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Innovative road network pricing models

road network pricing models

This research aims to investigate new methods for managing urban congestion and reducing emissions through innovative transport pricing policies that encourage travellers to reduce their reliance on private vehicles and encourage the use of alternative low carbon/low emission modes of transport.

It is postulated that such pricing policies will have a substantial influence on travellers’ mode choice and time of travel and will promote a behavioural shift with lasting impact on travellers adjusting their travel behaviour and mobility patterns to be more sustainable.

To achieve this, the research will first establish current and emerging trends in urban transport pricing, and the technology solutions available to facilitate their implementation. This will be followed by testing and evaluating the impacts of these policies using traffic simulation models that replicate traveller’s behaviour under dynamic pricing policies that vary by location, distance, time of day and other similar policies.

The successful completion of this research will provide government agencies and road operators with the necessary tools that allow them to evaluate the effectiveness and impacts of various pricing interventions and selecting policies that either individually or collectively deliver the best outcomes for reducing congestion, improving amenity, and reducing emissions.


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Project background

The reform of urban mobility remains one of the biggest challenges facing policy makers around the world. Traditional approaches for managing urban mobility through building additional transport infrastructure have been met with limited success. As our cities become more populated, urban transport infrastructure will increasingly become under more pressure resulting in more traffic congestion and emissions. More sustainable approaches are therefore needed to manage the demand for travel in our cities.

The emergence of disruptive technologies and business models, including innovative pricing strategies are introducing new opportunities for managing the demand for mobility in a more sustainable manner. One of the key strategies to address these issues is to manage the entry of motorised vehicles in congested urban areas using congestion pricing.

This is a policy instrument that planners, decision makers and peak bodies such as the Grattan Institute, Infrastructure Australia, and Infrastructure Victoria have called for as a likely solution to improve mobility and ease congestion. Transport pricing policies, including road pricing and congestion charging, are also increasingly being recognised as important strategies going forward to increase government transport revenues that have been consistently decreasing in the past years due to reduced fuel excise as a result of improved combustion engine efficiencies, shift of passengers to public transport and increasing share of electric vehicles.

This research is fundamentally an investigation into the development and evaluation of new and innovative methods to price urban transport that would offer efficient, affordable and flexible trips while reducing reliance on private vehicle use and reducing congestion and emissions.

Specifically, this research will undertake quantitative research which demonstrates novel use of pricing strategies and signals for managing demand and promoting low carbon mobility solutions driven by disruptive forces which are changing the mobility landscape and providing consumers with more choices to meet their transport needs.

This work started with a systematic literature review to gather evidence about the topic relevant to travel demand management. This work was important to document and the evidence which was scattered and fragmented. A large number of key studies were identified and analysed with respect to a set of research questions on road network pricing that must be answered to meet the objectives of this research, mainly addressing the effectiveness of road network pricing as a travel demand management strategy.

These questions aimed to uncover information on the main topics reported in the literature, their evolution over time, and types of research methodologies considered which collectively provide valuable insights on best practices to deal with specific topics in this field.

Other research questions focus on understanding the fundamentals of the topic, not only for historical framing but also to identify critical research to be investigated in future research. This review has guided the development of the research aim and objectives that are necessary to bridge the identified gaps in knowledge needed to drive future research directions in this topic.

Project objectives

The main objectives of this research include:

  • Establish current situation by undertaking desktop literature review studies to provide an environmental scan about the social, technological, economic impacts and trends in road network pricing, and its important role as an effective strategy for travel demand management. This step, which has already been completed, provided insights into state-of-the-art solutions, methodologies and research efforts on road network pricing, identified limitations and gaps in knowledge, and used these to shape the future research directions in this field.
  • Extend the modelling framework of road network pricing by relaxing the inelastic transport demand constraints in extreme peak hours by serving them with other modes such as public transport and by diverting vehicle traffic to a multi-modal network; assessing user heterogeneity through introduction of multi-class users, differentiating user groups with different value of time in the charging technique; optimising the balance between two main pricing indicators i.e. distance and time in formulating a pricing policy; and test and evaluate a coordinated pricing scheme for multi-region networks, promising green mobility and ensuring reduced emissions.
  • Develop a simulation-based model for assessing how the proposed road network pricing interventions and modern transport policies (particularly congestion charge, parking levies, low emission zones) can reduce congestion and emissions using a case study for Melbourne.

The set of questions identified in this research have been formulated such that they are meaningful and important to researchers as well as practitioners.

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