Tradable Mobility Credits for Long-Distance Travel in Europe – Impacts on the Modal Split between Air, Rail and Car

Abstract

Long-distance travels cause a large share of total greenhouse gas emissions. Environmental policy instruments aim to direct people’s travel behaviour, but at present, they are not sufficiently effective. As an alternative to existing policies, there is growing attention to market-based pricing instruments. Such an innovative policy instrument is the Tradable Mobility Credit Scheme (TMC). It allows for the direct internalisation of externalities into the price of mobility. This study specifies a TMC which shall be internationally implemented in Europe. The objective of the study is to estimate the impact of such a TMC on the modal split for long-distance leisure travel in Europe. Therefore, first, a mode choice model is created to estimate the current modal split of long-distance routes in Europe. Second, the TMC is incorporated into the mode choice model, and the modal split under TMC is estimated. A case study with 73 European cities and 2,998 OD-pair connections is conducted. Flight and train ticket prices are obtained by web scraping. The credit price is found to be 193€ per ton of CO2 under the boundary condition of reducing emissions by 30%. Hence, for a trip from Zurich to Amsterdam, a traveller bears additional costs of 31€ when travelling by plane, 5€ by train and 19€ by car. It is found that, on average, the TMC induces a decrease of the modal share of air by 12% (from 50% to 38%), an increase of the modal share of rail by 9% (from 23% to 32%) and an increase of the modal share of car by 3% (from 27% to 30%). The competitiveness of rail travel time is most critical for the modal shift towards rail. Furthermore, the TMC induces a reduction of travel demand by 17% on average for the incorporated routes. Modal shifts and trip cancellation rates largely vary between OD-pair connections.