the clean commuter rebate scheme (ccrs)

2014

The Clean Commuter Rebate Scheme The Clean Commuter Rebate Scheme A PROPOSAL FOR THE ADELAIDE

CITY COUNCIL

Natasha Rayan a1193390

[THE CLEAN COMMUTER REBATE SCHEME] a1193390

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Contents

Abstract ................................................................................................................................................... 2

1. Climate Change ................................................................................................................................... 3

1.1 Transport ................................................................................................................................. 3

1.2 Air Pollution ............................................................................................................................ 4

2. The Clean Commuter Rebate Scheme ................................................................................................ 5

2.1 Execution ....................................................................................................................................... 6

2.2 Intended Outcomes of the CCRS ................................................................................................... 6

2.3 Implications for Stakeholders ....................................................................................................... 7

2.3.1 Adelaide Metro .......................................................................................................................... 7

2.3.2 Other Stakeholders .................................................................................................................... 8

3. Management Strategy ........................................................................................................................ 8

3.1 Timeframe ..................................................................................................................................... 8

3.2 Anticipated Costs .......................................................................................................................... 8

3.2.1 Private ........................................................................................................................................ 8

3.2.1 Social .......................................................................................................................................... 8

3.2.3 Public .......................................................................................................................................... 9

4. Concluding Remarks ............................................................................................................................ 9

5. References ........................................................................................................................................ 10


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Abstract

Climate change is a global issue which requires cooperation on mitigation efforts across all countries.

Australians are amongst the key contributors to global warming and must play their part in lowering

greenhouse gas emissions. Under the Clean Commuter Rebate Scheme, commuters in Adelaide will

be given an incentive to reduce their carbon footprint and offered a rebate on journeys that are

‘clean.’ In this report it is proposed that incentives and positive reinforcement are more effective

advocates for behavioural change than punishment for less desirable behaviour. Given any change in

policy there will always be stakeholders and costs to address which will be discussed at length

throughout.


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1. Climate Change

Climate change has been described as the largest threat to global health of the 21st century (Costello,

et al., 2009). Numerous studies and scientific analysis have shown that human activity can be

directly correlated with the recently observed trends in global warming. Rising global temperatures

are expected to bring about an increase in the occurrence of severe weather events such as heat

waves, droughts, cyclones and storms (Pachauri RK, 2007). Australia contributes to about 1.5% of

the world’s green-house gas (GHG) emissions. While this sounds minimal, take population into

account and Australians are amongst the world’s largest polluters. Australia's carbon dioxide (CO2)

emissions per capita are nearly twice the OECD average and more than quadruple the world average

(DCCEE, 2010). Carbon dioxide forms the largest share of greenhouse gases in the ozone layer.

Human activity has severely impacted the proportion of CO2 in the atmosphere through practices

such as burning oil, coal and natural gas as a source of energy (OECD, 2013). Fuel combustion in cars

and other motorised vehicles is largely responsible for Australia’s contributions to the greenhouse

effect. Stabilisation of the world’s GHG emissions will require international co-operation in order to

alleviate the catastrophic effects of global warming.

1.1 Transport

Significantly greater attention is being paid to the numerous environmental effects caused by the

use of road vehicles. On Australian roads the by-products of fuel combustion in vehicles used for

transportation are responsible for 14% of the nation’s total GHG emissions (DCCEE, 2010). Of this

fraction, road cars account for 54.9% (see Figure 1.1) - so just over 7% of Australia’s total GHG

emissions result from transport by car. It is important to note that trams and other electric vehicles

are not classified as exceptions. Despite the lack of fuel combustion and exhaust releases, the use of

electric vehicles does not lower GHG emissions unless the electricity is generated from clean sources.

In 2010, Australian fuel combustion resulted in 383 million tonnes of CO2 emissions (OECD, 2013).

The transport sector alone accounts for 76 million tonnes but such a figure isn’t surprising when

different fuels are examined for the amount of carbon and energy they contain. Per one litre of

petrol, approximately 2.3kg of CO2 are released from the exhaust (see Figure 1.2). This mass

increases to 2.7kg for vehicles run on diesel engines. It is interesting to note that a greater mass of

CO2 emissions are produced in combustion than the initial mass per litre of fuel and this is due to the

addition of atmospheric oxygen during the combustion process (DSEWPC, 2008).


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1.2 Air Pollution

When fuel combustion takes place is cars, the chemical reaction produces three harmful by-products:

carbon monoxide (CO) which reacts instantly with oxygen in the air to form carbon dioxide (CO2), a

greenhouse gas. The combustion reaction also produces mono-nitrogen oxides (NOx) and volatile

organic compounds (VOC). The CO2 and VOC emissions mostly come from petrol-fuelled cars but NOx

emissions are caused by both LPG and diesel fuelled vehicles (Winther, 1998). CO2 may be the only

Figure 1.1 Shares of Australian Domestic Transport Fuel Use, by transport mode for 1997-1998 (BTRE, 2002)

Figure 1.2 Projections of CO2 equivalent emissions from Australian Domestic Transport (DSEWPC, 2008).


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combustion by-product which contributes to global warming but NOx and VOC are both hazardous

gases which affect air quality. NOx can react with other compounds in the air to form nitric acid

which contributes to acid rain (Blackenship, 1997). High level exposure to VOC has been associated

with respiratory, allergy and immune effects in infants and children (Mendell, 2007). The two gases

can even react with each other in the presence of sunlight to form Ozone. The inhalation of Ozone

can cause major health implications such as lung tissue damage and dysfunction amongst

susceptible demographics (WHO, 2003).

2. The Clean Commuter Rebate Scheme

The Adelaide City Council must recognise that it is necessary for measures to be taken in order to

lower GHG emissions. The current level of CO2 emissions in the transport sector is not sustainable

even with optimistic expectations for existing policy aimed at abatement (see Figure 1.3). However,

the car is a vital means of transportation for most of the population. Taking into account registration

fees, fluctuating petrol prices, maintenance costs and insurance needs; owning, driving and

maintaining a car is already stressful for those who rely on it. Implementing a tax, increasing fees or

otherwise inflating the cost of owning and running a vehicle may achieve a reduction in greenhouse

gas emissions but only from the group of commuters who are able to forgo motorised transport. The

Figure 1.3 Projections of CO2 equivalent emissions from Australian Domestic Transport (BTRE, 2002)


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aforementioned strategy would adversely affect individuals who have no alternative means such as

public transport available to them.

Therefore, in response to the needs of Australians and pressures to alleviate climate change, it is

recommended that the Adelaide City Council implement a rebate scheme for commuters willing to

forgo motorised transport. The Clean Commuter Rebate Scheme (CCRS) aims to provide an incentive

to reduce carbon emissions without making motorists worse off. Implementation of the CCRS would

not affect the benefits to motorists as it does not force them to abate. However, a decrease in the

number of motorists as a result of the CCRS will see a reduction in greenhouse gas emissions.

2.1 Execution

The CCRS will provide monetary rebates to commuters who choose to forgo motorised

transportation. For every kilometre travelled on bike, foot, skates or any other non-motorised means

a rebate of 10c/km will be received. In co-operation with existing cycling and fitness mobile phone

applications and GPS software, features will be developed to track and record commuter journeys

for analysis. This information can then be uploaded to an online database and community if the user

wishes to share their progress with others. The uploads will be checked against existing modelled

data for cycling, running, walking and so on to ensure that only appropriate data is accepted. User

accounts will be linked to their Tax File Number (TFN) and at the end of each financial year a rebate

will be issued. The use of a TFN ensures that users cannot create multiple accounts. The use of a TFN

also ensures that users can only claim rides leading to and from their legally taxed place(s) of

employment.

2.2 Intended Outcomes of the CCRS

Following implementation of the CCRS immediate and long term benefits to individual recipients and

society can be expected. Commuters will firstly benefit from improved health and personal fitness by

factoring exercise into daily transport routines. Secondly, they will see instant savings in petrol costs,

parking costs and public transport costs. In the long run commuters may decide they no longer need

a car or require fewer cars per household. Such outcomes have been documented overseas where

users eliminated the need for a car all together and turned to car hire services in the event that

space was required for a larger payload (Birdsong, 2006). In addition to savings, the CCRS also

facilitates earnings by providing commuters with a rebate for distances travelled.

There are also benefits for society to be gained through implementation of the CCRS. In the long run,

it is expected that the number of motorists commuting to and from work will decrease. This will


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result in lower CO2 emissions from the transport sector and may facilitate the stabilisation of GHG

emissions. Fewer motorists on the road will also alleviate traffic congestion and delays for

commuters who choose not to adopt the CCRS. The decrease in demand for fuel will create an

excess supply forcing a fall in prices.

2.3 Implications for Stakeholders

While the CCRS has the potential to alleviate Australia’s contribution to GHG emissions and provide

incentives for commuters to improve their health and fitness, it does not come without some

implications. Stakeholders within the transport sector may suffer from loss of business and revenue

resulting in consolidation of services or redundancies to employment.

2.3.1 Adelaide Metro

As South Australia’s main public transport service, Adelaide Metro is one of the largest stakeholders

under the CCRS. Starting with the negative externalities, it is likely that a fall in the demand for

public transport will be observed. Commuters living within a reasonable distance (estimated to be

≤10km) from work or study are more likely to embrace the benefits of the scheme and forgo

transport via motorised means including buses, trains and trams than those with a 10km or greater

commute. Adelaide Metro could respond to this expected fall in demand by adjusting routes to and

from the city to include fewer suburbs within a 10km radius. Another option is to increase the

number of express bus and train services from outer suburbs to lower travel times for distant

passengers. The frequency of services for surrounding suburbs of the CBD could also be decreased in

response to the anticipated fall in demand. In addition to this, an increase in the number of cyclists

on the road is likely to hinder ease of manoeuvrability for buses which often travel in the left lane.

On the other hand, there are some positive externalities to be gained from the scheme. The

decrease in motorists will allow for ease of manoeuvrability for buses and lighter traffic conditions.

Demand for public transport will remain unchanged in some weather conditions and potentially for

most of the winter season given fewer hours of daylight. Also, at times when commuters are likely to

consume alcohol such as Friday nights there will still be a demand for public transport. The decrease

in passengers living within reasonable distances of the CBD will mean that residents from further

locations will experience shorter travel times due to fewer stops. Adelaide Metro will also benefit

from the expected fall in petrol prices resulting from a decrease in demand.


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2.3.2 Other Stakeholders

Any business whose operations are dependent upon motor vehicles and transport is likely to be

affected as the CCRS unfolds. This includes but it is not limited to the petroleum industry, mechanics

and maintenance including car wash services, parking lots in the CBD, motor retailers, taxi services

and car insurers. Each of these markets will need to reassess their product or services and adjust to

the change in demand accordingly.

3. Management Strategy

3.1 Timeframe

It is proposed that the CCRS commence during the winter months to capture the attention of

existing clean commuters and gradually encourage the transition of other commuters onto the

scheme as daylight savings time approaches. This will allow time for reviewing and establishing

reliable software and analysis data and it is anticipated that the registration process will run

smoother. It is recommended that this scheme be first implemented as a trial run by the Adelaide

City Council and aimed at commuters travelled to and from the CBD. Should success of the CCRS

follow, it is expected that implementation can gradually proceed at a national level.

3.2 Anticipated Costs

3.2.1 Private

Commuters may face the steep initial costs of purchasing a bike and required accessories before

being able to benefit from the scheme. There are also safety costs to consider for cyclists choosing

to share a road with motor vehicles. However, the safety factor is likely to increase as the volume of

cyclists grows shown by studies on the ‘safety in numbers.’ The research shows that an increase in

the number of cyclists will be accompanied by an increase in injuries to cyclists but at decreasing

rate (Lindsay, Macmillan, & Woodward, 2010).

3.2.1 Social

Social costs may include changes in traffic conditions caused by an influx of cyclists and pedestrians

following the scheme. It is imperative that new cyclists are educated on road rules and follow

appropriate visibility protocol for riding in limited daylight. Education of commuters under the

scheme could be implemented as part of the registration process to ensure all participants are well

informed. A shortage of public bathrooms, showers and other end-of-trip facilities may affect

waiting times and workplace punctuality. Theft of bicycles and other private property will become an


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issue of concern and one that should be addressed in conjunction with the Bicycle Institute of South

Australia (BISA) and South Australia Police (SAPOL), as they have currently developed joint measures

to lower incidences of theft (BISA, 2013).

3.2.3 Public

The most obvious economic cost to the public sector will be the issue of rebates following the end of

financial year. Given a 5km commute (10km round trip), a full time employee who commutes cleanly

for 5 days a week at 40 weeks a year can expect a rebate of $200 under the CCRS in their next tax

return. In 2011, the number of cyclists travelling to and from the CBD between the hours of 7am and

7pm on a typical weekday was recorded at 9,443 (sa.gov.au, 2011). Under the new scheme and

assuming that these cyclists follow the pattern described above, this will cost the city council an

estimated $1.89 million dollars in rebates – an estimate which fails to account for more recent

cycling figures, other clean forms of transport or the influx of clean commuters that are expected to

adopt the CCRS.

It is likely that the shortage of public bathrooms, bike sheds, bike paths and foot paths for

pedestrians will seek a response from the city council subsequent to implementation of the scheme.

These are further costs to consider for the health and safety of commuters and the success of the

CCRS. It is anticipated that initial costs will be high for the scheme but are likely to stabilise in the

long term.

4. Concluding Remarks

Climate change and air pollution are environmental risks which affect the health, safety and

wellbeing of society. Measures must be put into place to mitigate the release of GHGs and other air

pollution. Implementation of the CCRS is expected to result in greater net benefits to the individual

and society over negative outcomes. While some stakeholders will see a fall in benefits in the short

run, the overall long term effects of such a policy are vital for sustainable living conditions. Start-up

costs for both commuters and the public sector are high in the short term but are expected to

diminish as time goes on.


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5. References

Birdsong, A. (2006). Ten thousand bicycles in Portland: bikes, carpools, public transit, and planned

development reduce emissions in Portland. Earth Island Journal 21(2).

The Bicycle Institute of South Australia (BISA). (2013). Bike theft on the ride in Adelaide. Keeping

your bike safe. The Bicycle Institute, SA <http://www.bisa.asn.au/node/336>. [Accessed 29 March

14].

Blackenship, K. (1997). NOx in the Air: Multiple Effects. Chesapeake Bay Journal, 267-280.

BTRE. (2002). Greenhouse Gas Emissions From Transport: Australian Trends To 2020. Canberra ACT:

Bureau of Transport and Regional Economics.

Costello, A., Abbas, M., Allen, A., Ball, S., Bell, S., Bellamy, R., et al. (2009). Managing the health

effects of climate change. Lancet and University College London Institute for Global Health

Commission, 1693-1733.

DCCEE. (2010). Australia‟s emissions projections. Canberra, ACT: Department of Climate Change and

Energy Efficiency 2010.

DSEWPC. (2008). Reducing Greenhouse Gas Emissions. Department of Sustainability, Environment,

Water, Polution and Communities,

<http://www.environment.gov.au/settlements/transport/fuelguide/environment.html>.

[Accessed 29 March 14].

Lindsay, G., Macmillan, A., & Woodward, A. (2010). Moving urban trips from cars to bicycles: impact

on health and emissions. Aust NZ J Public Health, 54-60.

Mendell, M. (2007). Indoor Chemical Emissions as Risk Factors for Respiratory and Allergic effects in

Children: A review. Indoor Air 17(4), 259-277.

OECD. (2013). Emissions of Carbon Dioxide. OECD Factbook 2013: Economic, Environmental and

Social Statistics, 170-173.


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Pachauri RK, R. A. (2007). Climate Change 2007: Synthesis Report. Contribution of Working Groups I,

II and III to the Fourth Assessment Report of the Intergovernmental Panel on Climate Change. Geneva

(CHE): Intergovernmental Panel on Climate Change.

sa.gov.au. (2011) Cycling facts. The Government of South Australia

https://www.sa.gov.au/topics/arts-sport-and-leisure/sport-and-recreation/cycling/cycling-facts.

[Accessed 29 March 14].

WHO. (2003). Health Aspects of Air Pollution with Particulate Matter, Ozone and Nitrogen Dioxide.

Bonn, Germany: World Health Organisation-Europe.

Winther, M. (1998). Petrol Passenger Car Emissions Calculated with Different Emission Models. The

Science of the Total Environmental 224 , 149-160.

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