Mind the gap: personal carbon trading for road transport in Kenya

Abstract

Developing countries have generally been overlooked in downstream carbon tradingbased policy research. This can be attributed to the greater responsibility of developed economies for climate change, and the greater socio-demographic, political and technological challenges faced by their less-developed counterparts. This paper attempts to address this gap by examining the practicality of implementing Personal Carbon Trading (PCT) for personal road transport in Kenya. PCT is investigated with a focus on political considerations, potential system operation and the distributional impact of quota allocation to motorists. Three quota allocation methods are modelled using data from a survey of 500 motor vehicle owners in Nairobi and Mombasa counties. Equal per-capita, equal per-vehicle and needs-based allocation methods are modelled and assessed to determine the distributional impact on various groups of interest. Emissions were found to be highly correlated to vehicle engine size and the number of dependents per vehicle, but not to area of residence or income levels. None of the three allocation methods disproportionately imposed burdens on vulnerable groups, and all exhibited progressive tendencies. The proposed system is intended to add new insight into the possibility of PCT becoming a globally inclusive policy option. Key Policy Insights. Despite PCT being a bold policy proposal even for developed countries, less developed counterparts can meet the political, institutional and technological requirements to implement it.. The wealth of functionality available through SIM card features on cheap and abundant mobile phones may unlock a simple and cost-effective, globallyapplicable PCT system.. Public resistance to fuel price increases stems from the lower income demographic which is, conversely, rewarded with surpluses under PCT.. Equal-per capita allocation remains the most progressive method.. Needs-based allocation is highly progressive and may be worth considering when more stringent targets are deemed necessary.

Personal Carbon Trading—Lost in the Policy Primeval Soup?

“…While some of the researchers question the level of costs estimated by DEFRA [7,34], most agree that the costs of operating a PCTS are much higher than for alternative schemes such as a carbon tax or an ETS. Still, there are other opinions, Al-Guthmy and Yan [53] do not see financial costs as a major problem for operating a PCTS in Kenya. However, as mentioned above, these results are hard to generalize.…”

“…When it comes to assessing the technical feasibility of PCT, many authors refer to DEFRA's opinion. An exception is the article by Al-Guthmy and Yan [53], which uses road transport in Kenya as an example to show how a PCTS could be integrated into existing infrastructure, highlighting potential opportunities and barriers. Overall, they conclude that both infrastructure and cost are not significant barriers to implementing a PCTS [53] (p. 1152).…”

“…An exception is the article by Al-Guthmy and Yan [53], which uses road transport in Kenya as an example to show how a PCTS could be integrated into existing infrastructure, highlighting potential opportunities and barriers. Overall, they conclude that both infrastructure and cost are not significant barriers to implementing a PCTS [53] (p. 1152). To be clear, the research is focused on Kenya and thus it is difficult to generalize the result.…”

“…To be clear, the research is focused on Kenya and thus it is difficult to generalize the result. Nevertheless, the authors mentioned, "Even though our work focused on Kenyan road transport, it provides a reasonable starting point for consideration by other developing countries and would benefit from complementary research in other major sectors, such as agriculture (for example through policies such as Payment for Environmental Services)" [53] (p. 1156).…”

“…Therefore, these researchers may be more positive about PCT than the general research and policy community. As Table 2 shows, 38% of authors feel positive about PCT, as evidenced by statements such as: "The conclusion is that PCT is a promising and timely policy idea" [7] (p. 6868) or "Consequently, as the highly ambitious commitment deadlines made in the Paris Agreement draw closer, policy instruments such as PCT are becoming more worthy of a thorough exploration and will become even more relevant on a global scale" [53] (p. 1156). To the same extent, there are also researchers who have a more differentiated opinion or do not make general statements about PCT.…”