The City Council of Milan invited the Agency for Transport and the Environment to research “The introduction of Road Pricing in Milan ” in order to provide a preliminary assessment of the potential impact of such a scheme not only on traffic and mobility but also on the city’
s economy.The study considered the role of a Road Pricing scheme within a framework of wider policy initiatives on traffic planning that the Council had already initiated.

The technical aspects of the study were addressed in collaboration with a team of specialist consultants (these included economists, urban planners, development planners and international experts on traffic control and regulation). A multi-criteria framework was developed to compare alternatives and enable the evaluation to assess the impact of different Road Pricing cordons and tariff levels.

The analysis was focussed on evaluating the introduction of Road Pricing against key objectives set out by the city council:

•  Reduction in road congestion and protection of the city environment;

• Retainment of existing levels of accessibility to the city centre;

• Capability of using net revenue for financing new transport infrastructure.  

The study begun with a global benchmarking review of the Road Pricing experience worldwide in order to consider the lessons learnt against the specific characteristics of the city of Milan.

10 case studies were analysed: Trondheim (implemented), Oslo (implemented), Singapore (implemented), Hong Kong (in development), Bristol (proposed), Rome (proposed), Genoa (proposed), Edinburgh (proposed), Leeds (proposed), London (in development).

Three alternative city cordons were selected for examining the introduction of Road Pricing in Milan (an external one at the city council boundary, a middle one at the Cerchia Filoviaria and an internal one at the Cerchia dei Bastioni).
On the basis of the benchmarking analysis and local experience a range of potential charging levels was selected, this varied from 1 to 3 €. It was felt that higher charges levels could significantly change travel behaviour and transport demand, these were outside the scope of the study and the quantification of the potential impact of higher charges would require deeper and more specific market research analysis.
It was considered that the migration from a low charge to an high charge in the medium to long term could be feasible if this was followed by a parallel improvement in public transport, parking and other access facilities.
On the basis of these considerations, the study evaluated the impact of nine different hypotheses obtained by combining the three cordons with the three charge levels (1€, 2€, 3€).  

 The assumptions adopted for the Road Pricing scheme were as follows:  

• Charging would apply during the period 7am to 7pm, Monday to Friday, in order to exempt leisure journeys carried out in particular after 7pm;

• Potential surcharge for commercial vehicles, both light and heavies (consideration was given to differential pricing for some hours to encourage unloading of goods away from the peak);

• Exemptions for specific categories: emergency service vehicles, taxis, police, vehicles for the mobility impaired etc.;

• Exemption for motorcycles and scooters principally because of technological control issues;

• Maintaining the same charge throughout the charging period for car vehicles (although in the future it could be possible to experiment differential charging based on the time of entering the cordon)

Potential for payment via automated systems as well as registering payment prior to or after (by midnight) entering the charging area  

The assessment of the impact of charging on the city economy showed that this impact grew in relation to the size of the area within the cordon and level of charge. Although the service industry was not expected to be adversely affected by a charging scheme, commercial activities were expected to be affected adversely, at varying degrees, across all the hypotheses tested.
With respect to the real estate market, the office and retail sectors were expected to suffer a negative impact while there would be positive effect on the residential market.

The extent of traffic reduction entering the cordons was expected to be  directly related to the increment in charge charge level. The traffic reduction was forecast to be higher, in percentage terms, within the more internal cordons (upto 15% lower in the peak hour with a 3€ charge at the internal cordon of the Cerchia dei Bastioni). This reduction produced growth in the traffic on the outer distributor roads around the cordon (of around +6%), this kind of traffic created a more negative impact the more external was the cordon and higher was the charge. The congestion reduction was therefore experienced on the flows entering the city but not on orbital movements.

The public transport network could satisfy the demand from new users if the cordon was the Bastioni, but there could be capacity problems with the external cordons expecially with the cordon at the city council boundary. With higher charge levels and less internal traffic, commercial speeds on the radial bus network were expected to increase.

The provision of adequate supply of quality interchange parking facilities was a critical aspect for all the hypotheses considered, in particular for the more external cordons.

The acceptance from the public of Road Pricing was expected in part to be dependent on the use of the net revenues generated by the scheme. It must be clear that revenues gained will be directed at improving public transport and to implement initiatives which in the long term improve the city (metro extensions, upgrades and new lines).

The direct impact on development and the form of the urban area can only be evaluated in the medium long term, on the basis that the charge is continuously monitored and, if necessary, adjusted. Moreover, the potential impact that Road Pricing could have on the choice of location of different urban functions will need to be evaluated taking into account the different timescales required to transform land uses (ie. from commercial to residential and vice versa).

The forecast impact on emissions identified that the largest positive effects would result from the higher charge at the two external cordons (the Cerchia filoviaria and the city council boundary) but there would also be positive impacts within the more internal cordon with the highest charge.

Given the existing characteristics of the road network and average speeds, the changes in overall traffic flows as a result of Road Pricing are not expected to be significant enough to effect the noise levels in any of the hypothesis’ considered.

The recommended technology for the implementation of a Road pricing scheme in Milan is the Telepass system, already widely used and tested throughout the Italian toll motorway network, and about to be implemented in an urban context.

For any car user who does not have Telepass reader on his/her vehicle it is proposed that there will be alternative ways of paying the charge at retail outlets located throughout the inside and outside the charging area. Payment will also be possible via telephone and with credit cards. Toll gates are not enviaged at any of the cordon entry points.

The capital costs of the scheme control system vary from 6.2 million euro for 64 entry locations (79 lanes) at the Cerchia dei Bastioni (the most internal cordon) and 7.1 million euro for 59 entry locations (91 lanes) at the city council boundary cordon to 12.8 million euro for 112 entry locations (157 lanes) at the Cerchia filoviaria (the middle cordon).

The estimates of revenues and the operating costs associated with the scheme, assuming residents within the cordon are exempted from paying, produce incremental net revenue varying from 67 to 198 million euro per year between the Cerchia dei bastioni cordon and the city council boundary with a 3 euro charge.

The timescale for implementating a Road Pricing scheme is about two years starting from a position where the charging area has been defined.
In conclusion, the Road Pricing scenario with demonstrates the largest benefits and least adverse impacts is the one with the charging area limited to the Cerchia dei Bastioni.

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