The future of transport-related emissions in dense urban areas: an analysis of various policy scenarios with MOLES

Reducing air pollution is a major policy challenge, especially in densely populated urban areas where human exposure to emissions is considerable. This paper develops and examines a series of scenarios for the evolution of transport-related emissions in the area of Santiago, Chile. The study spans a time window up to 2050 and focuses on seven air pollutants and CO2. It compares a reference scenario with policy counterfactual scenarios involving a rapid electrification of public buses, a carbon pricing scheme and a kilometer charge differentiated by vehicle type. The reference scenario predicts a 55-80% reduction in air pollutants emitted by urban transport systems, by 2050. The corresponding reduction of CO2 lies at 6%, highlighting the asymmetric evolution in tailpipe filtering and carbon capture technologies. The analysis suggests that ramping up the efforts to electrify the bus fleet may eliminate 25% of the CO2 and at least 10% of the remaining air pollutant emissions in 2050. These figures increase to 45 and 30%, respectively, if rapid electrification is accompanied by one of the two tax schemes. With a distinct program to recycle the revenue from the tax schemes, the policy reform can be welfare improving for all groups and its environmental objectives can be achieved without adverse distributional consequences. The paper highlights the synergies of policies curbing climate change and tacking air pollution from the viewpoint of urban transport.