Forecasting the Impact of Disruptive Transport Technologies on Road Revenues in South Africa

Disruptive Transport technologies: Disruptive Transport technologies: Forecasting the impact on road Forecasting the impact on road- -generated revenues in South Africa South Africa generated revenues in J van Rensburg S Krygsman

Introduction Introduction Innovative technologies changes the way the world works Disruptive Incremental Concern and excitement SA social and economic goals (NDP 2030) Extent to which disruptive technologies may impact SA s ability to secure funding for roads using current charging mechanisms?

Impacts and implications from an international Impacts and implications from an international perspective perspective Road funding revenue forecasting Travel behaviour Municipal budgets Transport operator s revenue Possible advantages

Identifying disruptive trends affecting road Identifying disruptive trends affecting road cost recovery cost recovery Table 1: South Africa s road user cost recovery methods and affecting trends Components that determine individual road user cost recovery methods revenue Category % of road- generated revenue Charge (Tax) amount (R) Road Accident Fund amount (R) Custom and Excise Levy amount (R) Demand Side Management Levy Charge (Tax) amount (R) Petroleum Products Levy (Pipeline) Trends impacting cost and measuring unit components Method % of road- generated revenue Road user cost recovery Category Road user cost recovery method Cost Measuring unit component Technological trends Political decisions Social trends component Charge increase or decrease Charge increase or decrease Charge increase or decrease 47% Fuel levy Fuel sales (#) Charge (Tax) 22% Fuel sales (#) Charge (Tax) 1% Fuel sales (#) Vehicle fuel efficiency, Biofuels and Electric vehicles Distance travelled, vehicle ownership Fuel- based 70% Charge (Tax) amount (R) Charge increase or decrease <1% Fuel sales (#) Charge increase or decrease <1% IP Marker Levy Fuel sales (#) Charge (Tax) amount (R) Charge increase or decrease <1% Fuel sales (#) Vehicle ownership and user compliance Fee amount (R) Charge increase or decrease 7% License fees Vehicles (#) CO2 emissions of new vehicles above threshold (#) 9% Vehicle- based Fee (tax) amount (R) Greener vehicle technologies Charge increase or decrease CO2emissions 2% Vehicle ownership Charge increase or decrease increase Charge (Tax) amount (R) Weight of new tyres sold (#) <1% Tyre Levy Usage efficiency Vehicle ownership Fee and Charge amount (R) Vehicle ownership and user compliance Vehicle ownership and distance travelled Vehicle ownership and distance travelled Fines/road fees and permits Charge increase or decrease 11% Vehicles (#) Charge increase or decrease increase Charge increase or decrease increase 21% User- based Fee amount (R) Vehicles using toll roads (#) 4% Toll fees Toll fees concessions Fee amount (R) Vehicles using toll roads (#) 6%

Forecasting the impact of disruptive trends Forecasting the impact of disruptive trends Table 2: South Africa s road user cost recovery methods revenue forecast (Rand) 000 000 Actual Category Road user cost recovery method 2010 Fuel levy 32 837 Road Accident Fund 14 702 Custom and excise levy 817 Demand Side Management Levy 51 IP Marker levy 1 Petroleum Products Levy (Pipeline) 31 License fees 5 057 CO2 emissions 625 Tyre Levy 0 Fines/fees and permits 9 011 Toll fees 2 073 Toll fees concessions 3 987 Total road-generated revenue 69 195 Projection 2015 64 811 40 425 1 050 263 1 39 7 949 2 067 0 11 852 4 168 6 337 138 964 2020 83 919 51 007 1 049 807 1 72 10 646 3 135 397 13 452 6 703 8 603 179 796 2025 109 779 69 962 1 153 1 141 1 96 13 343 4 203 449 15 051 9 238 10 869 235 290 2030 135 639 88 918 1 257 1 474 1 119 16 040 16 040 502 16 651 11 772 13 135 301 554 Fuel-based Vehicle-based User-based

Forecasting the impact of disruptive trends Forecasting the impact of disruptive trends Table 3: Revenue loss due to vehicle fuel efficiency improvement (Rand) 000 000 Actual Category Road user cost recovery method 2010 Fuel levy 0 Road Accident Fund 0 Custom and excise levy 0 Demand Side Management Levy 0 IP Marker levy 0 Petroleum Products Levy (Pipeline) 0 Total revenue loss 0 Total revenue % loss 0 Projection with trends 2020 447 272 5 4 <1 <1 730 -0.40% 2015 19 12 <1 <1 <1 <1 31 -0.02% 2025 1 615 1 029 16 16 <1 1 2 679 -1.14% 2030 3 631 2 380 33 39 <1 3 6 088 -2.02% Fuel-based

Forecasting the impact of disruptive trends Forecasting the impact of disruptive trends Table 4: Revenue loss due to biofuel penetration (Rand) Actual Road user cost recovery method 2010 Fuel levy 0 Road Accident Fund 0 Custom and excise levy 0 Demand Side Management Levy 0 IP Marker levy 0 Petroleum Products Levy (Pipeline) 0 Total revenue loss 0 Total revenue % loss 0 000 000 Category Projection with trends 2020 1 678 1 020 20 16 <1 1 2 737 -1.52% 2015 1 296 808 21 5 <1 <1 2 131 -1.53% 2025 2 195 1 399 23 22 <1 1 3 642 -1.55% 2030 2 712 1 778 25 29 <1 2 4 548 -1.51% Fuel-based

Forecasting the impact of disruptive trends Forecasting the impact of disruptive trends Table 5: Revenue loss due to electric vehicle penetration (Rand) Actual Road user cost recovery method 2010 Fuel levy 0 Road Accident Fund 0 Custom and excise levy 0 Demand Side Management Levy 0 IP Marker levy 0 Petroleum Products Levy (Pipeline) 0 Total revenue loss 0 Total revenue % loss 0 000 000 Category Projection with trends 2020 62 38 <1 <1 <1 <1 102 <-0.00% 2015 9 5 <1 <1 <1 <1 15 <-0.00% 2025 132 84 1 1 <1 <1 220 <-0.00% 2030 213 140 1 2 <1 <1 358 <-0.00% Fuel-based

Forecasting the impact of disruptive trends Forecasting the impact of disruptive trends Table 6: Revenue loss due to decreased distance travelled (Rand) Actual Road user cost recovery method 2010 Fuel levy 0 Road Accident Fund 0 Custom and excise levy 0 Demand Side Management Levy 0 IP Marker levy 0 Petroleum Products Levy (Pipeline) 0 Toll fees 0 Toll fees concessions 0 Total revenue loss 0 Total revenue % loss 0 000 000 Category Projection with trends 2020 770 468 9 7 <1 <1 61 78 1 396 -0.78% 2015 737 459 11 2 <1 <1 47 72 1 332 -0.96% 2025 817 520 8 8 <1 <1 68 80 1 505 -0.64% 2030 835 547 7 9 <1 <1 72 80 1 554 -0.52% Fuel-based User-based

Forecasting the impact of disruptive trends Forecasting the impact of disruptive trends Table 7: Revenue loss due to greener vehicle technologies (Rand) Actual Road user cost recovery method 2010 Vehicle-based CO2 emissions 0 Total revenue loss 0 Total revenue % loss 0 000 000 Category Projection with trends 2020 280 280 -0.16% 2015 185 185 -0.13% 2025 376 376 -0.16% 2030 1 436 1 436 -0.48%

Forecasting the impact of disruptive trends Forecasting the impact of disruptive trends Table 8: Revenue loss due to vehicle parts usage efficiency (Rand) Actual Road user cost recovery method 2010 Vehicle-based Tyre Levy 0 Total revenue loss 0 Total revenue % loss 0 000 000 Category Projection with trends 2020 79 79 -0.04% 2015 0 0 0 2025 89 89 -0.04% 2030 100 100 -0.03%

Forecasting the impact of disruptive trends Forecasting the impact of disruptive trends Table 9: Revenue loss due to decreased vehicle ownership (Rand) Actual Road user cost recovery method 2010 Fuel levy 0 Road Accident Fund 0 Custom and excise levy 0 Demand Side Management Levy 0 IP Marker levy 0 Petroleum Products Levy (Pipeline) 0 License fees 0 CO2 emissions 0 Tyre Levy 0 Fines/fees and permits 0 Toll fees 0 Toll fees concessions 0 Total revenue loss 0 Total revenue % loss 0 000 000 Category Projection with trends 2020 2 116 1 286 26 20 <1 1 1 325 2 562 8 279 139 178 7 944 -4.42% 2015 294 183 4 1 <1 <1 188 1 649 0 280 98 150 2 851 -2.05% 2025 4 727 3 012 49 49 <1 4 2 691 3 521 8 275 169 199 14 708 -6.25% 2030 7 948 5 210 73 86 <1 7 4 216 13 783 8 273 193 215 32 016 -10.62% Fuel-based Vehicle-based User-based

Forecasting the impact of disruptive trends Forecasting the impact of disruptive trends Table 10: Revenue loss due to lack of user compliance (Rand) Actual Road user cost recovery method 2010 License fees 0 Fines/fees and permits 0 Total revenue loss 0 Total revenue % loss 0 000 000 Category Vehicle-based User-based Projection with trends 2020 3 533 6 726 10 259 -5.71% 2015 3 014 5 926 8 940 -6.43% 2025 3 914 7 525 11 440 -4.86% 2030 4 216 8 325 12 541 -4.16%

Forecasting the impact of disruptive trends Forecasting the impact of disruptive trends Table 11: South Africa s road user cost recovery methods total revenue loss due to disruptive technological and societal trends (Rand) 000 000 Actual Category Road user cost recovery method 2010 Fuel levy 0 Road Accident Fund 0 Custom and excise levy 0 Demand Side Management Levy 0 IP Marker levy 0 Petroleum Products Levy (Pipeline) 0 Total revenue loss 0 Total revenue % loss 0 License fees 0 CO2 emissions 0 Tyre Levy 0 Total revenue loss 0 Total revenue % loss 0 Fines/fees and permits 0 Toll fees 0 Toll fees concessions 0 Total revenue loss 0 Total revenue % loss 0 Total road-generated revenue loss due to technological and societal trends 0 Total road-generated revenue % loss due to technological and societal trends 0 Projection with trends 2020 5 076 3 085 63 48 <1 4 8 278 -4.60% 4 858 2 843 87 7 789 -4.33% 7 005 200 257 7 463 -4.15% 2015 2 356 1 469 38 9 <1 1 3 875 -2.79% 3 202 1 834 0 5 037 -3.62% 6 207 146 222 6 575 -4.73% 2025 9 487 6 046 99 98 <1 8 15 741 -6.69% 6 605 3 897 98 10 601 -4.51% 7 801 238 280 8 320 -3.54% 2030 15 341 10 057 142 166 <1 13 25 722 -8.53% 8 432 15 220 108 23 760 -7.88% 8 599 265 296 9 161 -3.04% Fuel-based Vehicle-based User-based 15 488 23 452 34 663 58 644 -11.15% -13.09% -14.73% -19.45%

Conclusion Conclusion Discussed the potential impact of disruptive transport technologies on road-generated revenues International perspective South Africa perspective Recommendation

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