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Policy Framework for Greening Transportation in Georgia

Policy Framework for Greening Transportation in Georgia. Jen JungEun Oh September 28, 2012 World Bank Sustainable Development Department. 1. Framing the Policy Questions. 2. Defining Goal, Principle, and Instruments. 3. Policy Framework for Greening Transportation.

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Policy Framework for Greening Transportation in Georgia

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  1. Policy Framework for Greening Transportation in Georgia Jen JungEun Oh September 28, 2012 World Bank Sustainable Development Department

  2. 1. Framing the Policy Questions 2. Defining Goal, Principle, and Instruments 3. Policy Framework for Greening Transportation 4. Economic, Environmental Benefits of Green Transport Framework 5. Road Map for Framework Implementation

  3. Defining green transportation in Georgian context Reduced Fossil Fuel Consumption Increased Reliance on Indigenous, Clean Energy Sources Minimized Impacts on the Global and Local Environment (GHG, local emissions) Improved Balance of Trade and Energy Security Reduced Road Congestion Co-benefits Green Transportation in Georgian Context

  4. Policy motivation for green transportation • Transport sector’s contribution to economic growth • Export competitiveness • Lower prices of goods for Georgian customers • Competitive position in international transshipment • Attraction to tourist destinations • Improved regional integration • Improved access to market and services of rural communities • Catalysis for service sector development  Good connectivity and low cost transportation brings economic benefits

  5. Policy motivation for green transportation Opportunity: Current capacity and potential for hydropower is high Challenge: Oil imports contributes to the current account deficits

  6. Energy Policy motivation for green transportation • Road transport accounts for major share of emissions CO Emissions by Sector NO Emissions by Sector Industry Road Transport PM10 Emissions by Sector SO2 Emissions by Sector

  7. Rationale for Government involvement Possible trajectories of motorization rate growth in Georgia Vehicle ownership growth trajectories vary greatly at same income level

  8. Rationale for Government involvement • Lock-in effect of infrastructure investments • Transport infrastructure determines long-term trajectory of travel and land-use patterns and transportation costs • Market failure exists in transport sector • External costs: congestion, local emissions, GHG emissions • Appropriate intervention by Government can correct the distortion

  9. 1. Framing the Policy Questions 2. Defining Goal, Principle, and Instruments 3. Policy Framework for Greening Transportation 4. Economic, Environmental Benefits of Green Transport Framework 5. Road Map for Framework Implementation

  10. Goal and Principle • Goal: “to reduce the total cost of transportation including all direct and indirect costs, while maintaining total social welfare benefits” • Principle: Influence and improve choices (without undermining the market economy)

  11. Instruments: how to influence/improve

  12. 1. Framing the Policy Questions 2. Defining Goal, Principle, and Instruments 3. Policy Framework for Greening Transportation A. Integrate Environmental Concerns into Transport Policies 4. Economic, Environmental Benefits of Green Transport Framework 5. Road Map for Framework Implementation

  13. Why this measure? • No environmental objectives in transport policies • A regulatory framework is not being enforced • Local emissions vary by fuel quality and vehicle standards • Environmental policies should aim to curtail emissions at source European Union Vehicle Emission Standards for HC and NOx

  14. How can this be done?

  15. 1. Framing the Policy Questions 2. Defining Goal, Principle, and Instruments 3. Policy Framework for Greening Transportation B. Achieve and Maintain a Greener Vehicle Fleet 4. Economic, Environmental Benefits of Green Transport Framework 5. Road Map for Framework Implementation

  16. Why this measure? • Dominance of second-hand vehicles and lack of vehicle standards enforcement Vehicle fleet age is significantly higher in Georgia than in EU-27 Vehicle fleet ownership will grow much faster as income grows

  17. How can this be done?

  18. 1. Framing the Policy Questions 2. Defining Goal, Principle, and Instruments 3. Policy Framework for Greening Transportation C. Promote Low Emission Freight Transport Modes 4. Economic, Environmental Benefits of Green Transport Framework 5. Road Map for Framework Implementation

  19. Why this measure? • Transit traffic is increasing; share of rail transit decreasing Growing share of transit cargo of total international road transport Decreasing share of rail transport of total transit cargo

  20. Why this measure? Containerized cargo volume handled in Georgian seaports has increased rapidly

  21. How can this be done?

  22. 1. Framing the Policy Questions 2. Defining Goal, Principle, and Instruments 3. Policy Framework for Greening Transportation D. Support Commercial Development of Intercity Passenger Transport 4. Economic, Environmental Benefits of Green Transport Framework 5. Road Map for Framework Implementation

  23. Why this measure? • Under-regulated/underdeveloped intercity passenger transport market offers inferior service quality (lack of safety, environmental damage) • Lack of intercity transportation options hinder future tourism potential • Foreign transport services companies reaping benefits from the increasing number of visitors • Clean and high-quality intercity bus services can compete with private road transport

  24. How can this be done?

  25. 1. Framing the Policy Questions 2. Defining Goal, Principle, and Instruments 3. Policy Framework for Greening Transportation E. Transform Minibuses, Taxis into Modern Urban Transport Modes 4. Economic, Environmental Benefits of Green Transport Framework 5. Road Map for Framework Implementation

  26. Why this measure? • Minibuses generate local emissions, congestion • Contractual arrangement is not conducive to competition and long-term sustainability • Unregulated taxi market contributes to negative externalities • These modes need to be integrated into coherent public transport services Minibuses fleet in Georgia is old and getting older over time

  27. How can this be done?

  28. 1. Framing the Policy Questions 2. Defining Goal, Principle, and Instruments 3. Policy Framework for Greening Transportation F. Support Sustainable Development of Urban Transport 4. Economic, Environmental Benefits of Green Transport Framework 5. Road Map for Framework Implementation

  29. Why this measure? • High energy consumption of Tbilisi transport sector

  30. Why this measure? Inverse correlation between energy consumption and density Very low charges or other restriction on parking in Tbilisi city center

  31. How can this be done?

  32. 1. Framing the Policy Questions 2. Defining Goal, Principle, and Instruments 3. Policy Framework for Greening Transportation 4. Economic, Environmental Benefits of Green Transport Framework 5. Road Map for Framework Implementation

  33. Business-as-usual vs. Green Transportation

  34. Business-as-usual vs. Green Transportation • Motor fuel consumptions Business-as-usual Green Transportation

  35. Business-as-usual vs. Green Transportation • CO2 Emissions Business-as-usual Green Transportation

  36. Fiscal implications • Reduction in fuel imports would lead to reduction of the current account deficits • Can be designed not to undermine the small government philosophy • Income (households) and cost (firms) effects of fiscal measures can partly be compensated • Revenues can be allocated for development of green transport modes • Compensated by reducing taxes that have negative effects on economic growth

  37. 1. Framing the Policy Questions 2. Defining Goal, Principle, and Instruments 3. Policy Framework for Greening Transportation 4. Economic, Environmental Benefits of Green Transport Framework 5. Road Map for Framework Implementation

  38. Phased implementation of priority actions (1) • Short-Term (2012-2014): Institutional Capacity and Preparatory Tasks • Strengthen the institutions and policies at national and municipal level • Carry out preparatory work and studies for medium-term actions, including • Assessment of appropriate levels of transit truck charges • Green logistics study: feasibility of transshipment facilities • Strategy for intercity passenger transport • Strategy for minibus reform, taxi regulations • Urban transport strategic plans in cities other than Tbilisi • Alternative analysis / feasibility studies for public transport modes in Georgian cities, including trams, ropeways, LRT, BRT

  39. Phased implementation of priority actions (2) • Medium-Term (2015-2020): Enforcement, Market Reforms, and Infrastructure • Implement the improved regulatory framework • Promote market competition through key sub-sector reforms • Develop infrastructure for lasting transformation • Long-Term (2020 and after): Transformation • Transform mobility using advanced technologies • Shape green mobility patterns

  40. Thank you

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