Scope:

Evaluation of the implementation and effects of EU infrastructure charging policy since 1995, including the evaluation of Directive 1999/62/EC

Evaluation findings:

The external evaluation study identified various problems linked to road charging of heavy goods vehicles under the current legislative framework. While 24 Member States have implemented some form of road charging and there has been a tendency to move towards network-wide distance-based tolling at least in Central Europe, there are persistent inconsistencies in the implementation of the current legislation.

The external evaluation study found a wide variety of ways to vary charges according to Euro class, whereas a third of the Member States do not apply such variation at all. This creates inconsistent price signals to users. Revenues from time-based charges (vignettes) are very low and do not meet the financial needs of infrastructure investment. Very few Member States have introduced time-varying charges to deal with congestion. These issues are linked to the provisions of the Directive:

• Time-based charges allowed by the Directive are ineffective in covering infrastructure costs, incentivising cleaner, more efficient operations or reducing congestion.

• The application of external cost charging is too complex, while Euro class variation is mandatory (with exemptions) and not well defined.

• Variation of charges to fight congestion: the revenue-neutrality requirement is too cumbersome and the variation could be seen as unfair if only applied to HGVs while all users contribute to congestion.

A natural limitation of the evaluation was that it could only focus on the existing scope of the Directive, while the input from stakeholders pointed at other relevant issues. There was broad consensus on the need to reduce CO₂ emissions from road transport. While emission standards are the most effective measure in this respect, they only address new vehicles and their impact over time will depend on the speed of the renewal of the fleet.

Measures such as the modulation of road charges according to CO₂ emissions can make a useful complementary contribution by directly incentivising the renewal of the fleet; they can provide direct price incentives to road users at every single trip and apply to the entire fleet (i.e. new and old vehicles). In addition, as evidenced by the public consultation, road users would like road pricing to be non-discriminatory also in the case of passenger cars, which are outside the scope of the existing legislation.

Estimated savings and benefits

The benefits of applying differentiated distance-based road charging include the shifting towards the use of cleaner vehicles on the short run and a sped up replacing of the vehicle fleet on the long run.

For example, in Germany the fleet was significantly modernised after the introduction of the toll, and new registrations of vehicles with lower Euro standards reduced disproportionately. In 2012, almost 40% of trucks over 12t were Euro V compliant compared to 20% for trucks 2.5-12t. The downgrading of Euro IV vehicles from the beginning of 2006 resulted in a stronger interest in Euro V vehicles, although it should be noted that environmental steering effects are also caused by government incentives.

On the other hand, the Eurovignette charge is differentiated by Euro class, but there are currently no different fees for Euro II-VI. The environmental steering effects have been found to be lower compared to tolls. Although there are still some observed effects on fleet composition in Eurovignette countries, this is thought to be because of spillover effects from international road user charges.

In Sweden, larger vehicles are generally cleaner compared to smaller vehicles. In 2011, the share of Euro V trucks over 12t was 27% compared to 13% for 3.5-12t. This can be partly explained by the fact that only trucks above 12t are charged, and partly due to road distance-based charges applied internationally (typically in Central Europe).

Similarly, time-differentiated charges have the potential to spread traffic during the day, thereby reducing peak-hour congestion:

• In the Czech Republic, time-varying charges on the network-wide toll led to a reduction in peak traffic of 15%.

• In France, increasing toll rates during the weekend rush hour on several motorway sections resulted in a transfer to off-peak periods of 8-12%. These charges include passenger cars, which are thought to be able to adjust travel times more easily compared to freight.

Which objective(s) did the Commission pursue?

The aim of the Commission proposal was to simplify and update the requirements for road charging by:

- replacing the obsolete system of variation according to Euro classes for HDVs with more adequate CO₂ modulation of charges;

- simplifying the application of external cost charges for air pollution and noise (that is a better instrument than modulation by Euro class) by allowing the use of updated reference values without the need to do any calculation;

- simplifying and updating the application of mark-ups and facilitation of the application of congestion charges.

It also aimed to: i) contribute to the reduction of CO₂ emissions in transport via pricing, ii) preserve the TEN-T roads and broader EU road network in good maintenance condition, to avoid disruptions in the European transport system; iii) reduce congestion on the roads which are of importance for cross-border traffic (TEN-T network); and iv) reduce disparities in road charging policies across the EU to better reflect the real cost of road use and ensure that road charging schemes do not discriminate against non-resident motorists.

Estimated savings and benefits

While the regulatory costs related to the initiative would increase with moving to more proportionate, distance-based tolling, as would the compliance costs for many market players, these costs would be outweighed by higher revenues (for Member States and toll chargers), better road quality and more reliable travel times (for road users), reduced negative environmental and health impacts (citizens), and related external costs borne by society (taxpayers).

The simplifications concern mainly national authorities rather than businesses. However, these changes are accompanied by a separate proposal, allowing the reduction of circulation taxes, which could make it possible to decrease the burden on hauliers (SMEs). Overall costs to road users, including citizens and business, are likely to increase, even if only to a small extent. Freight transport costs could increase by up to 1.1%, with costs for passengers unchanged. The possible extension of road charging to new parts of the network and new user groups could increase compliance costs for road users by €198-228 million/year.

Costs to authorities include the deployment of new tolling systems or expanding existing ones for the Member States concerned (one-off investment of €1.2-1.4 billion altogether), and operating costs of €168-200 million/year.

At the same time, the benefits of the preferred option include:

• a decrease in reduce congestion costs by €9 billion by 2030,

• additional toll revenues of €10 billion/year,

• significantly reduced CO₂, NOx and particulate matter emissions,

• improved public health and reduced costs of air pollution and accidents (€0.37 billion by 2030),

• generating up to 208 000 new jobs and additional benefits of 0.19% of GDP, and

• halving the (relative) price of short-term vignettes.

The proposal was expected to have a minor positive impact on competitiveness due to CO₂-differentiated charging, leading to slightly higher uptake of low- and zero-emission vehicles, driving innovation. Increased uptake of congestion charging would be beneficial to the competitiveness of businesses, especially those that make use of just-in-time manufacturing.

Outcome of Legislative Procedure:

The adopted Directive includes as main changes the phasing out of time-based charges (vignettes) for heavy-duty vehicles, the extension of the scope to light duty vehicles and buses and coaches, the option to charge for congestion and wider use of mark-ups, the obligation to charge for air pollution, CO₂-based tolling, and the possibility to exempt zero-emissions heavy-duty vehicles until the end of 2025. The simplifications and burden reduction elements from the Commission proposal have been maintained. The separate proposal allowing the reduction of circulation taxes to reduce costs for transport users is still pending adoption.

Estimated savings and benefits:

The Directive simplifies the application of external cost charges for air pollution and noise by allowing the use of updated reference values without the need to do any calculation.

The Directive has a minor positive impact on competitiveness due to CO₂-differentiated charging, leading to slightly higher uptake of low- and zero-emission vehicles, driving innovation. Increased uptake of congestion charging would be beneficial to the competitiveness of businesses, especially those that make use of just-in-time manufacturing.

Implementation reported by Member States

Transposition deadline: 25 March 2024

Member States have to report on tolls and user charges levied on their territory by 25 March 2025.

Implementation by Commission

The Commission should report by 24 September 2024 on the rates for user charges, thresholds for CO₂ emission classes 2 and 3, and CO₂ differentiation reduction levels.

The Commission has to report by 25 March 2027 on:

- charging of light-duty vehicles;

- charging of light commercial vehicles;

- CO₂ emissions-based charging and consistency with Directive 2003/87/EC and Council Directive 2003/96/EC.