Allowing single-occupant low-emission cars in California to use high-occupancy vehicle (HOV) lanes on congested highways exacerbates the congestion and causes up to about $4,500 per car in adverse social costs annually, including increased commute times and carbon dioxide emissions, according to a new study in the American Economic Journal: Economic Policy.

The authors, from Cornell University, University of Colorado, UC Irvine and UC Berkeley, calculated that the Clean Air Vehicle Stickers (CAVS) policy results in a best-case cost of $124 per ton of reductions in greenhouse gases; $606,000 per ton of nitrogen oxides reduction; and $505,000 per ton of hydrocarbon reduction—exceeding those of other options readily available to policymakers.

The California law enabling single-occupant access to the HOV lanes was meant to stimulate sales for fuel-efficient, ultra low-emission vehicles, with the goals of reducing dependence on foreign oil and saving money at the gasoline pump. Between August 2005 and June 2011, California law allowed owners of hybrid vehicles achieving at least 45 mpg (5.2 l/100 km) to purchase a Clean Air Vehicle Sticker for $8, allowing them to drive on carpool lanes regardless of the number of occupants in the car. However, two-thirds of the sticker registrants had hybrid cars already on the road, the authors noted; in other words, the stimulus effect was lower than expected.

While the original clean air sticker policy expired in 2011, a new HOV-exception program with 40,000 stickers for electric, hydrogen fuel cell, and plug-in hybrid vehicles started in 2012.

While adding a single hybrid to any HOV lane at 2 a.m. creates no congestion or social costs, said the researchers, adding one hybrid driver at 7 a.m. on weekdays to an already congested road such as Interstate 10 in the Los Angeles area appends $4,500 per car in annual costs (in pollution and time) to society.

With the addition of solo-driver hybrids on already congested highways, HOV lane traffic climbs above 30% beyond socially optimal levels, according to the research. Thus, carpooler congestion costs substantially outweigh the green benefits of hybrids, the researchers concluded.

The economists suggested several alternatives:

• Instead of letting the solo-driver hybrids into rush-hour carpool lanes, the state should provide a tax credit for hybrid vehicles, much like the federal government.
• Policymakers could ration HOV access via congestion pricing, which could relieve congestion and improve air pollution.
• Having commuters use buses may represent the win-win in terms of pollution and congestion that policymakers were hoping with the CAVS [sticker] policy, the researchers suggested in the paper.

Even if vehicles were truly zero emission, policies that promote their adoption at the expense of exacerbating congestion still generate substantial losses of time for high-occupancy vehicle commuters, they explain in the paper.

To reduce congestion in that interstate corridor and to be fair to commuters in high-occupancy vehicles, the economists suggest a congestion toll of 45 cents per mile, and for hybrid and low-emission vehicles, a reduced congestion toll amounting to 38 cents per mile.