Funding and Controlling Pollution - Example

Name: Instructor: Course: Date: Cost Benefit Analysis 1. Introduction The pollution through vehicles is widely seen in the areas of high economic activity and growth. As all of UK is part of the world that witness high economic and industrial activities, the vehicular pollution is inevitable and planned activities are necessary to minimise it. In the absence of serious measures to control pollution, the environment pollution through vehicles will be a serious problem for any country or province/state. The serious measures taken are according to the observations at the points of pollution. The points of pollution regarding vehicular pollution are vehicles or automobiles. An automatic system can detect the pollution of the vehicles and reports it to the authorities. This requires initial investment and the benefits of that investment depend on the returns materialised by penalties imposed on violators. The objective of this paper is to explore the cost benefits of the policy and system monitoring the pollution of the vehicles. This includes the changes in emissions of automobiles and the technology and the costs involved in it to detect the pollution. 1 2. Data Base of Vehicles The presence of automobiles requires a database to estimate the number of them. This helps in estimating not only the number of insurances they paid, but also to track the vehicle if it violates any norms. In case of pollution control, the vehicle tracking is according to its number. The cameras installed will detect the violators of the pollution controls and fine the vehicles by tracking them through the database. The new database has to list the vehicles and classify them according to the norms they follow regarding pollution. If any cameras installed in different areas of the country detect the vehicle of not following pollution control norms, it will declassify it into the list, which does not follow the pollution control norms. Not only fining the vehicles that do not follow the control norms, the administration has to maintain the database that follows classification of vehicles according to the pollution norms control. This enables the administration to take necessary action on the vehicles in the form of collecting extra license fees and penalties for not following pollution control norms. 2 3. Funding and Controlling Pollution The urban land needs clean air to sustain life. The vehicular pollution is a factor that needs attention to have a clean air atmosphere. The presence of hybrid vehicles can reduce the pollution to a certain extent. 3 The poor air quality needs regular monitoring and the monitoring is cost effective or accrues benefits if it is having well planned consequences. A monitoring plan involving cameras to check the automobiles to charge the vehicles that pollute environment is a necessity. The cameras check the vehicles according to the rules of pollution control in Scotland. The aspects that need focus are air monitoring, emission inventory, air management planning and regulation of commercial and industrial emission. As this plan is for vehicular emission, the places of heavy traffic and junctions of roads are fitted with cameras. These cameras can detect the vehicular emissions and pass information to the database managers. The managers can decide accordingly. The managers should have a fee based permitting system, which prompts the vehicle owners to follow the pollution norms. The following table about depletion of ozone displays the growing need of control of pollution to protect ozone levels. 4 The graphical figure is adopted from http://www.pyr.ec.gc.ca/air/clean_air_e.htm The motor vehicle monitoring system will accrue benefits for the costs when the vehicles are subject to type approval and conformity of production requirements. The Cameras must detect the tall pipe emission standards for carbon monoxide, hydrocarbons, and oxides of nitrogen and in case of diesels. The Cameras should do on-board diagnostics not just for emissions, but also for the charge or fine collected from vehicle owners. The permission is given for vehicle to move on the road when it is fitted with system that recognises emissions and functioning, when the emissions are above the prescribed limits. 5 4. Devices of Detection and Cameras The monitoring needs remote detection of vehicular emissions. The cameras are such devices working based on collimated radiations of infrared and ultra violet rays. These cameras cost substantially to exchequer and the benefits accrue in course of time. 6 The cost of vehicular emissions detectors is high and each instrument may cost one, 00,000 GBP. The cost of the viability study may conclude at 50,000 GBP. The long term monitoring costs for vehicular emissions may stand at 2, 50,000 GBP. The following table gives information about the costs involved in using and installing the detector cameras. Item or service description Cost involved Number of cameras Number of points to be installed Monitoring personnel Cost of total cameras Cameras 1,00,000 1 per point 200 2000 2,00,00,000 Installation equipment 1,00,000 1 set for camera 200 2000 2,00,00,000 Monitoring costs for 5 years 2,50,000 2,50,000 Total Cost for 200 points 4,02,50,000 Thus 4, 02, 50,000 GBP can be estimated as the total cost for the initiation of the project for a five year period. The cost benefit analysis will be viable, if the benefits or charges accrued due to monitoring the vehicular emissions in Scotland. 7 The first charge that accrues income for the system is penalty for default or excessive emissions. This depends on the offence committed that depends on the emission of the vehicle. The penalty is of two types. 1. Emission penalty, 2. Idling penalty. The emission penalty is the penalty that is imposed on vehicles detected for excessive emissions. This again can be of two types. The first type is for the vehicle, which is having permission and emitting excessive pollutants. The second type is about the vehicles that are running on roads after the permitted period and emitting excessive pollutants. The first type penalty will amount to 60 GBP and second type penalty amounts to 120 GBP. The hugeness of second type of penalty is to discourage the usage of time is elapsed for vehicles. The second category penalty is regarding all the vehicles irrespective of the emission controls. However, the vehicle is emitting pollutants in the limit prescribed, if the vehicle is stationary and the engine is on for excessive amount of time that is not useful, penalty can be imposed. This is to discourage the vehicle owners to switch on the engine when there is no necessity. The unnecessary use of engine may increase the total emissions into the environment and the pollution control norms may give wrong notions due to stationary usage of engine. This penalty can be across 30 GBP. Estimates of benefits accrued with the imposition of penalties. Penalty type Emission penalty for vehicles having permission to run Emission penalty for vehicles having no permission to run Emission penalty for vehicles running engine, when idle. Penalty amount 60 GBP 120 GBP 30 GBP Penalty type Total amount of penalty in 1 year Total amount of penalty at the end of 2nd Year Total amount of penalty at the end of 3rd Year Total amount of penalty at the end of 4th Year Total amount of penalty at the end of 5th Year Penalty I (at the rate of 10000 vehicles per year) 6,00,000 GBP 12,00,000 GBP 18,00,000 GBP 24,00,000 GBP 30,00,000 GBP Penalty II (at the rate of 2000 vehicles per year) 2,40,000 GBP 4,80,000 GBP 7,20,000 GBP 9,60,000 GBP 12,00,000 GBP Penalty II ( at the rate of 1000 vehicles per year) 300,000 GBP 60,000 GBP 90,000 GBP 1,20,000 GBP 1,50,000 GBP Total 43, 50,000 GBP This accrues a revenue of 43, 50,000 GBP in a 5 year period. The cost of the project is estimated at 4, 02, 50,000 GBP. This implies that the project is not viable for a 5-year period and at the staggering costs regarding monitoring. This demands the increase of penalties or motor vehicle taxes to compensate the losses incurred for monitoring the vehicular losses. Though much progress has been achieved in reducing the air pollution due to vehicular emissions I UK, the measures are necessary to deliver expected emission reductions in the coming period. The benefits of the emission monitoring and reduction, though it is costly will accrue benefits regarding environment. The monitoring and reduction should assure that the engines deliver similar emissions performance in service as assessed during the type approval. It is easy to define or set standards to emissions control as there are common standards adopted for all over European Union. The alternatively fuelled vehicles need monitoring according to single standard, which may result in removal of trade barriers across the borders. The costs may escalate when some types of engines employ alternative control strategies depending on the operative conditions. These need separate monitoring systems. The monitoring system is cost effective if a single monitoring system can monitor both type of control of emissions standards. The regulatory instruments also affect the cost and benefits of any strategy. The identification of the options is a mandatory drive according to European Union Law. This identification of options affects the identification of benefits. The benefits are accrued by introducing the new limits for future heavy-duty engines and bringing gas-fuelled engines within the scope of the directives. The indirect benefit is improving air quality across the Europe thus bringing protection to public health. The reducing of potential for engines also will accrue a benefit by facilitating them to uptake the alternative fuel engines. This reduces pollution from transport and helps in containing air pollution. The clarification of test procedures is a necessity and legislation helps in control of key air pollutants. The quantifying of the benefits is the consequence after their identification. The studies on emissions of nitrogen dioxide and other particles will help in quantifying the benefits by estimating the reductions. The benefits accrued should be in compliance to the costs for business as much as possible, though not for full extent. As the UK manufacturers of heavy-duty vehicles rely on independent engine manufacturers, the Scotland also is of the same procedure. The light-duty sector seeks emission approval for complete vehicle. As a result, a common emission monitoring strategy for heavy-duty and light-duty vehicles will result in cost compliance for both industry and administration. In the absence of the common monitoring system, the heavy-duty engine manufacturers are badly affected and this sector of industry will not have cost compliance, the monitoring system needs. The following table displays the testing and approval fee for pre engine and with engine, testing that affects the heavy-duty vehicle manufacturers.   Per engine family   Without engine testing With engine testing Type approval Authority fees £820 £1,230 Manufacturer costs £1,640 £42,000 Total £2,460 £43,230 The above table is adopted from http://www.dft.gov.uk/consultations/aboutria/ria/measuresagainstairpollutionb5537 The present monitoring system may raise demand for gas fuels as they have relaxation of Requirements. The cost compliance regarding different engines is as in the box besides. The above content in the box is adopted from http://www.dft.gov.uk/consultations/aboutria/ria/measuresagainstairpollutionb5537 The involvement of heavy-duty engine manufacturers in formulation of directive will suggest less burdensome and less costly monitoring systems proposal. The monitoring systems involve the costs to industry and increase unit cost increase. The Government considering the benefits of health and environment should take care that those benefits are substantially more than the increase of unit cost to the industry. 8 References: 1. PAULO A.L.D. NUNES , Application of Technological Control Measures on Vehicle Pollution: A Cost-Benefit Analysis in China, 2005, Social Science Research Network, Volume Information not Available, Retrieved on 11th March 2008 from 2. Insurance Journal, New U.K. Database Tackles Auto Insurance Fraud, 2005, Insurance Journal, Retrieved on 11th March 2008 from http://www.insurancejournal.com/news/international/2005/01/21/49960.htm 3. Clean Air Tool Kit, Transit Friendly Planning, 2008, Clean Air Took Kit, Retrieved on 11th march 2008 from < http://www.cleanairkit.ca/transit/default.cfm> 4. http://www.pyr.ec.gc.ca/EN/Air/air_whois.shtml 5. pyr.ec.gc.ca, The Clean Air Picture, 2004, Pyr.ec.gc.ca, Retrieved on 11th March 2008 from < http://www.pyr.ec.gc.ca/air/clean_air_e.htm> 6. Greening, P., On-board diagnostics for control of vehicle emissions, 1994, IEEE, Retrieved on 11th March 2008 from < http://ieeexplore.ieee.org/Xplore/login.jsp?url=/iel3/1327/7182/00289040.pdf> 7. Free Patents Online, Apparatus for remote analysis of vehicle emissions, 2007, Free Patents Online, Retrieved on 11th March 2008 from 8. EPA, Infrared Spectroscopy and Imaging, 2007, EPA, Retrieved on 12th march 2008 from < http://clu-in.org/char/technologies/infrared.cfm> 9. Department for Transport, "The Road Vehicles (Construction and Use) (Amendment) (No.2) Regulations 2002", 2004, Department for Transport-UK, Retrieved on 13th March 2008 from < http://www.dft.gov.uk/consultations/aboutria/ria/measuresagainstairpollutionb5537> Read More