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Air Pollution Emissions, 2008 (thousand tons)
Pollution Costs of Urban Transportation
Philip A. Viton
February 9, 2012
Source
NH3
CO
NOx
PM10
PM2.5
SO2
VOC
Total emissions
4,043
77,685
16,339
14,805
4,892
11,429
15,927
Fuel combustion
stationary sources
Industrial processes
Highway vehicles
O¤-highway
Miscellaneous
58
206
308
3
3,457
5,283
3,737
38,866
18,036
11,731
5,597
1,047
5,206
4,255
260
1,330
1,461
171
304
11,540
1,006
751
110
283
2,742
9,872
1,025
64
456
85
1,450
7,142
3,418
2,586
1,332
7.6
50.0
31.9
1.2
2.2
0.6
21.5
Highway contrib. (%)
Key: NH3: ammonia; CO: carbon monoxide; NOx: oxides of nitrogen; PM: particulate matter (-diameter); SO2: sulfur dioxide;
VOC: volatile organic compounds
O¤ highway: agricultural/construction machinery, recreational marine vessels etc.
Miscellaneous: forest …res, other burning, dust, natural sources.
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The Good News I
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February 9, 2012
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The Good News II
Standards
Period
< 1970
1970
1975–6
1980
1993
1994
2004-6
CO
84.0
34.0
15.0
7.0
3.4
3.4
1.7
US
VOC
10.6
4.1
1.5
0.4
0.4
0.3
0.1
NOx
4.1
NS
3.1
2.0
1.0
0.4
0.2
CO
84.0
34.0
9.0
9.0
3.4
3.4
3.4
CA
VOC
10.6
4.1
0.9
0.4
0.1
0.1
0.08
Total Emissions
NOx
4.1
NS
2.0
1.0
0.4
0.4
0.2
Pollutant
1970
2008
% Change
CO
VOC
NOx
PM-10
SO2
204.0
34.7
26.8
13.0
31.2
77.7
15.9
16.3
14.8
11.4
61.9
54.2
39.2
+13.8
63.5
Units:millions of tons
Units: gm/mi for light-duty vehicles
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The Good News III
The Good News IV
% Change in Transportation-Related Emissions, 1985–1994
Highway-Vehicle Emissions
Pollutant
1970
2008
% Change
88.0
13.0
7.4
0.4
38.9
3.4
5.2
0.2
56
74
30
50
172.0
0.0
CO
VOC
NOx
PM-10
Lead
Area
Units:millions of tons (Lead: thous. tons)
Philip A. Viton
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Nature of the Problem
VOC
NOx
NY-NJ
Pittsburgh
33
46
7
26
26
37
18
31
Dallas-Fort Worth
Miami
46
35
17
+6
35
14
25
7
LA
SF
Portland
32
30
28
9
16
5
26
22
23
18
25
12
Philip A. Viton
CO
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PM10
February 9, 2012
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Strategy
Air pollution is an externality for the same reason as tra¢ c congestion
We want to know:
Individuals have no incentive to take account of the damage their
emissions do to other’s health
What is the nature of the physical damage done by pollutants emitted
by transportation vehicles
As with congestion, the solution is pollution tolls, to equalize price
individuals face for their activities with total social costs of those
activities
What is the (marginal) value of that damage
More formally we know:
We address these following our usual strategy:
users will make their decisions based on their perceived average costs :
this will characterize the equilibrium distribution of travel
the (cost-minimizing system) optimum is based on users’making
decisions based on marginal cost, which incorporates the impact they
impose on others
Formally: MC = AC + Q ∂AC /∂Q : the second term is the external
damage
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We …rst outline the general physical impacts of selected pollutants
Then we discuss a way to estimate the value of (part of) the damage
due to transportation
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Volatile Organic Compounds (V0Cs) I
Volatile Organic Compounds (V0Cs) II
Sources
Transport: emitted by burning fuel
Impacts:
Also by chemicals found in the home or emitted by products like glues
and permanent markers
Irritate eyes, nose, throat
Home-emissions of VOCs are considered more of a problem than
transportation emissions
Cause headaches
However, according to the EPA, not much is known about the health
e¤ects from levels usually found in homes
Suspected carcinogens in humans (and, more certainly, in animals)
Damage liver, kidneys, central nervous systems
EPA regulates only formaldehydes in non-industrial settings (cf.
post-Katrina mobile homes)
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Carbon Monoxide (CO) I
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Carbon Monoxide (CO) II
Impacts: at high levels
Description
Can lead to vision problems
Colorless, odorless gas formed when fuel is incompletely burned
Reduced ability to work or learn
Sources
Reduced manual dexterity
Transport vehicles contribution about 50% of all CO emissions
nationwide, with upwards of 85% in urban areas
Other outdoor sources: metals processing, residential wood burning
Impacts: at low levels
Indoor sources: wood-burning stoves, gas stoves, cigarette smoke,
unvented gas/kerosene heaters.
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Poisonous to humans at very high levels. EPA strongly recommends
CO detectors in the home to control for this possibility (remembering
that CO is colorless and odorless).
Very detrimental to people with heart disease
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Oxides of Nitrogen (NOx) I
Oxides of Nitrogen (NOx) II
Description
Impacts:
Formed when fuel is burned at high temperatures
NO2 : respiratory problems
Contributes to formation of acid rain
Sources
Contributes to nutrient overload that deteriorates water quality
Motor vehicles
Aesthetic damage (visibility impairment)
Utilities
Reacts to form other toxic chemicals
Industrial/commercial/residential
May contribute to global warming
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Sulfur Oxides (SOx) I
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Sulfur Oxides (SOx) II
Description
Impacts: (primarily SO2 )
Family of gases produced when sulfur is burned
Respiratory damage, particularly on children from both gaseous and
particulate emissions
Sources
Contributes to acid rain, which also damages plants and water
Fuel burning electric utilities
Contributes to haze (visibility impairment)
Other fuel-burning industrial sources
Aesthetic damage: accelerates deterioration of building materials &
paints
O¤-road vehicles
Metals processing
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Lead (Pb) I
Lead (Pb) II
Impacts:
Sources: (recent)
Damages kidneys and liver
A¤ects brain an nervous system. Particularly acute for fetuses and
young children
Metals processing (> 50 %)
Waste disposal (
16%)
O¤-road vehicles (
Fuel combustion (
With high blood pressure, can lead to heart disease
13%)
In animals: same as people
13%)
In …sh: reproductive damage
Note that this problem has been e¤ectively eliminated in on-road
transportation
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Ground-Level Ozone
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Particulate Matter (PM) I
VOC + NOx + Sunlight = Ozone
‘Good’ozone:
Occurs 20–30 miles above earth’s surface
Protects against solar rays
Mixture of solid particles and liquid droplets in the air
‘Bad’ozone:
Occurs in lower atmosphere
Prolonged exposure: permanent lung damage
Low levels: can irritate lung airways and cause in‡ammation; can
cause aggravated asthma, reduced lung capacity, increased
susceptibility to pneumonia, bronchitis.
Impact on ecosystem: interferes with ability of plants to produce and
store food, making them more susceptible to disease, insects etc
Aesthetic damage to leaves etc
Reduces crop and forest yields
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Diameter measured in micrometers = microns (µm)
Typical diameter: 2.5µm : 1/70 width of human hair
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Particulate Matter (PM) II
Damage Estimation Methodologies
The literature has distinguished at least three ways to estimate the costs
of transportation pollutants
Particles less than 10µm in diameter (PM10) can get into lungs and
cause irritation of airways, aggravated asthma, bronchitis, irregular
heartbeats
Direct method
PM2.5 (Fine Particulates) is a major source of haze
Indirect (hedonic) methods
EPA does not currently regulate particles of diameter > 10 microns
(PM10): these are particles like sand or dust.
estimate physical deaths / sicknesses caused by pollutants
multiply by peoples’wtp to avoid this
Assume that (eg) property values re‡ect wtp to avoid polluted area
Regulatory
lower bound estimate of damage is inferred from costs of meeting
regulations
We follows Small + Kazimi (1995), who use the direct method
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Small+Kazimi: Assumptions
Damage to humans only: morbidity + mortality
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There is some controversy on just which aspect of particulate emissions
causes human mortality:
TSP = Total Suspended Particulates
No aesthetic damage
No CO impact : data was not available, and environmental impact is
highly controversial
LA only: $$1992. Note that the topography of LA makes it especially
susceptible to generating large impacts from pollutants. Other areas
may be very di¤erent.
Linearity of damage function
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Assumptions: Particulates I
Speci…cally aimed at transportation impacts: thus they examine only
the damage from particulates and ozone.
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February 9, 2012
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PM10
PM2.5 = Fine Particulates
SO4 = sulfates, mainly aerosols of aluminum sulfate
Small + Kazimi tend to follow the Evans study and attribute mortality to
PM10, rather than to other measurements.
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Assumptions: Particulates II
Small+Kazimi: Illustration
Impact of particulates can be from two sources:
For purposes of illustration, I now focus on one element of the
Small+Kazimi calculation
A vehicle emits particles directly.
These are the direct impacts, and is what is listed in the Small +
Kazimi tables, in columns headed PM10
The impact on human mortality of particulate matter in NOx
emissions
A vehicle emits some other substance, eg VOCs, which themselves
contain particles.
These are what is being measured in the other columns of their
tables: eg the VOC columns measure the impacts of particulate
matter in VOCs.
Philip A. Viton
CRP 776 ()
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February 9, 2012
I refer to this as NOx particles.
Other impacts are similarly calculated
This is pp. 18-19, and note 11 of the paper
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Small+Kazimi : Outline of Calculations
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Small+Kazimi : PM10 in the Air
To assess the impact of particles emitted in NOx, Small + Kazimi need to
know:
Emissions: How much particulate matter (PM10) is there in the air?
NOx Concentration: How much of that is due to NOx?
How does the NOx contribution relate to mortality?
How much particulate matter (PM10) is there in the air?
Estimated from 4 years observations at the downtown LA monitoring
station
Estimate: 57.8 µg /m3 . (paper, p. 19 …rst full paragraph).
So each cubic meter of air is estimated to contain 57.8 microns of
PM10 particles.
How much of the NOx contribution is caused by motor-vehicle
emissions?
What is the cost impact (wtp) of the motor–vehicle related emissions?
What is the cost impact for a speci…c vehicle type?
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Small+Kazimi : NOx Concentration
Small+Kazimi : Implications for Mortality
How do particles in NOx contribute to mortality?
How much of the observed PM10 is due to NOx particles?
NOx is estimated to contribute 10.5% of PM10 (paper p. 19, line 1)
Therefore: NOx contribution to PM10: 57.8
µg /m3 .
0.105 = 6. 069
In other words, each cubic meter of air is estimated to contain about
6.1 microns of NOx-caused particles.
Based on epidemiological studies
Regress death rates (deaths per 100,000 population) on causes (here,
ambient concentrations of pollutants).
Small+Kazimi prefer an estimate due to Evans (paper, p. 18): 0.338
deaths per 100,000 population per year per µg /m3 of PM10
emissions.
0.338 = 2. 051 3
So the contribution of NOx particles is 6.069
deaths/100,000 population
LA’s population is about 12 million = 120
100, 00
2.0513 = 246.1586
So annual deaths due to NOx particles are 120
people per year
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Small+Kazimi : Costs I
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Small+Kazimi : Costs II
What is the cost?
This is the most controversial part of any study
Small and Kazimi adopt a value-of-life approach
Deaths due to NOx in PM10: 246.1586 per year
How much is one willing to pay for a statistical life?
That is, what is one willing to pay for a reduction in the probability of
death
(Not wtp for avoiding one’s own certain demise).
Value of individual life: $4.87 million
So mortality cost of NOx in PM10: 246.1586
million/year (= $1.199 b/yr)
4.87 = 1198. 8 $
Estimate: $4.87 million per life saved (paper, Table 5, note (a)).
They also explore the implications of valuing a (statistical) life at
$11.3 million or $2.1 million
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Small + Kazimi : Total Vehicle-Related Costs
Small+Kazimi : Attribution to Speci…c Vehicles
NOx emissions due to motor vehicles are extrapolated from
monitoring stations in LA
Estimate: 762 tons / day due to motor vehicles
So we estimate 762
motor vehicles
365 = 278 , 130 tons / year of NOx emitted by
What is the cost of the damage done by a speci…c vehicle?
This is straightforward, based on EPA-conducted tests
Mortality cost per ton per year of motor-vehicle related NOx
emissions : 1198.8 106
278130 = 4310. 188 tons/year
For example, for the CA ‡eet in 1992, an average gasoline-powered
car emitted 1.26 gm/mi of NOx
1 Ton = 914,286 grams
Mortality cost of NOx emissions would be: 1.26
c//mi.
So annual mortality cost of NOx particles emitted by motor vehicles is
4310. 188
914286 = 4. 714 3
10
3
0.4714 = 0.594
Of course, we can be more speci…c as to vehicle type (see below).
$/gm
= 0.0047143 $/gm
= 0.4714 c//gm
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Small+Kazimi : Further Work
Philip A. Viton
Source
Then they study mortality and morbidity impacts of other pollutants
emitted by transportation vehicles, including direct PM10 emissions
Finally, ozone (morbidity only)
Mortality from particulates
Morbidity from particulates
Morbidity from ozone
Total
Obviously, a huge data crunch; but the calculations are in principle
very similar to the one illustrated here.
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Small+Kazimi : Baseline Damage Costs
To complete the study of NOx impact, Small and Kazimi need to
study the morbidity impact of NOx particles
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VOC
NOx
SOx
PM10
1.69
0.08
1.15
2.92
8.45
0.42
1.81
10.67
104.80
5.20
0.00
109.90
97.20
4.80
0/00
102.00
Units: $1000 in 1992 per ton of emissions
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Small + Kazimi : Results for Transportation
Vehicle, Assumption
1992 CA Fleet avg car
Baseline case
Low estimate
High estimate
1992 CA Heavy-duty truck
Baseline case
Low estimate
High estimate
VOC
NOx
SOx
Small + Kazimi : Results for Transportation
PM10
Total
Baseline Assumptions
Vehicle
1.21
0.67
3.69
0.76
0.42
2.31
1.48
0.57
5.64
18.45
7.06
70.24
0.46
0.12
2.02
6.98
1.79
30.59
0.13
0.03
0.56
26.51
6.80
116.16
3.28
1.38
11.91
52.70
16.07
219.30
Entries are pollution damage in c//vm
VOC
NOx
SOx
PM10
Total
1977 car in 1992
1.51
0.78
1.58
2.79
6.65
1992 CA Fleet averages
Gasoline car
Light-duty truck
Heavy-duty truck
1.21
0.12
0.76
1.48
1.75
18.45
0.46
1.48
6.98
0.13
4.44
26.51
3.28
7.79
52.70
2000 Estd CA ‡eet avg
Gasoline car
Light-duty truck
Heavy-duty truck
0.58
0.13
0.64
0.81
1.81
14.48
0.10
1.35
6.30
0.11
1.36
13.27
1.61
4.64
34.69
The Baseline assumptions do not correspond exactly to the calculations
described above: see paper, p. 23, note (a).
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Pollution Tax on Cars
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Pollution Tax on Cars I
We address this via the concept of elasticity
For CA ‡eet-average gasoline-powered car, 1992 pollution damage is
3.3 c//vm
Suppose we assessed this as an (additional) tax
Elasticity =
% change in behavior
% change in cost
where here, we take Behavior to mean miles driven
In 1992 gasoline in California cost about $1.20 per gallon
What behavior impact would we expect?
Average fuel economy was about 23 mpg
So cost per mile is about 120
23. = 5. 217 4 c//mile
A pollution tax would increase this to 5.2 + 3.3 = 8. 5 c//mile,
roughly a 63% increase
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Pollution Tax on Cars II
Pollution Tax on Trucks
Elasticity estimate (Greene 1992):
0.05 to
0.15
This says that each 1% increase in driving cost reduces driving by
about 0.05% to 0.15%
For ‡eet-average heavy-duty diesel truck: pollution cost
Note: driving seems not very sensitive to cost: we say that driving is
price-inelastic
Pollution tax represents change of between 13% and 41%
53c//vm
Operating costs for trucks: $1.30 – $4.20 /vm
So a 63% increase in cost (due to pollution tax) would reduce driving
by about 3% to 9.5% (63 0.05 = 3.2 ; 63 0.15 = 9.45).
We know that truckers’behavior is much more responsive to price
changes than private drivers
So we would expect a fairly large response
However, if tax varied by vehicle, there would also be an incentive to
change the ‡eet structure. This is not addressed.
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Externalities — A Last Look
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February 9, 2012
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Externalities
Consider
Urban expressway at capacity under current (not optimized)
conditions
BPR time function
Free-‡ow speed: 65mph ; speed when q/c = 1 : 30 mph
Cars : CA 2000 Fleet average
PCE factor = 1 ; ESAL factor = 0
Value of time: $17.25 pce/hr
Trucks : CA 2000 light-duty ‡eet average
SU3 at GVW 55,000 lbs
PCE factor: 1.5
Vehicle, Toll source
$/vm
Cars
Congestion cost
Durability cost
Pollution cost
Total external cost
1.23
0.00
0.03
1.26
Trucks
Congestion cost
Durability cost
Pollution cost
Total external cost
1.85
0.33
0.07
2.25
In‡ation: all values have been updated to roughly $$2010
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Philip A. Viton
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Externalities — Caveats
Externalities with Spread Peak
These are …rst-round (peak) tolls only
It is very likely that imposing them would lead to signi…cant changes
in behavior
Let’s suppose we get peak spreading so that the peak q/c ratio falls
to 0.9
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References
D. L. Greene.
“Vehicle use and fuel economy: How big is the ‘rebound’e¤ect?”.
Energy Journal, 13 (1) : 117–143, 1992.
Arnold M. Howitt and Alan Altshuler.
“The politics of controlling air pollution”.
In Jose Gómez-Ibañez, William B. Tye, and Cli¤ord Winston, editors,
Essays in Transportation Economics and Policy, pages 223–256.
Brookings Institution Press, Washington D.C., 1999.
Kenneth A. Small and Camilla Kazimi.
“On the costs of air pollution from motor vehicles”.
Journal of Transport Economics and Policy, 29: 7–32, January 1995.
United States Department of Commerce.
Statistical Abstract of the United States.
U.S. Government Printing O¢ ce, Washington, D.C., 2012.
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Philip A. Viton
Vehicle, Toll source
$/vm
Cars
Congestion cost
Durability cost
Pollution cost
Total external cost
0.81
0.00
0.03
0.84
Trucks
Congestion cost
Durability cost
Pollution cost
Total external cost
1.22
0.33
0.07
1.62
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