MODELLING EXTERNAL COSTS OF ESTONIAN LAND TRANSPORT

Client: Majandus- ja Kommunikatsiooniministeerium

Period: 2009

The goal of this project was to create a simulation tool that allows to calculate external costs of transport sector (costs that arise e.g. due to environment pollution, noise or congestion) depending on the total vehicle kilometres by transportation mode and vehicle type. The tool was based on MS Excel and can be used for estimating the external costs of transport sector by region (urban or rural area), transportation mode and vehicle type. It helps to understand the sources of external costs produced by Estonian land transport as well as what would happen to these costs if people would change their transport preferences.

The simulation tool was accompanied by a report describing the methodology used for composing the model, presenting calculations of external costs for year 2007 and comparing these costs with revenues generated with measures currently in used in Estonia for internalizing the external costs of transport.

The project was commissioned by Ministry of Economic Affairs and Communications and was prepared in cooperation with Säästva Eesti Instituut.