Electronic Toll Collection Systems in Europe

Global Positioning Satellites Taking Their Toll ? Electronic Toll
Collection Systems in Europe

Electronic Toll Collection (ETC) and Road User Charging (RUC) systems are
starting to feature heavily on European governments' agendas. Whilst
countries like France, Italy, Portugal and Spain have now had tolling
systems on their roads for over 20 years, many other countries - Germany in
particular ? have traditionally had a policy of toll-free roads for
everyone. This is set to change. Not only is the market set to rise
meteorically, technologies are being transformed as well.  Frost & Sullivan
(http://transportation.frost.com) Project Manager Miranda Carpenter looks
at the issues.

Electronic toll collection has fast become popular with operators and users
alike, as the driver does not have to stop at a toll-booth and physically
pay the toll. Payment is conducted by means of microwave communication
between an On-Board Unit (OBU) inside the vehicle and a roadside computer.
The vehicle's OBU communicates unique identity information to the roadside
processing computer, which enables the computer to identify the type of
vehicle passing through ? ie motorcycle, passenger car or commercial
vehicle ? and which account to debit or invoice.

According to a new study currently in progress by Frost & Sullivan, there
are around 4.3 million OBUs in use in Europe today. This is a figure that
is expected to leap to 14.3 million units by 2006, with potential in the
years to 2015 for a situation in which every vehicle in Europe has an OBU
capable of collecting electronic toll fees, as well as carrying out other
intelligent transportation functions.

The benefits of ETC speak for themselves; customers need not slow down for
tolls to be paid, resulting in less congestion, and faster journey times.
This in turn leads to increased fuel economy and less pollution to the
environment. As the payment is transacted automatically, drivers need not
worry about having the correct change at the beginning of a journey. For
the operator, less space is required to construct the toll system (see open
carriageway systems below), operating costs are reduced and revenues are
generally increased, as fraud is eliminated.

However, toll collection systems have evolved over the years, and a
pioneering new technology being piloted in Switzerland is set to
revolutionise the industry. Original ETC systems were in the form of
dedicated fast lanes in manual toll plazas, where one or more lanes are
dedicated to automatic toll collection. Customers can choose whether to pay
manually or to purchase an OBU to enable cash-free payment. Subsequently,
open carriageway systems were developed. Transponders located on gantries
above the road employ a technology similar to that used in toll plazas. The
transponders establish a tolling zone by creating "virtual" entry and exit
boundaries, and in-vehicle OBUs communicate with the transceiver, via a
microwave link, to register that the vehicle has passed through the
charging area. The vehicle's identity is then passed to a central computer
for billing purposes. Those vehicles without OBUs are captured by Licence
Plate Recognition (LPR) software, and drivers are charged at a later date.

These systems are still heavily used in Portugal, Norway, Italy, France and
Spain ? incidentally also the largest markets for ETC in Europe with about
80% of the present market between them.

In January 2001, the Swiss government implemented its distance-related
Heavy Vehicles Fee (HVF) system in an attempt to reduce the amount of heavy
transit traffic on its roads.  The system is a country-wide Road User
Charging system, which applies only to vehicles over 3.5 tonnes, and
approximately 60,000 tags are in use. The system is the first of its kind
in Europe, as it is the first to make use of Vehicle Positioning System
(VPS) technology. No toll plazas or gantries are required, except at the
entrance and exit points to the country, because vehicles are charged for
using all public roads in Switzerland, not just selected ones. Charges are
made according to the distance travelled, and this is tracked by Global
Positioning Satellites (GPS) via an OBU attached to the vehicle's
tachograph (a compulsory sealed instrument for checking the legal work and
rest hours requirements and for resolving accidents). Drivers pay
periodically by downloading all their trip data from the OBU onto a smart
card. The data consists of a detailed list of all events, together with
date, time and mileage reading. The data is then sent to a billing centre
by post or e-mail. The billing centre calculates the fee and invoices the
vehicle owners.

The German government has announced that it will introduce a similar system
for commercial vehicles over 12 tonnes in 2003, and Austria will follow
suit in 2004. In Germany around 750,000 transponders will be ordered
initially. This is expected to be followed by a number of countries
introducing RUCs for passenger cars either region- or country-wide.

The first of these countries is likely to be the Netherlands, where plans
have been on the table since 1989. If the Dutch authorities decide to go
ahead with the system, the size of the European OBU market would treble in
size overnight, as it would require the installation of OBUs in all
vehicles.

By far the major player in the European microwave OBU market is Q-Free with
75% market share, followed by Combitech with 17%. Other players include
GEA, CS Route, FELA, Ascom and Autostrade with less than 5% each.

Suppliers of the OBUs in the Switzerland HVF scheme are a consortium of
Ascom and FELA management AG, of which the microwave component is supplied
by Q-Free in a sub-contract to Combitech. It remains to be seen who will be
the major players in the future, however, contenders for the German scheme
are Vodafone Pilot Entwicklung, Deutsche Telekom (in a consortium with
Debis and Tegaron), and FELA/Ascom. In Austria, FELA/Ascom, Ericsson and
Austrian mobile telephone operator "One" are competing, and Computer
Management Associates is also interested in entering the VPS market.

A further technology is Licence Plate Recognition (LPR) software, such as
that to be introduced in the London Road User Charging scheme in January
2003. Whilst this system does not require the use of OBUs in vehicles, it
is a technology that could grow from the current 0% to 5-10%, depending on
the success or failure of the London scheme.

Background
These findings have been taken from Frost & Sullivan's upcoming report, The
European Market for Intelligent Transportation Systems (BO26). This report
is expected to be published in November 2001.

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