Assessing Transportation Financing Options from a GHG Perspective

The Highway Trust Fund (HTF) has served as the primary vehicle by which transportation is funded. However, it is well on its way to running out of funding. While an important source of funds, the HTF has not always produced projects that were consistent with the aim of reducing greenhouse gas (GHG) emissions. A number of new finance options have been floated in recent years including and perhaps most prominently, a vehicle mile tax. This concept could be highly effective for reducing GHGs, but is not the only option. Others being discussed include “pay as you drive” insurance, energy user fees indexed to vehicle efficiency, congestion and parking pricing, and feebates. This white paper synthesizes the major transportation funding mechanisms currently being used or discussed in the U.S. and Europe, and characterizes the state of knowledge with respect to their ability to also enhance the reduction of GHG emissions.


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