On Small Changes, Small Cars, Tax and Pollution

It’s fair to say that encouraging people to change their behaviour in small ways can have a big impact – cumulatively – on reducing carbon footprints and environmental impact in the long-term.

But how Governments and authorities manage and cajole the public to change personal behaviour can be a problematic process – and something that’s difficult to get right. One obvious avenue available is to incentivise change by introducing tax-breaks on ‘environmentally friendly’ products and services, and hiking tax on high-polluters. That seems to be the idea behind planned changes to the Congestion charge policy in London, which – rightly or wrongly – from next year, is being turned into an environmental charge based on carbon dioxide emissions from cars.

You can read more about it in detail here, but in short, the plan is that whereas currently nearly everyone pays £8 per day, by 2009, cars which emit more than 225 g/km of CO2 will be charged £25 ($50) a day to drive into central London. Ouch. But the flip side – the ‘tax-break’ – is that if you drive a car that emits less than 120g/km of CO2, then access is free. The idea is to move people from gas-guzzlers to eco-friendly fuel-sippers, and thus see CO2 levels in the city fall. Nothing wrong with that you might think, but there’s a potential flaw…

Sales of these small, ‘sub-120g/km’ cars are soaring across the south-east of England. A new report by CEBR (report not available openly) suggests that this ‘environmentally-driven’ policy could actually end up causing CO2 levels to rise. That’s because it’s predicted the changed system will have a net result of up to 10,000 extra cars a day entering central London. And that can only lead to an increase in congestion, and a slow down in traffic speeds. As anyone who understands the internal combustion process will tell you, the problem with (even highly efficient, and small) engines, is that they’re at their least efficient when the car is sat stationary or moving at low speeds. So despite the fact that most of these additional cars will be classified as ‘environmentally friendly’ and driving around congestion charge-free, the extra traffic and congestion they create could mean CO2 levels actually rise.

You will, doubtless, be surprised to hear that kit like this will cost £25-a-day to drive in central London come next year…

Whether the report’s predictions prove true, only time will tell. One potential caveat to consider is that it was commissioned by Land Rover – who aren’t exactly known for their small cars (in fact, every vehicle they currently sell falls into the £25-a-day category). In the auto-industry, nothing is ever quite as black and white as it first seems… but there’s plenty of support for it’s predictions in the form of academics for instance, who have no reason for bias.

The big questions it begs, is how governments, authorities and legislators drive a process of adoption for new, more environmentally friendly products and technologies, without having the entire process back-fire on them at ground level? The message they’re putting out to people here is ‘do this, and because you’re helping save the planet, we’ll reward you’ – but in fact, that ‘reward’ might end up having quite the opposite effect on the planet’s health. Don’t ‘reward’ people’s for changing their behaviour, and they’ve no reason to change. So the carrot-stick approach is difficult. I suspect this policy might go down in history as being one of those top-down processes, that on paper looked great – but which back-fired terribly on the ground by having precisely the opposite impact to what was originally intended. Another case which will show the need for grass-roots level innovation and adoption, rather than top-down? I think so.