Investigating the behavioural impact of a price-differentiated kilometer charge

Abstract

This paper investigates the kilometer charge and the potential effects of emission-based differentiation, how this policy is supported among Dutch citizens and how it affects different groups. It investigates the behavioural change caused by the new policy using Dutch stated preference discrete choice data. Two stated choice experiments are performed, one exploring the demand for privately used alternative fuel vehicles and one on the modal shift for one-person trips with varying distances. A mixed logit model was applied to determine to what extent specific groups were price-sensitive to the kilometer charge. We find that well-educated,high-income people, who either frequently use their car or own a business car, are more incentivised by the kilometer charge to purchase alternative fuel vehicles. In general, people value purchase prices over the kilometer charge and range. Moreover, it turns out that these groups are willing to purchase a substantially more expensive car in exchange for a lower variable kilometer charge. By applying a multinomial logit model for all distances in the mode choice experiment, we find that the least sensitive group towards the kilometer charge for a modal shift are high-educated, older, commuting car users that live relatively far away from the nearest train station. Furthermore, the larger the travel distance, the higher The value of travel time savings ranges from 4.44 - 14.00 euro for distances including train and car whilst small city trips with bike and car as mode alternatives have a value of 6.86 euro. The found behavioural effects were used to evaluate the impact of constructed scenarios with varying tariffs for the kilometer charge, ultimately showing that an emission-based differentiation can positively affect tax income and emission savings. Besides that, this implementation form is the most supported by the Dutch population. In addition to these substantial insights, this paper makes a contribution by showing how stated preference discrete choice data can enhance the decision-making of such pricing policies.