Parking pricing
Every private car trip requires parking at its origin and destination. Parking pricing typically means charging motorists for the use of parking facilities. It can apply to commuter, non-commuter and residential parking. Parking pricing can significantly impact the cost of car ownership and use. The impact is greater for relatively shorter trips as the cost of parking does not vary with distance travelled. Parking pricing policies can affect travel demand for private car trips by reducing that demand and/or shifting demand to different modes, times or locations, thereby reducing congestion and related impacts. Parking pricing also generates revenue for parking space owners and operators.
In practice, parking is rarely priced to cover its costs and is often made freely available – effectively being subsidised by public money or provided as a benefit by employers to employees.
Dynamic parking-pricing systems are gaining popularity. Cities adopting such schemes vary the parking price based on demand, or on the vehicle’s environmental performance.
Parking pricing is most effective when applied coherently in a wider framework of parking supply policy covering (i) the total number of places available, (ii) the different access regimes applied to parts of those places and (iii) the pricing structures and levels for each of those parts.
Parking pricing can encourage a modal shift from the personal car to more-sustainable modes of transport, including public transport and active modes. Parking pricing policies can also encourage the use of more-environmentally-friendly personal cars, if appropriately priced.
If a parking pricing policy can keep approximately 15% of on-street parking spaces available, cruising for parking, which is estimated to account for up to one-third of urban road traffic, can be nearly eliminated. The CO2 savings will be proportionate to the average per-kilometre CO2 emissions of the vehicle fleet.
Such policies will be more publicly acceptable if the associated revenues are used to improve the public space.
In general, a 10% increase in parking prices results in a 1-3% decrease in the demand for parking.
The costs of parking pricing implementation and operation depend mostly on the type of parking-pricing technologies employed. Traditional parking meters cost approximately USD 550 per metre to install, while a sensor-based smart meter can cost over USD 8 000 per metre. Administrative, enforcement and maintenance costs also affect the overall cost. Typically, costs can be covered by revenue from parking charges and parking fines, making the operation of charged-parking areas attractive for the private sector.
In Amsterdam (Netherlands), for example, revenues from parking fees amounted to an estimated EUR 162 million in 2014, more than 27% of total revenues from municipal taxes. In the Dutch municipality of Zandvoort, parking fee revenues accounted for 26% of total revenues from municipal taxes. For one in four Dutch municipalities charging parking fees, revenues account for at least 10% of total municipal tax revenues.
The Canadian city of Victoria earned around USD 10 million net from their parking scheme in 2009. USD 15.4 million gross revenues from on-street meters, multistory parking, and parking fines required the spending of USD 5.5 million on infrastructure, operations and enforcement. The revenue represented about 5.5% of the city’s total annual budget, or about USD 125 annually per city resident.
The introduction (or increase) of parking charges for public spaces can:
- Generate income for transport operators and/or public authorities that can support other transport services, including public transport or innovative transport modes (European Parking Association countries earned an estimated total of EUR 26 billion in revenue in 2013)
- Reduce parking demand, allowing repurposing of unneeded parking spaces for alternative uses like walking or cycling infrastructure
- Increase the turnover of the most convenient parking spaces, thereby increasing convenience and reducing cruising for parking and associated negative vehicle traffic and related impacts
- Encourage the use of less-convenient parking spaces, such as off-street parking, to spread demand
- Reduce overall vehicle traffic and related negative impacts.
Parking pricing may
- Shift the location of parking demand rather than reduce car use
- Be socially inequitable: higher-income groups are less affected by increased trip costs
- Incite illegal parking or cause parking congestion problems where parking is unpriced (this can be addressed by improving parking regulations, user information and enforcement)
- Discourage commercial activity in favour of areas offering free parking.
ITF (2021) Transport Climate Action Directory – Parking pricing
https://www.itf-oecd.org/policy/parking-pricing
ITF (2020) Transport Climate Action Directory – Parking pricing, weblink
Sources
Bianco, M (2000) Effective Transportation Demand Management: Combining Parking Pricing, Transit Incentives, and Transportation Management in a Commercial District of Portland, Oregon, https://www.pdx.edu/sites/www.pdx.edu.cus/files/DP-006.pdf
Dueker, K. J., Strathman, J. G.and Bianco, M. J (1998) Strategies to Attract Auto Users to Public Transportation. http://onlinepubs.trb.org/onlinepubs/tcrp/tcrp_rpt_40.pdf
European Parking Association (2013) Scope of Parking in Europe Data Collection by the European Parking Association, https://www.europeanparking.eu/media/1180/epa_data_collection_rev.pdf
Gillen, D. W (1977) Estimation and specification of the effect of parking costs on urban transport mode choice. Journal of Urban Economics. Volume 4, Issue 2, April 1977, Pages 186-199, https://doi.org/10.1016/0094-1190(77)90022-5
Hensher, D. A. and King, J (2001) Parking demand and responsiveness to supply, pricing and location in the Sydney central business district. Transportation Research Part A: Policy and Practice. Volume 35, Issue 3, March 2001, Pages 177-196, https://doi.org/10.1016/S0965-8564(99)00054-3
Hess, D (2001) Effect of Free Parking on Commuter Mode Choice: Evidence from Travel Diary Data. Transportation Research Record, Volume: 1753 issue: 1, page(s): 35-42 Issue published: January 1, 2001, https://doi.org/10.3141/1753-05
Hoebergen, A. and van der Beek, P (2014) Parking fee revenues estimated at 660 million euros in 2014, https://www.cbs.nl/en-gb/news/2014/11/parking-fee-revenues-estimated-at-660-million-euros-in-2014
Kelly, J. A. and Clinch, J. P (2009) Temporal variance of revealed preference on-street parking price elasticity. Transport Policy. Volume 16, Issue 4, August 2009, Pages 193-199, https://doi.org/10.1016/j.tranpol.2009.06.001
Litman, T (2016) Parking Pricing Implementation Guidelines, http://www.vtpi.org/parkpricing.pdf
Miller, S. and Wilson, R (2015) Parking Taxes as a Second Best Congestion Pricing Mechanism, https://publications.iadb.org/handle/11319/7290
Ministerie van Infrastructuur en Waterstaat Kennisinstituut voor Mobiliteitsbeleid (KiM) (2018) Effecten van prijsprikkels in de mobiliteit: een literatuurscan http://web.minienm.nl/kim/prijsprikkels/3_0.html
Pierce, G. and Shoup, D. (2013) Getting the Prices Right: An Evaluation of Pricing Parking by Demand in San Francisco, http://shoup.bol.ucla.edu/PricingParkingByDemand.pdf
Shoup, D. and Pickrell, D (1980) Free Parking as a Transportation Problem, https://trid.trb.org/view.aspx?id=162615
Willson, R (1992) Estimating the travel and parking demand effects of employer-paid parking, http://www.sciencedirect.com/science/article/pii/016604629290029Z
Willson, R. and Shoup, D (1990) Parking subsidies and travel choices: Assessing the evidence, http://citeseerx.ist.psu.edu/viewdoc/download?doi=10.1.1.643.4390&rep=rep1&type=pdf
Printer-friendly version