Governance & Policy

Road Pricing

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Definition

Road pricing is the direct charging of vehicles for road use, taking forms such as cordon-based congestion charges (London, Stockholm, Singapore), tolled roads and tunnels, distance-based charges, and low- or zero-emission zone access fees. By pricing scarce road space and external costs — congestion, pollution, carbon — it manages demand more efficiently than fuel taxes can, and generates revenue for transit and infrastructure.

References

tfl.gov.ukBulk import source

Source imported for editorial provenance.

www.itf-oecd.orgBulk import source

This reference provides supporting context for how “Road Pricing” is defined and used.

Overview

How it is used

The instrument structures urban transport demand management, heavy goods vehicle charging (Eurovignette systems), and emerging distance-based charging proposals as electric vehicles erode fuel-tax revenue.

Why it matters

Cities cannot build their way out of congestion; road pricing is the most effective — and most politically instructive — demand management tool available.