Tuesday, August 17, 2010

Tolling Cross-Harbour Tunnels in Hong Kong

has become a hot issue lately. Specifically, the Western Harbour Crossing –one of Hong Kong’s three Victoria Harbour crossing tunnels-- is increasing its toll rate.

“Fees for private cars, taxis, and light buses using the Western Harbor Tunnel (WHT) will increase HK$5 to HK$50, HK$45, and HK$60 respectively, and single-decked buses and double-decked buses will each see HK$10 and HK$13 toll rises”

“The company faces increasing operating costs and need to raise sufficient cash flow to repay debts and earn a reasonable return. To ensure continuous viability, the company needs to adjust the level of its tolls”.

The Western Harbour Crossing is private, unlike the Cross Habour Tunnel which has been operated by the government since it was built in 1972. What’s the issue? The issue is that all three cross habour tunnels have different toll rates. Instead of discussing the price differences between types of transport modes, I will use “private cars” to illustrate the rate difference:

Eastern Harbour Crossing (private): $25 per car
Cross Harbour Tunnel (CHT): $20 per car
Western Harbour Crossing (private): $50 per car

For more info see here.

Which one do you think has the highest usage? You probably guessed correctly, the CHT. I live fairly close to the tunnel and have witnessed the egregious traffic congestion. Indeed, its capacity is 78,500 and it has over 120,000 cars passing through it everyday. The Western Harbour Crossing has about 50,000 cars go through it everyday and a capacity of 118, 000.

From reading the newspaper it is quite evident that the public is not content with the toll increase. They argue that it is already too high and hence why the western tunnel is severely underused. Given that the CHT is used the most –because it is the most central, convenient and cheapest—the City needs to figure out a way to redistribute traffic to increase efficiency and alleviate the pollution problem associated with idling cars around the CHT. The government could also choose not to intervene and let the market take care of itself. Overtime, it’s possible that people will adjust and start using the western tunnel because of their frustration with congestion and long-waiting times at the CHT.

But, a toll increase could risk even fewer cars using the tunnel. Usually, if you want to increase demand and usage of a road/tunnel, you lower the price, not increase it. There have been many solutions put forward by HK citizens. The one that makes the most sense is a peak hour tolling system for the CHT. In short, the busiest hours in the morning and evening would have a higher toll rate simply for the purpose of decreasing traffic congestion. Despite Hong Kong's impressive public transit system, there are still a lot of cars on the road. While peak hour pricing may seem like a progressive idea, it certainly has merit and could complement Hong Kong’s sustainable development goals.

We need to keep three things in mind (or more) when we talk about tolls. 1) Prices must be adjusted to maintain an optimum speed for reducing pollution. Intense traffic congestion at the CHT means long line-ups of cars and a greater concentration of pollution. 2) Drivers using the shortest and most convenient route should pay for the privilege. As mentioned, the CHT is the most convenient because it is centralized; thus it should definitely be priced accordingly. 3) Extra revenue from the increased tolls could be used for the replacement of new buses with cleaner fuel or to subsidize private tunnels like the western tunnel to help with traffic redistribution.

Last, toll increases also risk fare increases for taxis and mini-buses. These methods of public transport also use the cross harbour tunnels. Thus, toll increases produce ripple effects that could be mitigated with some sense of progressive imagination.

Key message: Hong Kong has three cross harbour tunnels that have different toll rates. They also have drastically different rates of usage. Introduce peak hour pricing for the most congested cross harbour tunnel as an experiment to see what happens.

No comments:

Post a Comment