-regulating public transport: The case of the United Kingdom

During the 1980s and 1990s, many governments in both developed and developing countries deregulated public transport services (Sohail, Maunder and Cavill, 2006[17]). Worldwide experience shows that among other problems, deregulation can result in reduced reliability, poor connections, poor driver behaviour on the road to win passengers (bus wars), as well as business models which look to bring in excessive profits, via declining standards (Sohail, Maunder and Cavill, 2006[17]). Another shortcoming can be the absence of services in marginal areas if these are not seen as profitable, which can reduce the accessibility of poorer groups to jobs and other opportunities (Sohail, Maunder and Cavill, 2006[17]). In some contexts, and especially in developing countries, this has also given rise to informal or semi-formal modes of public transport, which even when they sometimes may bring some benefits (e.g. jobs for low-skilled workers), have also generated important costs (e.g. increased traffic congestion, air and noise pollution, and traffic accidents) (Cervero and Golub, 2007[18]). Overall, treating public transport as a deregulated private service has shown to lead to a number of shortcomings for ensuring that services meet the public interest.

The UK case

The transport sector in the United Kingdom was deregulated in the 1980s and privatised across the country with the objective of reinvigorating the bus industry and simultaneously reducing public expenditure (Bayliss, Mattioli and Steinberger, 2020[19]; Phillipson and Gilfillan, 2015[20]). London was an exception: having just reorganised public transport, the city was not yet ready for deregulation (Phillipson and Gilfillan, 2015[20]).

Transport deregulation initially led to lower fares, driven down by the opening of competition. Single operators and agreements between operators, coupled with the removal of public subsidies lead, within a few years, to fare increases, a decline of passenger numbers, followed by a decline in the quality of services (Phillipson and Gilfillan, 2015[20]). This, in turn, further reduced passenger numbers and funding for improving the services, trapping the sector in a vicious cycle.

In London, the public sector kept the possibility to regulate transport. Transport for London (TfL), created in 2000, is the lead agency in the city and is responsible for a majority of the transport network as well as strategic planning, transport policy planning, fare setting, and infrastructure and service planning (Kumar and Agarwal, 2013[21]).

Within TfL, London Bus Services Limited manages bus services by planning routes and determining the conditions for service provision. Contracts are granted to private bus operators fulfilling such conditions via public tendering. It is estimated that 15-20% of the total bus service is retendered every year (TfL, 2015[22]). In 2001, London Bus Services introduced quality incentive contracts,* a tendering and contracting system that incentives bus operators to improve service quality (TfL, 2015[22]). This structure provides incentives, as operators can receive bonuses based on their wait times and punctuality in comparison to the standard, or deductions for mileage not operated (ITF, 2018[23]). Between 2001 and 2015, bus ridership grew by 70% (TfL, 2015[22]). A number of countries around the world are considering similar changes to their tendering processes (TfL, 2015[22]).

At the national level, the Cities and Local Government Devolution Act 2016 allowed cities, towns and counties to decide upon the transport sector regulation again (Jones, 2016[16]). In March 2021, the Greater Manchester Combined Authority (GMCA) voted in favour of re-regulating the regional bus network after a public opinion poll found that 83% of respondents were in favour of it (King, 2021[24]). Manchester will implement a London-style franchising system, following the recommendation from Transport for Greater Manchester (BBC, 2021[25]). Transport for Greater Manchester will now have local control of buses on behalf of the GMCA and the Greater Manchester Mayor. The changes will allow the GMCA to set standards, price caps, fares, timetables and routes instead of private companies (BBC, 2021[25]; GMCA, 2021[26]). Moreover, the GMCA will be able to co-ordinate and invest in the bus network and there will be integrated ticketing across the network of buses, trains and trams (BBC, 2021[25]; GMCA, 2021[26]).

* Unlike the net cost contracts or the gross cost contracts which were implemented prior to 2000, the quality incentive contracts include minimum performance standards (ITF, 2018[23]). Minimum performance standards are indicators that measure the performance of the operator (ITF, 2018[23]). The operator’s annual reliability performance is compared to the minimum performance standards to calculate the reliability performance payment (ITF, 2018[23]). Measurements differ between high- and low-frequency routes and are based on the area type, journey time and congestion level (ITF, 2018[23]).

Improving financial capacity for increasing quality

Free public transport or very low public transport prices are often seen as a way of incentivising a modal shift from cars to public transport. Experience in cities that have tested free public transport shows, however, that while generating some modal shift from cars to public transport, the larger effect is an undesired modal shift away from walking and cycling (ITF, 2017[15]). Proost (2018[27]) highlights that for every new 100 passengers attracted by low public transport prices, only 15‑35 are former car users.

Moreover, improvements in the quality of public transport have higher demand elasticity than public transport price changes. Analysis of underground rail networks across the globe shows that on average, a 10% reduction in fare levels will result in a 3% increase in patronage. In contrast, demand would increase by more than 5% due to a 10% increase in the capacity of a fixed network (UITP, 2014[28]).

By causing large deficits and reducing the scope to invest in public transport networks, low public transport prices are more problematic for attracting car users than higher public transport prices accompanied by investment. In other words, a strategy that aims at improving the competitiveness of public transport based on low prices reinforces the dynamics of low fares, low revenue, low investment and low quality illustrated in Figure 5.1. The fact that the cost of car use is often too low (i.e. not reflecting its negative social impact) contributes to “second-best pricing” solutions for public transport, i.e. public transport prices being set at even lower levels with the rationale of making them more competitive (ITF, 2018[29]).

An alternative strategy to move public transport systems away from this pervasive cycle is needed more than ever, as public transport has been hard hit financially due to the COVID-19 pandemic. In most cases, allowing for social distancing has meant providing a lot more capacity than would normally be required for the current level of ridership. In Milan, for instance, public transport services during lock‑down ran at 75% of capacity while having only 5% of pre-COVID ridership (UITP, 2020[30]). By the end of 2020, the expected loss of revenue from fares in European public transport systems, for instance, was around EUR 40 billion (UITP, 2020[30]).

Shifting away from generalised subsidies and flat rates and towards differentiated rates with targeted subsidies7 (see Box 5.2) can help strike a better balance between affordability and the financial sustainability of quality services. This will help to increase fare-box revenues and the capacity to invest in public transport networks. Flat fares (as opposed to distance-based fares, for instance) are used in many places, since distance-based fares tend to be seen as unfair, e.g. for low-income residents in the peripheries who travel longer distances. However, flat fares are not cost-effective and result in subsidising and incentivising sprawl (ITF, 2018[29]). Combining distance-based rates with subsidies targeted at lower income residents can help to make people’s decisions more sensitive to the distance between a given location and the rest of the city while at the same time addressing equity concerns (ITF, 2017[15]).8

Box 5.2. Targeted subsidies for public transport

Implementing targeted subsidies (as opposed to generalised ones) is one way of striking a better balance between affordability and financial sustainability. Moreover, technological improvements such as smart cards and improved data management tools allow improving methodologies for targeting vulnerable users. Granting subsidies to groups like the elderly or students results in inclusion and exclusion errors, since there is a frequent mismatch between these categories and vulnerable groups (ITF, 2017[15]).

Instead, schemes targeting users by using affordability data will result in better outcomes from expenditure on subsidies (ITF, 2017[15]). The case of Bogotá, Colombia, is a good example. A targeted subsidy scheme for the integrated public bus system was introduced in 2014. The scheme benefited from the introduction of smart cards, which facilitated differentiating public transport fares for beneficiaries. At the same time, identification of the population that was subject to the subsidy was built on the System for Selecting Beneficiaries of Social Spending (SISBEN). SISBEN is a stratification instrument that was already used by the national as well as by local governments for programmes related to subsidies for water and electricity, among other things. The system classifies neighbourhoods and rural areas based on various socio-economic related characteristics of houses and neighbourhoods (Peralta-Quiros and Rodríguez Hernández, 2016[31]).*

* While doing this at the neighbourhood level can still lead to a certain mismatch between affordability and eligibility, these spatial categories reflect better socio‑economic conditions than, for instance, age groups.

Even if improving fare-setting methods, fare-box revenues are often not enough for public transport to provide a high-quality services9 (ITF, 2017[15]), and this was already the case before the health crisis. Importantly, public transport needs to be regarded as a “social […and environmental]” investment (Cervero, 2011[32]), and co-ordinated action between different levels of government will need to concentrate on increasing the budget dedicated to providing better public transport services and wider coverage. An important part of this is to improve the appraisal methodologies that today bias investment towards projects for car use (see Chapter 3 and OECD (2019[33])).

Governments can also pave the way by making investment in public transport central to recovery packages (Box 5.3). As discussed in Chapter 7, public transport investment has a very high impact on jobs. In addition, when looking at capital cost (USD/km) per capacity created (Buckle et al., 2020[34]; IEA, 2020[35]) (persons/hour/direction carried), public transport (as well as infrastructure for active modes) has much lower capital cost per capacity than car infrastructure. The capital cost per capacity of a dual highway or an urban street dedicated entirely to cars ranges between USD 5 000 and USD 10 000 for a dual highway and USD 5 000 and USD 10 000 for an urban street. In comparison, the capital cost per capacity of metro and commuter rail is USD 2 000-5 000 and USD 2 000, respectively. Capital costs per capacity for bus rapid transit and lanes for regular buses is much lower (between USD 200 and USD 250 for bus rapid transit and between USD 300 and USD 500 for regular buses). Capital cost per capacity of bicycle lanes and pedestrian walkways is USD 30 and USD 20, respectively (IEA, 2020[35]).

Box 5.3. Making public transport central in recovery packages

A number of authorities have provided funds for supporting public transport services, which go beyond the logic of simply helping them survive the COVID-19 crisis and its aftermath.

• Finland assigned one-quarter of the EUR 5.5 billion recovery package to the development of railway and tramway infrastructure and the support of public transport operators. The investment is embedded in other plans (supported by housing, land-use and transport agreements) that focus on ensuring accessibility to public transport services of new housing development projects (IISD, 2020[36]).

• In the United Kingdom, the Department for Transport announced a second recovery package (worth GPB 256 million) in support of public transport operators outside London. Funding reflects a vision in which public transport is seen as key to a sustainable recovery, providing a way forward to reduce air pollution, support social equity and provide citizens with an alternative to private vehicle use (IISD, 2020[36]).

• In London, the central government has provided emergency funds to Transport for London (TfL), and negotiations for the upcoming period between the central government and the city are still ongoing. In addition, London authorities have used the current situation to rethink current funding mechanisms and have come up with a number of proposals and strategies that could allow TfL to reduce its reliance on fare-box revenues and enlarge its financial base. Among the options proposed is that London would be allowed to keep GBP 500 million from the vehicle excise duty paid by its residents every year. Another alternative proposed is charging a “boundary” tax to cars that enter the Greater London area (London City Hall, 2020[37]; Thicknesse, 2021[38]).

Overall, rethinking budgets for public transport is needed. As discussed in Chapter 4, metropolitan transport authorities can serve to rethink and improve governance. Establishing these types of authorities can also serve to put in place advantageous frameworks for diversifying and increasing the budgets needed to improve, maintain and expand public transport, making it part of an integrated and sustainable transport network that can fully serve metropolitan areas and their hinterlands. Importantly, such frameworks need to be the result of co-operation and co-ordination between national and subnational governments. The ITF (2018[23]) highlights the following examples:

• In the case of France, a dedicated business tax (versement transport,10 VT) can be levied by municipalities that are part of a metropolitan transport authority, and funds are channelled directly to this institution. In the case of the Paris region, in 2016, the VT constituted 50% of the metropolitan transport authority’s (Ile-de-France Mobilité) total budget. Another 30% came from fare-box revenues, and 20% from municipal and departmental contributions.

• In London, TfL uses land-value capture mechanisms, namely the community infrastructure levy, and planning obligations as tools for raising funds for transport projects. Business rate supplements11 are also applied to raise funds for transport projects that can promote economic development.

• Both TfL and Ile-de-France Mobilités secure some funds from charges on private vehicles. For instance, 50% of driving offences and fines in Île-de-France go directly to Ile-de-France Mobilités. In the case of TfL, funding collected through parking fines, congestion charging and the low‑emission zone, and the new toxicity T-Charge12 are part of TfL’s budget.

Making the best use of existing capacity

Public authorities also need to make the best from existing capacity by managing crowding, which became a particular problem during the pandemic, but has been an important problem of public transport services for decades. When travelling in crowded conditions people have, for instance, a perceived burden that is equal to having a 25% increase in their (in-vehicle) travel time. Thus crowding is an important element behind the inconvenience of public transport (Wardman, 2014[39]).

A number of governments have implemented actions during the COVID-19 pandemic that can serve as good examples for managing crowding in a post-pandemic situation as well. For example, in London, to ensure that staff from the National Health Service Nightingale Hospitals travelled safely, public transport services made use of additional staff to manage passengers without exceeding safe occupancy levels. This type of strategy has been used in other (pre-COVID occasions) to reduce crowding. Some cities also made important use of digital technologies to reduce crowding. For instance, Beijing introduced digital booking solutions and Catalonia rolled out an app that gives occupancy in real time (Lozzi et al., 2020[40]). In addition, the need for social distancing also led to rethinking supply in different services and routes. For instance, in Hamburg, part of the strategy to reduce crowding was based on rebalancing services provided in high-demand and low‑demand routes.

Differentiating public transport pricing and frequencies during peak and non-peak hours can also be important for better spreading users throughout the day13 and reducing crowding. Combining this with targeted subsidies, as explained above, can help deal with potential equity concerns as well.

At the same time, one of the most important lessons learnt by the need for social distancing is that active and micro-mobility modes can play a key role in easing the pressures on public transport. A number of authorities have increasingly acknowledged the importance of improving conditions for walking, cycling and micro-mobility. In addition to many other benefits (e.g. physical and mental health, potential public space liberated, increased accessibility, etc.), these modes could carry a number of shorter distance trips, leaving public transport with a more manageable demand while also avoiding car use. A number of countries introduced incentives for bicycle purchase (e.g. a grant of up to EUR 500 for bicycle and e-bicycle purchases in Italy), as well as direct provision of bicycles (e.g. for students in Amsterdam) (Lozzi et al., 2020[40]). This is in addition to the roll out of dedicated lanes for bicycles and micro-mobility modes (see Chapter 7). Importantly, integrating transport and land use and rethinking territories (as discussed in Chapter 4) is crucial to increase the scope for shorter trips and thus the use of active and micro-mobility modes (see the next section).

Using accessibility criteria and designing multimodal networks that allow seamless transfers from and to public transport through active and micro-mobility modes is also crucial. According to Wardman (2014[39]),14 the convenience of public transport depends, among other things, on: access and egress time, and in particular walking time at any stage of the public transport journey; waiting time, including transfer time between services or modes; services available at desired times; transfers; travel time variability; and information (in addition to crowding). In Rotterdam, city authorities partnered with a number of micro‑mobility companies after the COVID-19 outbreak to provide 1 500 shared bikes and 1 500 e‑scooters that were available at 25 different transport hubs (Lozzi et al., 2020[40]).

The pandemic has also generalised teleworking. Teleworking has been incentivised and/or imposed in different countries and cities during the pandemic and it is likely that at least a more hybrid model (than that found before the COVID-19 pandemic) will define future work patterns (Lozzi et al., 2020[40]). It is logical to think that teleworking can help moderate the demand for public transport, particularly at peak hours. Nonetheless, there is uncertainty in terms of the effects of telework on non-commuting trips or decisions to move further from the work place.15 Ravalet and Rérat (2019[41]) suggest that public transport authorities will need to understand well the changes in trip patterns and include these in service planning (Buckle et al., 2020[34]). Box 5.4 discusses the potential role of increased teleworking.

Box 5.4. The potential role of increased teleworking

While the emissions reduction potential of teleworking may seem obvious, its impact on emissions is less straightforward than it seems (Buckle et al., 2020[34]). According to Crow and Millet (2020[42]), additional emissions from electricity use at home may offset commuting-related emissions. The extent to which this is the case depends on the length of the commuting trip, the mode of transport and the level of additional emissions from electricity use. This thus substantially varies across regions. Teleworking may also not result in overall travel reductions, as it can increase non-commuting trips (Lin et al., 2006[43]; Moeckel, 2017[44]), and may, in the long term, reduce the need to live close to work, thus contributing to sprawl. Such mixed effects and uncertainties suggest that the potential impacts from increased telework should be treated with caution.

Increasing the chance that teleworking could play a role in reducing emissions calls for implementing it in combination with other policies (e.g. road pricing, parking pricing and management, fuel taxes, etc.) (Lin et al., 2006[43]). This would increase certainty that it serves the purpose of reducing car dependency and thus that reductions from peak-hour commuting are not compensated (thus effectively reducing congestion, emissions and air pollution) (Bojovic, Benavides and Soret, 2020[45]). Bojovic, Benavides and Soret (2020[45]) highlight the importance of combining teleworking with road space allocation and city redesign (see Chapters 3 and 4).

The risk of increased sprawl due to teleworking also calls attention to the role of land-use policy and territorial planning. Careful analysis of regulations for new developments (see Chapter 4) can help avoid the expansion of low-density areas (e.g. detached houses with big private green spaces), which make the development of dense and multimodal transport networks difficult, and increase travel distances and car dependence. As discussed above, even if commuting trips are reduced, other trips may compensate and increase emissions if more people become car dependent. Strategic and integrated planning at the metropolitan level (see Chapter 4) can importantly help align incentives and planning at the municipal and metropolitan levels. As highlighted by Zenkteler et al. (2019[46]), flexible land-use zoning is also key for transforming current residential areas into multi-purpose neighbourhoods, increasing their attractiveness.

Overall, the complex impacts of teleworking on transport, land use, energy consumption and ultimately greenhouse gas emissions call for carefully monitoring and understanding of new trends and the drivers behind them. The causal loop diagrams used in this report provide an overview of the dynamics that teleworking may trigger, and can be useful tools for taking more informed decisions on the policies needed to avoid the undesired dynamics that may arise from it.

5.2.2. Shared on-demand modes: The untapped potential of technology

While sharing rides or vehicles is not a novelty, new technologies such as apps to geolocalise and book rides/vehicles open up enormous opportunities for increasing the attractiveness of shared (including active) modes of transport. By facilitating cycling and micro-mobility16 (e.g. shared (e)bicycles, cargo (e)bikes, e‑scooters), and shifting trips from low-occupancy private vehicles to shared and high-occupancy vehicles (e.g. on-demand micro-transit services), ride and vehicle sharing can significantly reduce emissions (ITF, 2017[47]; 2017[48]; 2020[49]), while also liberating road space devoted to car parking and use. This can, in turn, increase the scope of the street redesign policies discussed in Chapter 3, and facilitate whole-territories redesign, as discussed in Chapter 4.

This section sheds lights on policies that could allow climate strategies to leverage the potential of shared mobility, orientating it to increasing the role of more sustainable modes. It first focuses on shared bicycles and micro-mobility services, then on on-demand micro-transit.

Mainstreaming shared bicycles and micro-mobility services

If mainstreamed into transport systems, shared bikes and micro-mobility schemes (which as of today remain marginal) could bring important emissions reductions and other benefits. Shared (electric) bikes (docked and dock less) and micro-mobility services (e.g. e-scooters) exist in numerous cities, provided by private companies or public authorities. These services have the potential to encourage a modal shift away from cars, in particular in dense urban areas (but not only). Bike-sharing schemes have, for example, been associated with greenhouse gas emissions reductions, reduced fuel consumption, lower expenditures for households, increased accessibility to public transport and increased physical activity, for instance (Buck, 2012[50]). Modelling results also suggest that a “systemic, electric, shared, and integrated” roll out of micro-mobility services by 2030 in Europe (i.e. assuming that 50% of trips under 8 km could be made by using micro-mobility modes) would result in 30 million tonnes of emissions reductions, 127 terawatt hours of energy savings, while creating nearly 1 million direct and indirect jobs every year. It could also liberate 48 000 hectares of inner-city land (the equivalent to 4 times the area of Paris) (EIT and McKinsey, 2019[51]).

Emissions reductions will, however, depend on various conditions. The first (as with any electric vehicle) is on the carbon intensity of electricity. But beyond this, as shown by de Bortoli (2020[52]) when analysing the introduction of e-scooters in Paris (where electricity is low-carbon), longer vehicle lifespans and sustainable servicing is key. In Paris, an important shortcoming has been that servicing is done with high-emitting (gas-powered) vehicles and involves long distances (since warehouses are located outside Paris) (de Bortoli, 2020[52]). As discussed by EIT and McKinsey (2019[51]), fostering of higher quality parts (which would allow longer lifespans); more local manufacturing and recycling of vehicle parts and batteries; and the development of battery swapping stations and charge and lock stations at mobility hubs (see Chaper 6), which could reduce the need for transporting vehicles and make servicing more sustainable, are all important to ensure sustainable micro-mobility service and make these more viable.

In addition, mainstreaming shared bicycle and micro-mobility services will require overcoming a number of barriers and calls for a comprehensive set of actions (in addition to those mentioned above). Without comprehensive strategies to effectively increase their role, the potential that new apps and technologies have opened up for these types of services will remain mostly untapped.

Overcoming negative perceptions and fostering co-operation between authorities and providers

Concerns over undesired negative impacts have hindered the development of shared bikes and micro-mobility, in particular regarding dock less bikes and e-scooters. The most prevalent concern relates to parking and safety considerations, especially in the case of e-scooters relative to pedestrians.

The “wild” parking of e-scooters is a reality, but tends to be overstated in the public debate compared to, for example, improper car parking, which is much more common but taken for granted and normalised. Many of the commercial providers’ commercial strategies, which have consisted in “flooding’” markets (i.e. streets or sidewalks) to achieve economies of scale, have played an important role in creating parking issues (ITF, 2019[53]). Nonetheless, the negative perceptions related to micro-mobility, including about parking, are also an important reflection and example of the status quo and loss aversion biases discussed in Section 3.2, pointing to the need for effective communication efforts. Brown et al. (2020[54]) analysed vehicle parking practices17 in selected commercial streets in five cities in the United States (Austin; Portland; San Francisco; Santa Monica; and Washington, DC). They found that motor vehicles impede sidewalk access due to improper parking much more than bicycles or scooters. While 25% of motor vehicles were improperly parked, only 0.8% of bicycles and scooters were. Ride‑hailing, taxis, commercial and delivery services accounted for 64% of vehicle violations from motorised vehicles.

Safety issues between micro-mobility users and pedestrians are exacerbated when space is not specifically allocated to bikes or micro-mobility, pushing users to ride on the sidewalk (due to safety considerations of riding next to cars). The redistribution and redesign of road space, the provision of dedicated infrastructure, as well as traffic-calming measures and speed limits for cars and trucks (see Chapter 3) are central to fostering the use of shared bikes and micro-mobility while also reducing safety risks from their use (see more on addressing safety concerns from micro-mobility below). Quality infrastructure for both pedestrians and bikes/e-scooters is also important to avoid conflict between pedestrians and micro-mobility users, and to unlock the potential of the latter as sustainable alternatives to car use, e.g. bikes and e‑scooters can provide access to public transport covering distances that would be too long on foot. A transport system where less space-consuming modes are the norm allows space to be liberated, which can be used to enhance living environments (e.g. increasing green, commercial, housing, leisure space). With dedicated infrastructure, these services could be widely implemented in peripheral areas with mass transit (e.g. light rail) connections, but with a poor connection between people’s residence and mass transit stations (e.g. when mass transit stations are not within walking distance, e-scooters or e-bikes could reduce the dependence on cars). Creating such transport options could be a key component of redesigning suburban areas, in complement with spatial planning to increase proximity and street redesign.

Collaboration and co-ordination between authorities and providers and a “softer” regulatory approach, are needed. The response of many authorities has been to cap (e.g. Mexico City in the case of e-scooters) or temporarily ban (e.g. Amsterdam in the case of dock less bikes) these services. Another common response has been to impose high fees (ITF, 2019[53]). There is a strong case for these services to contribute to the cost of the infrastructure that they use (e.g. cycle lanes and parking space). However, aggressive policies to ban or cap these vehicles contribute to the perception that these are detrimental to social objectives. In addition, very high fees (through licences and/or per vehicle fees) imposed by some authorities make the business model unviable for many operators (ITF, 2019[53]). The level of these fees has, in many cases, also been inconsistent with their contribution to achieving modal shift and environmental goals. For instance, Mexico City organised auctions for bikes and e-scooter licences that yielded fees of USD 68-137 for bike licences and USD 370‑736 for e-scooter licences, which are higher than those paid by taxis. In addition, in the case of bikes, a floor price of USD 53 was estimated, taking into account space consumption and other “externalities”, discounted by the modal shift benefit, which shows that the fees imposed are higher than the social costs generated (ITF, 2019[53]). As highlighted by the ITF (2019[53]), regulatory action needs to be judged in light of public policy objectives, e.g. higher accessibility via sustainable modes. Docherty, Marsden and Anable (2018[55]) also caution that governance structures must set clear and overarching goals and considerations for the long term to enhance public value while enabling innovation to flourish, as there is the risk of public policy becoming solely reactionary if governance structures fail to act. A way forward is to foster collaboration and take a “softer” regulatory approach to shared bikes and micro-mobility, based on: data requirements to help understand modal shift and accessibility effects; surveillance of supply levels matching existing demand; minimum safety standards and promotion of safety education; respect of designated parking spaces and cooperation between providers and authorities to embed parking and use in street redesign objectives; and incentives/regulations for the optimisation of servicing and lifespan characteristics in line with climate goals (as discussed above). Providers and governments can also work together to create partnerships and jointly communicate on the ways in which these vehicles can support environmental and social policy objectives. This will very likely yield better results in terms of social value than the current trend of “hard” regulation based on bans, caps and high fees.

Using a wide range of incentives and increasing financial support

Shared bikes and micro-mobility modes could also be fostered via financial incentives (e.g. tax breaks) to companies incentivising modal shifts from high-emitting modes. This could also be combined with teleworking incentives (see below). Tax credits for providers of shared services could also incorporate shared bikes, e-bikes and e-scooter providers. Scrapping schemes could also include the possibility of switching from car use to public transport and/or other shared modes, as well as active modes.

In addition, as discussed by EIT and McKinsey (2019[51]), the offer of micro-mobility services needs to be enlarged so that it responds to various trip purposes and populations. While some cities (e.g. Freiburg) have introduced e-cargo bikes, these types of services remain quite limited. Shared electric (and regular) bike schemes in most places do not offer options for families (e.g. baby seats, bicycles for kids, etc.). Moreover, micro-mobility could offer a range of new types of vehicles beyond e-bikes and scooters that could also offer better options for different purposes (e.g. buying groceries, transporting kids or the elderly, etc.). EIT and McKinsey (2019[51]) point out that wider financing options for supporting innovation for micro-mobility are needed, as currently, financial institutions other than venture capital do not support innovation for this segment. Different models for users (e.g. leasing and different subscription models) are also needed for these services to expand.

Addressing barriers for low-income users

As in the case of micro-transit and on-demand services (discussed in the next section), direct subsidies for bike sharing and micro-mobility can help achieve “desired connectivity improvements at lowest cost and highest quality” (ITF, 2019[53]), and also contribute to equity considerations. Subsidies for micro-transit and shared bikes or micro-mobility should be considered based on a careful analysis of operational costs (for which competitive processes are necessary). They also need to be designed using targeted subsidies (preferably based on an affordability analysis rather than on age or occupation, e.g. students, groups). These are the same principles recommended for formal public transport subsidies (see the discussion above).

The cost of shared bikes and micro-mobility is, however, not the only barrier for low-income households to benefit from these services. In a study in the United States, Kodransky and Lewenstein (2014[56]) identify a number of other barriers. Among other things, the authors point to government’s role for overcoming these barriers, for instance by including requirements for serving low-income communities when granting rights to operate. This has been done in Washington, DC, where the local transport department required car-share companies to place vehicles in low-income areas. In the case of Boston, the municipality offered grants to bike-sharing services (e.g. Boston’s Hubway) in exchange for service expansion and reporting focused on low-income users (Kodransky and Lewenstein, 2014[56]). Additional recommendations from the authors include: designing pilot projects based on increased knowledge of low‑income residents’ mobility needs (including needs beyond commuting, i.e. to access education, health and childcare); expanding research on business models for better understanding the needs for financial support and subsidies; and making shared mobility modes part of long-term planning tools and exercises (with an emphasis on integrating services with formal public transport) (Kodransky and Lewenstein, 2014[56]). Box 5.3 describes in detail the barriers identified, as well as the examples of programmes and measures put in place in different cases to address them.

Box 5.5. Barriers to introducing shared mobility strategies to enhance accessibility for low‑income groups and how to address them

Analysis in the United States based on a literature review and interviews with academics, government officials and industry professionals reveals that the use of shared mobility services (including car‑sharing, ride-sharing and bike-sharing, but excluding transportation network companies) is very scarce. The study finds barriers to low-income usage of the three types of services, and identifies three main categories of barriers: 1) structural; 2) financial; and 3) informational/cultural. Among the main structural barriers are physical access, since stations are not often located in low-income areas, and logistical access, since users need Internet access and access to smartphones. In terms of financial barriers, there are user costs, since many times these services require lump sum payments in addition to user fees and impose overuse fines, all of which often prices out lower income users. Another financial barrier is the lack of a bank account (a situation that in 2012 included 1 in 12 households in the United States). Finally, informational/cultural barriers include a lack of information and even language barriers for low-income communities with foreign backgrounds and distrust or discomfort with shared services. On the side of providers, barriers include limited profitability when providing these services in low-income areas and increased costs due to liability issues, as there are often perceptions of higher risks.

Examples of governments that have addressed these barriers include:

Physical access: The department of Public Works in Denver introduced explicit regulation for car-share companies with requirements to place vehicles in areas (designated as “opportunity areas”) with at least 30% of the population living below the poverty line. The New York Department of Transportation, collaborated with CitiBike to gather recommendations from the public for the placement of the new stations.

Logistical access: Ithaca car share (in New York City) rolled out an Easy Access plan to facilitate the enrolment of population without or with only limited Internet access.

User costs: The Boston Hubway bike-share system in New York introduced a reduced fee (USD 5 instead of USD 85) for low-income populations. The company has a significantly higher (11%) share of low-income users compared with other bike-share systems (5% on average). The municipality offered grants to support the company. In San Francisco and Oakland, the selection of beneficiaries by a welfare programme put in place by the California Social Services Department has been used as the basis and the programme’s beneficiaries do not pay registration fees for using shared services.

Lack of access to bank accounts: partnerships between shared mobility systems and banks or credit unions have been put in place to reach unbanked individuals. This is the case of Capital BikeShare in Washington, DC; CitiBike and Ithaca CarShare in New York; and iGO in Chicago. The issue has also been addressed by offering alternative payment modes, e.g. money order systems were used in Buffalo.

Informational barriers: special outreach programmes have been put into place, for instance by Ithaca CarShare with a local community in New York, while in Minneapolis the city introduced an outreach programme in support of bike-sharing.

Profitability barriers: federal, state and local funds have been used to subsidise capital investment in shared mobility or to users directly (although this still remains limited practice). An example is the Job Access and Reverse Commute Program. The funds of this programme from the US Department for Transport were dedicated to supporting capital costs as well as operating costs. While a large share went to formal public transport, the programme also provided significant support to shared vans providing services to low-income populations.*

Increased costs because of liability issues: insurance networks have begun to specialise in covering shared mobility schemes. Non-profit schemes in Denver (eGo) and San Francisco (City CarShare) are, for instance, covered by such an insurance network.

* These funds were transferred to the Moving Ahead for Progress in the 21st Century Act Program, which changed the eligibility criteria; therefore, the programme no longer focuses on improved access to low-income communities.

Source: Kodransky and Lewenstein (2014[56]).

The potential of micro-transit

Micro-transit can be defined as “privately or publicly operated, technology-enabled transit service that typically uses multi-passenger/pooled shuttles or vans to provide on-demand or fixed-schedule services with either dynamic or fixed routing” (SAE International, 2018[57]). While mass transit remains the backbone of shared and high-occupancy mobility, micro-transit can play a key role in developing efficient multimodal transport networks.

If not steered towards shared modes, technology-based mobility can bring negative, rather than positive, outcomes. Technology-based mobility services are often conflated with shared mobility. Crozet (2019[58]) identifies four models of technology-based mobility services: 1) peer-to peer car rental; 2) short‑term rental of vehicles managed and owned by a provider; 3) ride-hailing, ride-sourcing, e-hailing (Uber-type services, except Uber pool); and 4) ride-sharing, micro-transit or on-demand public transport.18 These services’ emissions reduction potential varies widely, and analysis suggests that only a wide adoption of the fourth model can materialise into significant carbon dioxide (CO₂,) air pollution and congestion reductions (since none of the first three models effectively tackle low occupancy) (Crozet, 2019[58]). In most countries, however, the third model, i.e. ride-hailing that is not shared, often provided by transportation network companies, has expanded widely and resulted in increased congestion, emissions and low efficiency of road space use. For example, de Bortoli (2020[52]) finds that in Paris, taxis and ride-hailing vehicles were the highest emitting modes per passenger-kilometre, followed by private cars. The increase in total travel resulting from the introduction of these services is, to some extent, a result of a market correction, since in many cities taxi supply was restricted and insufficient. It is, however, also the result of modal shifts from public and active modes towards ride-hailing services (thus, from less emission-intensive to more emission-intensive modes) (Crozet, 2019[58]). Ride-hailing has also resulted in an increase in the vehicle stock (Crozet, 2019[58]).

Micro-transit (the fourth option) can significantly contribute to lowering emissions by increasing vehicle occupancy and improving the efficiency of the public transport network. There is significant potential, in particular in contexts where public transport may have important quality and coverage gaps, for on-demand micro-transit services to play a key role in providing better alternatives to car use. The ITF (2019[53]) argues that these services can incentivise modal shifts from private vehicles and low-occupancy ride-sourcing by “providing higher quality transit services at prices that represent a premium to standard public transport, but a significant discount to ride-sourcing”, also increasing in many cases general load factors (ITF, 2019[53]). Many of these services provide flexible collect and drop-off points that are equidistant from the origins/destinations of the passengers riding them, allow for easy booking, and offer services that cost less than car ownership and use or alternative lower occupancy (e.g. taxis, Uber) alternatives (see Box 5.6).

Experience with on-demand micro-transit is still limited and shows that results depend on the specific local circumstances. For instance, in Mexico City, analysis of an on-demand mini-van service (Jetty)19 showed that around 50% of trips were previously done by private cars and ride-hailing. Nonetheless, a large share of the remaining trips came from semi-formal (microbus) public transport services (Flores-Dewey, 2019[59]). On the one hand, the incumbent microbuses are higher occupancy vehicles; on the other, they create congestion by blocking traffic lanes (chasing passengers aggressively and making multiple and often inefficient stops) (OECD, 2015[14]). Jetty services also have better quality and safety standards than incumbent microbuses, and use cleaner vehicles (Flores-Dewey, 2019[59]). In some cases (including the Jetty example), new on-demand service companies have integrated incumbent operators as drivers in their services (Flores, 2018[60]). This allows reducing equity concerns that the shift towards a better quality system (and the shift towards cleaner fleets) results in leaving a segment of the population without a livelihood. It also increases feasibility, as in many cases, incumbent operators are well-organised and constitute a powerful group that can oppose change (OECD, 2015[14]).

Paternina Blanco (2020[61]) estimates that if such a trend was generalised in the Latin American region and paratransit (i.e. informal or semi-formal) services became digitalised on‑demand shared services, CO₂ emissions from urban passenger transport systems could be almost 40% lower in 2050 than if these services remained in their current state.20 Reductions would only occur if services were integrated with formal transport services. In this situation, integration would mean higher ridership for public transport services, as well as a reduction in urban congestion thanks to the co-ordination of fleet movements. However, if services were not integrated with formal public transport, the potential would be lost. Instead, emissions could be more than 10% higher by 2050 than if digitalisation had not taken place at all. In such a situation, emissions increases would result from higher congestion due to a lack of fleet co‑ordination, as well as from a decrease in public transport ridership brought about by competition. Fleet electrification could increase the positive decarbonisation impacts. If, beyond service integration, policies aimed at supporting paratransit operators into renewing their fleet, by 2050 CO₂ emissions could be almost 70% lower than if paratransit services had not been digitalised, integrated to formal public transport services and electrified.

There are also some interesting examples of on-demand services introduced during the COVID-19 crisis that bring attention to the potential these services have in developing accessible, resilient and highly adaptable transport systems, while also contributing to shifting away from car dependency (Box 5.6).

Box 5.6. The role of shared mobility and on-demand van services in addressing the COVID-19 and climate crisis

Urbvan is a vanpooling, shared mobility company that provides services in a number of cities in Mexico. Before the COVID-19 pandemic, Urbvan’s main business model in Mexico City was focused on servicing workers going from central and residential areas (e.g. Polanco, Mixcoac, Naucalpan, La Condesa, etc.) to the main business districts (Santa Fe, Reforma, Interlomas). Commuting from these neighbourhoods to the business districts, especially during peak hours, requires long journeys, even with private vehicles. Most of the residents making these trips own private vehicles and use them to commute during the week. Public transport service options for these trips are limited and dominated by low-quality services (microbuses). This is, therefore, not a convenient or comfortable alternative to incite private vehicle users to shift to more sustainable modes of transport. Urbvan has therefore provided a way for this segment of workers to avoid having to commute by car. Similar to numbers calculated by other companies (see the Jetty example above), a survey made on its users revealed that around 51% of Urbvan users would otherwise have commuted by car.

With the COVID-19 health crisis, most workers using Urbvan shifted to teleworking and the company experienced a severe drop in activity. Urbvan decided to change strategy and focus on a different market segment that to date had remained marginal: providing services for companies that in turn offered, or subsidised commuting services for their employees.

Urbvan implemented a number of rigorous hygiene measures, providing customers with sanitary kits, adapting vehicles for social distancing and keeping track of contact between employees beyond the working space (to rapidly signal contact cases). While companies could enforce sanitary measures in work areas, the commuting link constituted an important daily risk. Thus, by purchasing Urbvan services, companies could minimise the risk of an outbreak among their staff and support rapid identification of potential contagion to stop it from spreading. Overall, Urbvan became an important solution for a number of trips that would increase the risk of contagion if they were carried out in other public transport services with limited capacity to offer safe conditions. Furthermore, it also avoids minimising health risks due to overuse of private cars and its negative impacts, including carbon emissions.

Urbvan is now progressively servicing intercity trips, which have significantly increased as teleworking practices expand and as the population moves to other cities and only goes to Mexico City periodically. The question of the impacts of increasing teleworking on land use, transport, and related environmental and social outcomes is a relevant one (see discussion earlier in this chapter). On-demand public transport services could be an important part of a strategy that looks to avoid car dependency and related negative climate and other (e.g. air pollution, inequitable access) impacts.

Sources: (Urbvan, 2020[62]) (UrbVan, 2021[63])

Mainstreaming micro-transit may imply a number of changes in government in terms of regulation and monitoring frameworks. These changes could also facilitate the street and territories redesign discussed in Chapters 3 and 4, and are also important for the regulation of micro-mobility and active shared modes (as discussed above).

First, setting and monitoring minimum service and safety standards is a pre-condition for well‑functioning micro-transit services. Authorities may not all have such regulatory power, or governance structures allowing them to regulate micro-transit at the most efficient territorial level (e.g. peripheries rather than just the city centre) (see Box 5.1).

Second, the capacity to set data requirements, and analyse such data to plan and regulate services appropriately, is another condition that may not be met in all countries. Analysis suggests that innovation in terms of public-private partnerships involving data sharing may be required to unlock the benefits of micro-transit (ITF, 2015[64]). International experience suggests that metropolitan transport authorities can play an important role in both regulation and data management and requirement settings (ITF, 2018[23]) (see Chapter 4).

Third, authorities may need to update legal frameworks to remove barriers to micro-transit development. For example, the Mexican Federal Economic Competition Commission (COFECE) recently released an analysis highlighting a number of ways in which the current legislation for intercity passenger services impedes the development of new business models and limits the possibilities that new technologies can bring. Among these barriers are the possibility to propose reduced tariffs when ridership is high, and the need to establish fixed routes and collect/drop-off stations, which impedes services from adapting to traffic conditions and proposing collect and drop-off points that will minimise last-mile travel needs (COFECE, 2019[65]).

Fourth, financial support (e.g. subsidies) could be allocated to micro-transit. Such financial support could facilitate their development in areas where services might have limited profitability but could ensure social value (ITF, 2019[53]). Governments could also consider tax credits for mobility providers indexed to load factors, to incentivise high levels of occupancy. Incentives (e.g. tax breaks) could also be provided to companies that demonstrate a high share of pooling among employees, including shared vehicles (cycling, micro-mobility and public transport) rather than car-pooling exclusively. In this case, setting thresholds that vary depending on location (i.e. higher thresholds for companies located in dense city centres) could be used (Sperling, Pike and Chase, 2018[66]).

Fifth, the reallocation, redesign and pricing of road space (discussed in Chapter 3) can also contribute to increasing the attractiveness of micro-transit. For example, road-pricing instruments differentiated by occupancy levels could make single- or low-occupancy car travel relatively more expensive, and thus less attractive vis-à-vis micro-transit (see Chapter 3). Pooled vehicles can also be granted special stop and parking space at specific locations (e.g. airports) (Sperling, Pike and Chase, 2018[66]).21

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Notes

← 1.  As discussed later on in the chapter, authorities could also improve the provision of public transport in low-density areas by carefully planning networks and retaining a certain level of public control over the services provided (Mattioli et al., 2020[13]).

← 2.  As it penalises the segments of the population depending on public transport, often low-income households.

← 3.  In many cases this is exacerbated by a lack of regulatory capacity by governments. See Section 5.2.1.

← 4.  Transport performance is computed as the ratio of accessible destinations to nearby destinations (ITF, 2019[7]).

← 5.  See Section 5.2.2 for a discussion on micro‑mobility and pedestrians.

← 6.  The process in each city has been distinct and more or less successful. For instance, in both Bogotá and Chile, competitive tendering has been established, while in Mexico City this step was never taken (OECD, 2015[14]).

← 7.  Economically speaking, non-earmarked cash transfers could be a superior alternative. Practice has shown that current conditions (e.g. under-priced private vehicle use) could lead to some negative impacts from the use of these funds (at least in the short run). For instance in Bogotá, cash transfers provided with the intention to increase affordability for covering public transport fares were very often used to buy highly polluting, but low-cost, motorbikes, which are also associated with high traffic fatalities (ITF, 2017[15]). Thus, at least until a number of conditions (e.g. correct pricing of private vehicles) are fixed, direct public transport fare subsidies might still be a good alternative, in practice (ITF, 2017[15]).

← 8.  Competitive tendering is also key to ensuring that subsidies are channelled to bridging the gap between affordability and the cost of quality services rather than covering inefficient operations (ITF, 2017[15]).

← 9.  Nonetheless, fare-box revenues are still an important source (ITF, 2018[23]). Affordability issues can justify subsidising public transport prices (Cervero, 2011[32]).

← 10.  The VT is paid as a percentage of the employer’s total payroll cost.

← 11.  A business rate supplement can be applied to existing commercial developments with rateable value above GBP 55 000, charged at 2 pence per pound of rateable value.

← 12.  A charge levied on the most polluting cars driving through central London.

← 13.  The impacts of teleworking and new behaviour triggered by the COVID-19 pandemic (discussed later in this chapter) will, of course, need to be acknowledged as peak times, for instance, might now be at different times of the day in many places.

← 14.  The report provides ways forward for measuring and valuing such elements, as well as for mainstreaming these into policy decisions (e.g. socio-economic appraisals).

← 15.  This might mean less but longer commuting trips.

← 16.  The ITF (2020[67]) defines micro-mobility as “the use of vehicles with a mass of less than 350 kg and a design speed of 45 km/h or less.”

← 17.  Based on original data.

← 18.  On-demand public transport refers to bus-like services that are adaptable to consumer demand in relation to scheduling, route and/or other service elements, while micro-transit refers services using mini‑buses and app-based booking.

← 19.  Jetty implemented an app-based booking system and uses data to adjust routes.

← 20.  Results stem from an analysis based on the global urban passenger transport model used for the ITF Transport Outlook 2019. The ITF Transport Outlook 2019 focused on potential impacts of various transport innovations for transport activity for all world regions up until 2050, including increased shared mobility. The results for Latin American cities come from an analysis that calibrated the Outlook’s urban passenger transport model with additional regional case studies. The analysis was carried out before the COVID-19 pandemic and so does not include changes that could have resulted from it. The analysis was quantitative, and did not consider the political economy of the proposed changes, such as the necessary interactions between public authorities, private entrepreneurs and paratransit operators, required for having the highlighted integration.

← 21.  Although overall, public transport would need to be the most convenient way to access airports and train stations (OECD, 2015[14]).