The ACT party – or at least its biggest funder – was in the news last weekend for expressing some of his views for the party at their annual conference. Of note was this line
“I’d privatise all the schools, all the hospitals and all the roads,” he told the conference.
Now obviously we’re not in the habit of talking about schools or hospitals (unless it’s about how to get to them) but roads are something on our list. Now in reality I can’t see it happening here – at least any time soon – but it raises the interesting question of what would happen if we were to privatise roads? This post is really just a thought exercise as to some of the impacts of doing so.
I suspect that if we were ever privatise the roads the impact would how we get around and our views on transport would change dramatically. There would be some overall impacts across the entire network but also more local impacts due to there likely needing to be different forms of privatisation.
The key impact would be across the entire network and the true cost of operating, maintaining and building roads would become much clearer regardless of how that’s passed on to the public. A better understanding of just how much roads cost, especially if charged for through forms of road pricing would lead to changes in how people travel. People would likely reduce the amount of driving they do in favour of more walking, cycling and PT use.
Private road owners would also likely seek to reduce their maintenance costs while users of lighter vehicles would likely demand that costs are more fairly distributed to those that do the most damage. That in itself could have large impacts. It would likely see the vehicle fleet get smaller and lighter over time i.e. less people would be driving around in large SUVs unless they absolutely need too (or want too). Truckies would be even harder hit. Due to their weight, trucks cause substantially more damage to road surfaces and so would likely be charged substantially more than other vehicles which in itself would have far reaching impacts by pushing up delivery costs. Those increased costs would of course be passed on to businesses and ultimately consumers.
Perhaps one of the areas most impacted would be in road construction. In short it would kill it dead. Most transport projects simply don’t make sense financially and the toll road troubles in Australia are proof of this. Traffic volumes often don’t stack up and most projects are only able to be justified based on the benefits to the wider economy from improved travel times. Faced with paying for a journey in time through congestion or paying a monetary cost to avoid congestion, many choose the former. What all of this means is that road construction would dry up almost immediately and the costs would shift to making the best use of the infrastructure that exists. That could have some negative consequences as there might be little attention paid to improving roads through projects like this. The flip side of this is that the private road owners would likely become liable for road safety and therefore be a push to improve crash black spots.
Regardless of whether privatising roads is a good or a bad thing, one thing that isn’t so clear is just how it could be done. The real benefit from roads comes from the fact they are an extensive network. Very few trips begin and end on the same road and a trip might commonly involve travelling on quieter residential streets, arterial roads and motorways. Each of those would present vastly different opportunities for privatisation.
Motorways would probably be the easiest roads to privatise due to the fact they have limited access and all journeys that use a motorway begin and end somewhere else. Motorways also carry large amounts of traffic each day. This is also why groups like the NZCID who have been pushing for the council/govt to find additional ways to fund ever more and larger transport projects have suggested charging for access to the motorways. If we were to privatise roads there would likely be a big temptation to do the easiest ones first and so motorways would be at the top of the agenda. The problem with that though is that it would likely have a huge impact on but still publicly owned roads.
The next easiest set of roads to privatise would actually be quiet suburban streets, particularly those post 1950′s suburbs full of cul-de-sacs. There we would probably do something similar to what is likely to happen later this year in the small sprawly village of Long Grove (north of Chicago). They are looking to privatise many of their currently public suburban roads because it simply can’t afford to maintain them due to their pyramid scheme like system of how roads were funded where the money to pay for them was only raised through development contributions which dried up as a result of the GFC. They are simply going to turn over the ownership of the roads to the owners of the houses on the street and leave it up to them to maintain.
Some typical post 1950′s street patterns
That could put big strains on neighbourly relations in many places as people work out who will pay for what i.e. does everyone on a street pay equally or do those at the end of the street pay more? In some parts of Auckland there could be interesting changes in the stance taking on intensification. More people living on a street means more people to share the cost of a road with and so some of the suburbs that were most opposed to intensification in the Unitary Plan discussions might quickly change their mind. Going further some residential neighbourhoods might start imposing restrictions on vehicle use in their streets – particularly truck movements – in a bid to lessen the damage vehicles do to the roads. Gated communities might also become more common to stop others from passing through.
On the positive side these communities are likely to become much more pedestrian and cycle friendly as those two modes cause much less wear and tear on roads which equates to less maintenance.
Privatising arterial roads are likely to be the hardest to do because not only do they serve a movement function but they serve a place one too, people live, work and play along arterials. To be honest I don’t even know how you could privatise them as due to their function they can’t just be turned over to locals to maintain but their connected nature means they would be prohibitively expensive to charge for. Who would really want the cost and hassle of owning them?
Overall I don’t think the idea of privatising roads is necessarily a bad one from an ideological perspective and doing so would certainly change how we use roads, including what modes we use but overall it simply isn’t practical. Roads are such a key part of our everyday life that changing our relationship with them – however flawed it currently is – would have radical and far reaching consequences for society, probably far more so than the privatising of many other government functions. As such I would suggest the likelihood of it happening is very very low. Far more likely and practical would be the introduction of proper road pricing.
An article on Planetizen a few months back highlights an issue often missed in the debates over roads versus public transport or sprawl versus intensification – the fact that for the last century most government spending and policy has supported car use and lower density development. Yet this is seemingly often ignored by those moaning about how planners are supposedly ’forcing’ people into dense living environments while transport planners are supposedly ‘forcing’ people onto public transport.
Michael Lewyn, the post’s author, asks an interesting hypothetical question to set up his argument that really public investment and policy (essentially public sector intervention) has for an incredibly long time been tilted towards urban form and transport outcomes epitomised by car dependent urban sprawl:
After reading yet more blather about the “war on cars” or “density-pushing planners” I recently had a thought: what if government really did favor transit and compact development as aggressively as they had favored sprawl in the 20th century? How different would planning and transportation rules be?…
For example, in the first half of the 20th century, government at all levels spent public money on roads for automobiles, while giving limited or no support to streetcars (which at first were private). As transit providers began to lose money, government took them over, and the federal government started to support public transit in the 1960s. Today, the federal government spends about four times as much on highways as on public transit. As a result of these policies, many cities have weak public transit systems, while many people and jobs have moved to suburbs served by highways.
This cartoon from Andy Singer springs to mind (he has a heap of other great cartoons on many of the issues we talk about on the blog)
Some examples are then outlined to give us a bit of an idea about how extremely pro public transport and urban intensification policies would need to go in order to truly counter-balance what has existed for around a century in the USA (and in New Zealand). For transport funding:
So if government completely reversed course in the 21st century, it would reverse funding ratios: that is, spend half a century spending several times as much on public transit as on highways, and then spent another half century completely defunding highways (much as it ignored transit in the early and mid-20th century).
For how mortgages for greenfield development were subsidised:
In the 1950s, government heavily subsidized suburbia, through Federal Housing Administration (FHA) lending criteria that favored suburbs. For example, FHA refused to subsidize mortgages in racially diverse urban neighborhoods, and favored new single-family homes (which tended to be in suburbs) over renovating existing homes- a policy that encouraged middle-class homeowners to move to suburbs. So to completely reverse course, the FHA would have to spend a couple of decades refusing to insure mortgages in any neighborhood built after the New Deal, while subsidizing mortgages in older neighborhoods.
For density controls:
Since the 1920s, most American zoning codes have mandated that huge swaths of land be limited to low-density residential use, ensuring that many Americans do not live within walking distance of public transit. To truly reverse this policy, government would have to spend the 21st century mandating that new development be at densities sufficient to support transit, and would require a mix of residential and commercial uses to the extent possible.
And how about parking?
Since the 1950s, most zoning codes have also required that commercial landowners and multifamily dwellings provide visitors with parking lots and garages, thus effectively subsidizing driving by making parking more abundant. And because zoning codes also required buildings to be set back from the street, these parking lots were usually in front of buildings, thus ensuring that pedestrians must waste time walking through ugly parking lots in order to reach their destinations. To reverse this policy over the next 60 years, government would have to establish maximum parking requirements (as a few cities have in fact done) and require buildings to be in front of sidewalks so pedestrians could reach them more easily.
Of course this is just a series of hypothetical questions, which highlight that many of the changes to land-use and transport planning that we promote on this blog: things like removing parking minimums, removing/lessening controls that limit development density and promoting a better balance between public transport and road spending are really pretty mild and attempt to shift planning policy and transport spending back much more towards a ‘neutral’ situation. If we really were promoting bias towards intensification instead of sprawl, public transport instead of road spending, that was to the same extent (but opposite direction of course) as what has happened in the past century – we’d have to be WAY more extreme.
Bill English has provided a fairly blunt but accurate explanation of the issues with urban development in Auckland. Interest.co.nz reports
With respect to so-called urban sprawl, I think that’s a nonsense. If you’re against urban sprawl and that means lower to middle income Kiwis can’t buy a house and you can’t build an apartment in the middle of Auckland for less than NZ$600,000, then that’s too high a price to pay. And if it means driving up house prices in a way that wrecks the economy then that’s too high a price to pay,” he said.
“Funnily enough the people who are most worried about urban sprawl live in the middle of the city. They don’t get to see it. How much time to they really spend out the end of the Western motorway or Botany? None actually. They think you should be able to walk to the countryside. Well…welcome to Gore. If you’re really mad, that’s where you should go. But they don’t. They stay in Auckland Central,” he said to laughter from the audience.
“What’s actually happened is that the local authorities were keen for a denser city, but the inhabitants weren’t, so they’ve jettisoned a fair bit of the densification aspect,” he said.
“So if Auckland wants to grow now, it has to grow out because you don’t want it to grow up. Now that’s a fair choice, but please don’t stop it from growing out as well, otherwise we’ll get another few years of 15% house price growth and you get a real mess when it crashes,” he said, adding the special housing areas agreed under the Housing Accord with the Auckland Council “do spread the city because the planning rules don’t let you do anything else.”
“We’re indifferent as a government as to whether you grow up or out. But you said don’t grow up, so we expect to help you grow out.”
I don’t think that all government ministers were indifferent as to whether Auckland develops up or out but from I’ve seen Bill didn’t seem too concerned with either option. As for his other comments though, he is quite correct, if intensification isn’t allowed then the only option would be to sprawl. I think it’s a message that many of those opposing intensification completely ignored.
What I don’t agree with him on is that an apartment can’t be built for less than 600,000. Many of the projects on our development tracker are certainly well under that price.
Don’t forget to make a submission on the Unitary Plan if you haven’t already they close tomorrow afternoon.
It’s almost as if Brian Rudman had been reading the blog (I’ve heard that he does).
Labour’s Auckland issues spokesman, Phil Twyford, says Labour now backs Mayor Len Brown’s bid to levy an extra charge on Auckland road users through road or congestion charges or a regional fuel tax.
He said Labour had been wary of road-user charges in the past because of the effect on working Aucklanders, but now says they are already paying a high price for congested roads and lack of public transport.
But by buying into Mr Brown’s road-bloated transport plans, Labour is only preventing the short sharp shock in favour of public transport that is long overdue. Of course the city rail tunnel is a no-brainer. As was the electrification of the rail network, integrated ticketing, revision of the bus networks and the other public transport reforms which, let’s not forget, pre-dated Mr Brown’s emergence as chief cheerleader.
The problem is the $12 billion to $15 billion that Mr Brown wants to raise via road charging and tolling is needed only because of a huge funding shortfall in Auckland Transport’s proposed 30-year “integrated transport programme”.
It’s a flawed, road-dominated programme which, if achieved as planned, will leave the next generation of Aucklanders stuck in worse traffic jams than we have now. The plan admits that once it is completed, “road congestion levels will deteriorate with volume/capacity ratios exceeding 100 per cent on most of our arterial road networks by 2041 and emission levels exceeding current levels”.
Despite all the mayor’s promotion of his rail tunnel, the underlying emphasis of this grand plan is still on roads. This is underlined in the regional land transport programme.
This is what we’ve been saying for almost a year now. Personally I think that road pricing should take place but not as a revenue gathering exercise but for the congestion relief benefits it provides. To do this it could be done in a revenue neutral way by reducing household rates instead. It is the rubbish Integrated Transport Programme that was one of the driving factors behind us creating the Congestion Free Network which does include still building a substantial number of roading projects but not to the same scale as currently proposed. We’ve even estimated the costs out over each and every year.
Aucklanders have proven that given a train service, they will use it. In 1993, after the purchase of Perth’s secondhand diesel fleet boosted Auckland’s puny rail service, passenger numbers rose from 1 million to 2.5 million over 10 years. In the 10 years after the opening of the Britomart station in 2003, passenger numbers quadrupled to 10 million.
The first of the 57 new electric trains will enter service in April. With the new Hop card integrated ticket finally operating and a redesigned network of bus routes in the wings, Auckland public transport is finally emerging from a half-century of neglect. With the improved train services and the Northern Busway, Aucklanders have voted with their feet. Provide a service and they will use it.
The trouble with the politicians and the bureaucrats is that after 60 years of addiction to petrol, they can’t break the habit. True, they’ve conceded that a liveable city needs a modern public transport system. But when did you ever see a politician on a bus or train – except for a photo opportunity?
More to the point, when did you see one vote to chop the roads budget in favour of public transport? Instead they try to support both, which is why Mr Brown and the “consensus building group” of mainly road-lovers he set up to find new funding is trying to bully Aucklanders into paying another $12 billion to $15 billion for a 30-year plan that’s designed to fail.
There are a few politicians that do use PT. The most prolific is actually George Wood who I know uses it to get all around the region and not just for getting to and from the CBD, even doing trips that most readers wouldn’t bother attempting like yesterday when he used PT to get from the Airport to the North Shore.
Yesterday the NZCID also released an “independent report” on infrastructure. I haven’t read through it yet but some of the comments in the press release definitely caught my eye.
However, SGS found that the Auckland Plan objective of a quality compact city was unlikely to be achieved without increased investment in city shaping infrastructure, identification of the means to fund that investment and policy reform to support road pricing and value capture mechanisms.
On current plans there simply is not sufficient investment in transport infrastructure to support a transition to an efficient and competitive higher density urban form, Selwood said.
To reverse many decades of low-density, motor-vehicle oriented growth will take much more than the city rail link and other projects prioritised in the Auckland Plan.
This finding helps explain why transport modelling of future land use and transport investment completed last year showed Aucklands congestion worsening significantly over the course of the next thirty years, even with all proposed investment committed.
So how does this plan look for some city shaping infrastructure that helps us transition to an efficient and competitive higher density urban form that will help to reverse many decades of low-density, motor vehicle oriented growth?
Edit: Also worth including a couple of comments from Phil Twyford on the issue
It seems Len Brown is trying to rebuild his image in part by being a man of action and getting things done. Now that in itself isn’t necessarily a bad thing, especially if focused in the right direction and while Len is pushing some things well, like the City Rail Link, in other areas I think he seems almost desperate to do something that he could end up doing more harm than good. His “Transforming Auckland’s Economy: State of Auckland” speech this morning had a number of interesting points, some I thought were good, others not so. Bob Dey has the full speech here.
Thirdly, we need to build a reputation as a modern, wired city. In this regard, there have been too many excuses & delays in rolling out ultra-fast broadband and providing decent wi-fi.
Auckland Council will be developing a Digital Auckland – kick start programme so we are playing an active role in picking up the pace in this area. My intention is that this will include working with business partners to roll out free wi-fi in public places & public transport and finding commercial partners to help expedite the rollout of ultrafast broadband.
I see connectivity is increasingly important and rolling out wi-fi to more areas, especially in public areas and on PT is a good idea. Already increased communication is being seen as a critical element in some of the changes we are seeing with transport as young people who want to spend more time online can do that on a bus/train much easier than they can behind the wheel and was cleverly picked up for this AT ad.
Fourthly, we need to begin to make public-private partnerships part of how we deliver largescale projects. At the end of last year the council & I agreed a way forward for the SkyPath project – a walk & cycleway across Auckland’s harbour bridge.
The SkyPath will be Auckland’s first PPP, and will eventually enable a great vision – a cycle & walking path stretching from St Heliers to Devonport. This will act as a real game changer for building pedestrian & cycleways around our city. This is a chance to cut our teeth on PPPs and show that we can deliver real value for money and better outcomes for ratepayers.
PPPs are not a free ticket to be clipped by the private sector. We need to use our considerable scale & position to nail down the best possible deals for Aucklanders, learning the lessons from international experience and retaining public ownership.
Beyond the SkyPath, there will be major opportunities for transport projects, including the city rail link, better waste management & other major transport projects.
This is where I have the biggest concern with Lens push. Many of the projects he’s talking about like Skypath and the City Rail Link are critical but the reality is most of the funding shortfall is going to require additional funding sources is being created other large roading projects. Just because you could build them as a PPP doesn’t suddenly make them a better project. That’s one of the reasons behind why we are so focused on the Congestion Free Network. Before we consider how we fund projects it’s important that we go through a process and actually work out what we need to build i.e. what will work. After we have done that we can start looking at how to fund stuff and PPPs might be part of that. In fact of all of the projects on the list perhaps the one most likely to succeed as a PPP would be the CRL as it does allow private business to work in with the construction through activities like additional retail.
In all of this it is pleasing to see Len becoming increasingly positive about Skypath, something he had been a bit quite on for a while.
Many times in the last few years we have highlighted a ‘flat-lining’ or at least slowing of growth in car travel across New Zealand. The same trends have been seen in many overseas cities and countries – with the slowing in the UK dating back at least 20 years now. Yet for some bizarre reason this change hasn’t filtered through to those making projections about future traffic growth. In the UK we have seen projection after projection forecasting significant growth – even though consistently it doesn’t happen.
The same process has happened in Washington state, where the Department of Transportation has ignored the flat-lining of traffic growth and continued to forecast significant increases – despite all evidence suggesting they need to change:
Lance Wiggs has picked up on a recent report released by Treasury that looks into the evidence behind the key elements of the transport sector. Towards the end of the report Treasury analyses some projections of future transport demand prepared by NZTA and NZIER. Let’s let Lance pick up the story here:
This line records use of a certain item by New Zealand population since 2000. Where do you think it will be in say 20 years time?
The statistic went up, and then down, and so the best estimate to me would be a flat or downward trend. But rather strangely the authors of this chart determined that all of their estimates would be up, and that the lowest change would be a substantial increase. Here it is, with my added red line eyeball trend:
The chart, of course, is estimated vehicle use in New Zealand, expressed in millions of kilometres travelled. It’s sourced from the “ National Long-Term Land Transport Demand Model, NZIER and NZTA (2013)”, and that’s a critical model as it feeds into all sorts of cost-benefit analysis and policy for transport in New Zealand.
The data is sourced from this report, which appears to make the same mistakes as transport modelling projections in the UK and Washington state have done for the past 20 years – by refusing to believe that anything ever changes about how people travel. Even though evidence to the contrary is absolutely everywhere. Similar bizarre conclusions are made about future levels of public transport use. Back to Lance:
The bias towards cars is also reflected in this chart of forecast public transport statistics – which doesn’t pass the giggle test either. Witness the trend and the projections below (the red is my version of the trend-line):
So for some unfathomable reason the growth in the use of public transport is forecast to immediately and dramatically fall, while the growth in the use of cars will immediately and dramatically rise. It’s ludicrous.
What’s interesting is that a footnote in the Treasury paper notes that these projected trends are completely at odds with what has been happening in recent years. It says:
We note that, although the NZIER / NZTA model predicts a gradual decline in the future, the public transport share of passenger kilometres has shown a steady growth trend over the past decade. This may merit further monitoring and consideration as time progresses.
It seems that at least the public transport projections are a little bit too insane for even Treasury to believe.
In any other area of government activity or a business if the computer models were projecting the complete opposite of what’s happening, what’s been happening for quite some time and what’s happening in cities and countries all over the world, we’d chuck the models out and start again. Yet for some reason we keep believing these illogical outputs and use them to determine where and how to spend billions of dollars of public money. It’s quite disgraceful really.
An article in the New York Times a few months ago summarised quite nicely recent research into connections between transport modes and health outcomes:
Millions of Americans like her pay dearly for their dependence on automobiles, losing hours a day that would be better spent exercising, socializing with family and friends, preparing home-cooked meals or simply getting enough sleep. The resulting costs to both physical and mental health are hardly trivial.
Suburban sprawl “has taken a huge toll on our health,” wrote Ms. Gallagher, an editor at Fortune magazine. “Research has been piling up that establishes a link between the spread of sprawl and the rise of obesity in our country. Researchers have also found that people get less exercise as the distances among where we live, work, shop and socialize increase.
Obviously there’s nothing really new in the fact that obesity creates significant health problems and that our car dependent lifestyles have created a culture where people have to go out of their way to exercise – and therefore many just don’t get around to it. What’s perhaps most interesting though is just how related obesity rates and other health problems appear to be with our urban form and our transport choices:
“In places where people walk more, obesity rates are much lower,” she noted. “New Yorkers, perhaps the ultimate walkers, weigh six or seven pounds less on average than suburban Americans.”
A recent study of 4,297 Texans compared their health with the distances they commuted to and from work.It showed that as these distances increased, physical activity and cardiovascular fitness dropped, and blood pressure, body weight, waist circumference and metabolic risks rose.
The report, published last year in The American Journal of Preventive Medicine by Christine M. Hoehner and colleagues from the Washington University School of Medicine in St. Louis and the Cooper Institute in Dallas, provided causal evidence for earlier findings that linked the time spent driving to an increased risk of cardiovascular death. The study examined the effects of a lengthy commute on health over the course of seven years. It revealed that driving more than 10 miles one way, to and from work, five days a week was associated with an increased risk of developing high blood sugar and high cholesterol. The researchers also linked long driving commutes to a greater risk of depression, anxiety and social isolation, all of which can impair the quality and length of life.
It’s not just in the US, similar results come from a Swedish study:
A Swedish study has confirmed the international reach of these effects. Erika Sandow, a social geographer at Umea University, found that people who commuted more than 30 miles a day were more likely to have high blood pressure, stress and heart disease. In a second study, Dr. Sandow found that women who lived more than 31 miles from work tended to die sooner than those who lived closer to their jobs. Regardless of how one gets to work, having a job far from home can undermine health. Another Swedish study, directed by Erik Hansson of Lund University, surveyed more than 21,000 people ages 18 to 65 and found that the longer they commuted by car, subway or bus, the more health complaints they had. Lengthy commutes were associated with greater degrees of exhaustion, stress, lack of sleep and days missed from work.
Fortunately it’s not all bad news though. The trends we’re seeing with fewer young people getting driver’s licenses than earlier generations, contributing to the general decline in per capita driving over the past 7 or so years offer some hope to researchers that perhaps we’re finally “turning a corner” on many of these trends:
In her book, Ms. Gallagher happily recounts some important countervailing trends: more young families are electing to live in cities; fewer 17-year-olds are getting driver’s licenses; people are driving fewer miles; and bike sharing is on the rise. More homes and communities are being planned or reconfigured to shorten commutes, reduce car dependence and facilitate positive interactions with other people.
Dr. Richard Jackson, the chair of environmental health sciences at the University of California, Los Angeles, says demographic shifts are fueling an interest in livable cities. Members of Generation Y tend to prefer mixed-use, walkable neighborhoods and short commutes, he said, and childless couples and baby boomers who no longer drive often favor urban settings.
While there is still a long way to go before the majority of Americans live in communities that foster good health, more urban planners are now doing health-impact assessments and working closely with architects, with the aim of designing healthier communities less dependent on motorized vehicles for transportation.
Now, about that Unitary Plan that enables a huge amount of sprawl and the Integrated Transport Programme loaded up with poor value roading projects.
When it comes to the debate around sprawl, intensification and housing affordability one of the most persistent arguments for opening up more greenfield land is that land costs at the edge of town are much cheaper and therefore opening it up for development can help in making houses more affordable. We’ve long argued that the looking at the costs of housing alone is only telling one part of the story and that we really should also be taking transport costs into account.
An article in the herald yesterday highlighted that a study on exactly that based on Auckland that had just been published (you’ll need to purchase the paper to be able to read it). The herald writes about it.
Migrating to the outer suburbs may not be the affordable dream many Aucklanders believe, according to a new study which lays bare the true cost of commuting.
Researchers have for the first time created a detailed picture of housing affordability in New Zealand’s largest city when commuting costs are factored in, with surprising results.
One calculation showed that the most affordable homes could even be found in some inner areas of the city.
“When you take into account that people in outlying areas are so much more dependent on automobiles than people in inner-city neighbourhoods, transport costs should play a role in what locations we consider to be affordable or not,” study co-author Kerry Mattingly said.
The researchers created two separate income-based indicators to measure combined commuting and housing affordability across different suburbs of Auckland.
This stands in stark contrast to measures considering housing costs in isolation, which show affordability generally improves with distance from the centre of the city.
One of the indicators, which they said presented a more accurate picture of how affordable an area would be for a typical family to live in, found the most affordable areas were found in the lower central, inner-west and inner-south of Auckland.
Areas close to employment hubs appeared relatively more affordable using the measure due to modest expenditure on commuting.
In some peripheral areas, average annual commuting costs could be five times the amount shouldered by those living in many central Auckland neighbourhoods.
The study highlights that there’s no point in just building a heap more housing out on the urban fringe as that alone won’t make housing more affordable primarily due to people having to drive further. To me this result is completely unsurprising and shows we need to be much smarter about how we develop out city if affordability is something that people are actually concerned about.
Amazingly I have seen some people suggest that without having read it, the study is flawed because it focuses only on people travelling to the CBD however actually reading through the paper shows that this completely false. Using the 2006 census data the researchers looked at individual area units within Auckland, where the people within them were travelling to for work and what mode they used. That means someone travelling to the CBD is treated exactly the same as someone travelling to a different part of Auckland.
Yet despite how detailed the researchers have been there are a still factors that haven’t been taken into account that would likely further impact on affordability. For example parking costs aren’t taken into account and the calculations only take into account the distance travelled, not the time travelled. Both of these are likely to further favour areas where there good PT, walking and cycling connections.
Here’s one of the maps showing housing affordability compared to median income however once again you’ll need to buy the paper to see all of them.
“If you just look at housing costs alone, outlying areas appear really affordable and it initially seems to make sense to say, hey, let’s open up greenfield sites on the urban periphery and develop here,” Mr Mattingly said. “But when you include these broader costs, they are not as affordable as they seem.”
He said the results went against the traditional notion of “drive ’til you qualify”.
When wider social impacts such as increased pollution were taken into account, low-density, urban-fringe expansion was even less ideal, he said.
While increasing the supply of housing may well help to lower the cost of housing, Mr Mattingly said it was the way in which supply was improved that was important.
“In particular, the location and density of residential development will have strong implications for associated transportation costs, combined housing and transport affordability, and long-term environmental sustainability.”
Policy-makers needed to consider the relationship between housing and transport, and strike a balance between an adequate supply of land for development and intensification.
It’s certainly an interesting paper and something I’ve wanted to see more data on for a while so thank to the authors for doing this. The timing is also good being just before the unitary plan submissions close.
Len Brown made a big deal in his first term about making Auckland the world’s most liveable city and projects like the CRL are key to that vision. But when it comes to business and Auckland’s economy is that vision worth it or should we instead be focused on keeping rates as low as absolutely possible – as the likes of Cameron Brewer would have us do.
Well a study just released out of the US suggests the focus on liveability is exactly what we should be doing if we want to build the economy and attract entrepreneurs. Richard Florida writing at the Atlantic Cities:
Creating high-growth, high-impact entrepreneurial enterprises has become a common goal of cities. Metros and states have cut taxes, implemented entrepreneur-friendly business policies, launched their own venture capital efforts, and underwritten incubators and accelerators – all in the hope of creating the next Apples, Facebooks, Googles, and Twitters.
But what really attracts innovative entrepreneurs who create these economy-boosting companies?
The answers: talented workers, and the quality of life that the educated and ambitious have come to expect – not the low-tax, favorable-regulation approach that many state and local governments tout.
These are the findings in a new report from Endeavor Insight, the research department of the non-profit Endeavor, which focuses on fostering and mentoring “high-impact” entrepreneurs. Based on surveys and interviews with 150 founders of some of the country’s fastest-growing companies, the report answers the basic question, “what do the best entrepreneurs want in a city?” It offers basic evidence that cities should focus on factors and conditions that attract the talented, educated workers that fast-growing entrepreneurial enterprises need.
Looking at this sample of America’s most successful new businesses, Endeavor identified two fundamental patterns.
For one, size matters. These top business-creators gravitated towards cities with at least a million residents in the metro area. This offered the scale and diverse array of offerings needed to attract talent.
A city also needs to be able to appeal to the young and the restless. The entrepreneurs surveyed were a highly mobile bunch when they first started out. They moved often and easily in the early phases of their careers, following personal ties or certain lifestyle amenities while also seeking the right environment to launch their enterprises. But eighty percent of respondents had lived in their current city for at least two years before launching their companies, meaning that cities had to catch them early. And once they started their first company, these business leaders rarely moved. So attracting this mobile group at an early age is key.
That talent is the most important aspect is common sense but the key is that it’s much easier to attract talented workers to an liveable city than one that’s not – although in Auckland’s case we probably have to be even more liveable to make up for our geographic isolation. Of course the idea that talent is key is something many larger businesses have understood for some time and in a local context it’s one of the reasons behind a number of big corporate office developments in recent years. EY is one of the companies that falls into that bucket and this video from just over a year ago talks to some of these factors for why they chose to be where they are.
Other important factors included access to transport networks and proximity to customers/suppliers. And at the bottom of the list of most important
Perhaps even more interesting from the perspective of urban policy are the location factors that did not make the cut – those that high-growth entrepreneurs found to be of little consequence in their location decisions. At the very bottom of the list were taxes and business-friendly policies, which are, unfortunately, exactly the sorts of things so many states and cities continue to promote as silver bullets. Just 5 percent of the respondents mentioned low taxes as being important, and a measly 2 percent named other business-friendly policies as a factor in their location decisions.
To drive this point home, Endeavor tracked more than 100 of the most common descriptive words that entrepreneurs used to answer the question, “Why did you choose to found your company in the city that you did?” Tax doesn’t make the top 50, falling below “rent,” “park,” “restaurants,” and “schools.” In fact, it barely manages to edge out the word “girlfriend.” Of the top ten most popular words, “lived,” “live,” and “living” all make the cut. Talent takes the first slot.
Here’s the list of the top 100 words.
Of course having a vision for the most liveable city is one thing, it’s a completely different thing to actually deliver on that and that’s something that’s still seems a long way off in Auckland.
So, electric vehicles (EVs) were looking pretty good in part 2. They’re much more energy efficient than regular cars, at least on a “tank-to-wheels” basis. Today, I’ll talk about their greenhouse gas emissions, starting with a quote from my thesis:
Advanced vehicles could make a sizeable contribution to emissions reduction in New Zealand. BEVs generate zero tank-to-wheels greenhouse gas emissions, and PHEVs only produce emissions when using their internal combustion engines. However, the well-to-wheels emissions for advanced vehicles depend on the source of electricity used to charge the vehicle. These sources, of course, vary substantially between countries, with many countries generating the bulk of their electricity from coal or oil. In fact, for countries such as the US, UK, China and Australia, Matthew-Wilson (2010) estimates that the Tesla Roadster BEV would actually produce higher well-to-wheels CO2 emissions than the conventional Lotus Elise on which it is based. Doucette and McCulloch (2011) and de Sisternes (2010) reach similar conclusions.
As such, the potential for PHEVs and BEVs to reduce greenhouse gas emissions depends on low-emissions sources of electricity. For much of the world, a shift towards these electricity sources will be needed if advanced vehicles are to play any part in reducing emissions. The difficulties in doing so would be one reason for The Boston Consulting Group’s (2009, p. 2) argument that conventional vehicle “technologies will be the most cost-effective way to reduce CO2 emissions on a broad scale”.
I want to highlight the end of that first paragraph. For many of the world’s largest economies, EVs wouldn’t actually reduce emissions at all, based on the current mix of power generation. Indeed, they could even increase emissions – in which case, what’s the point? True, they could help with energy security and wean countries off expensive oil imports (things I’ll look at in future posts), but there’s a lot of cost involved in buying into the technology, installing infrastructure and so on.
In order for EVs to reduce emissions, there will have to be a major shift in the way the world generates power. And, while renewable generation is growing, it still makes up a tiny fraction of the world’s electricity supply.
The New Zealand Situation
Back to New Zealand, where things look a bit better:
Of course, New Zealand is in a much more favourable position, with a large renewable electricity base. The New Zealand Government (2007, p. 22) points out that our “energy resources are plentiful and cheap by world standards… it is easier for New Zealand to commit to a low emissions electricity system than almost any other country”. As shown below, we can reduce our emissions significantly by transitioning to advanced vehicles. Matthew-Wilson (2010) estimates that in New Zealand, a Tesla Roadster would create less than one-third the CO2-equivalent emissions of a Lotus Elise.
I made my own calculations as well, and found that:
“A BEV using 20 kWh of electricity per 100 km of travel would produce emissions of 3.9 kg of CO2-equivalent emissions over this distance, a well-to-wheels measure. This is around 17% of the level of emissions produced by a typical petrol car, illustrating the potential for major emissions savings”.
Indeed, if New Zealand transitions to having more renewable electricity (we’re currently a little over 70% renewable, with aspirational targets of 90% by 2025), those emissions will drop even further. Emissions could become essentially negligible for electric cars, or trains or buses for that matter.
EV emissions – great for NZ, not for most other countries
Yes, electric cars could make a big difference to New Zealand’s greenhouse gas emissions. However, that’s not the case for most countries. We’ve got plenty of renewable electricity, but most countries don’t, and that means their power plants have much higher emissions. This means that most countries have a lot less to gain from implementing EVs.
This is a major issue, because New Zealand is a tiny market in the scheme of things. The availability and price-competitiveness of electric cars will be determined by much larger markets – where the case for switching to advanced vehicles is much weaker. As such, prices will not fall as quickly as they would if all countries had low-emissions electricity systems, and there might not be as many different models and variants available. This will slow the uptake of PHEVs and BEVs in New Zealand as well.
So, it’s been clearly established that EVs can reduce emissions in New Zealand at least. There are still some questions around whether they are the most cost-effective way of reducing emissions, and whether our power grid can handle them – and those things will need to wait for another day.