Chicago Green Taxi Blueprint Lydia Bowers Roosevelt Summer Academy 2011 Introduction Chicago is preparing itself for

the future. In order to adapt to global climate change, Chicago has embraced a Climate Action Plan. One part of this plan encourages the taxi industry to convert to green vehicles. Realizing the environmental and economic benefits of alternative fuel and hybrid taxis, hereby referred to as green taxis, Chicago has had some success in placing green vehicles on the road. Chicago must take further steps to set high yet achievable goals in alternative fuel / hybrid implementation. The following blueprint outlines the history of this program and the steps the City of Chicago could take to transition its taxi fleet from the present level of 6% green taxi use to 39% green taxi use by the year 2015. History Chicago’s Green Taxi Program partially reimburses taxi vehicle owners who purchase alternative fuel vehicles. Under the program, hybrid vehicles are reimbursed $2,000 dollars and alternative fuel vehicles are reimbursed the full conversion cost, typically between $7,000 - $12,000 dollars. As of summer 2011, Chicago has approximately 400 hybrid cabs and will soon have an additional 30 alternative fuel vehicles. These vehicles comprise only 6% of the operating taxi fleet of approximately 6,700. Other cities are doing much better. In the past ten years, San Francisco has dramatically increased the number of green taxis in their fleets. As of 2010, 55% of San Francisco’s taxicabs run on alternative fuel. This growth has put San Francisco and other cities at the forefront of the green movement, given their residents access to alternative fuel infrastructure and improved the city’s environment. Goal Setting What additional steps should Chicago take in order to have a green taxi fleet? First, Chicago should set concrete realistic goals for green taxi growth by year. Achieved growth statistics will be successes to promote to the general public and media. Two years after the Mayor of San Francisco set a goal for carbon emissions for the taxi industry, the taxi fleet had transitioned to 55% green. This achievement demonstrates both the power of goal setting and the power of the Mayor’s office. Of course, San Francisco and Chicago are very different. Chicago’s taxi fleet is nearly three times the size of San Francisco’s. When setting achievable growth goals, Chicago policy makers should anticipate a longer transition time due to the large taxi fleet.

Another factor to consider when setting achievable goals deals with the use cycle of a Chicago taxi. Due to the four year use cycle, about ¼ of Chicago’s taxis must be replaced every year. Green taxi growth will occur mainly through this replacement avenue. With an increase in education and incentives to draw industry attention and support, Chicago could expect 1/3 of these replacement cars would become green, about 530 a year. This would equate to around 8% of the entire fleet converting to alternative fuels or hybrids per year (see table 1). By 2015 Chicago could expect to have a taxi fleet comprised of 39% green taxis (see table 2). Table 1

Recommended Growth of Chicago Green Taxis Year 2011 2012 2013 Number Of Green Taxis 430 988 1546

2014 2104

2015 2662

Table 2

Recommended Vehicle Mix of Chicago Taxi Fleet Year Green Fuel Vehicles Traditional Fuel Vehicles 2011 6% 94% 2012 14% 86% 2013 23% 77% 2014 31% 69% 2015 39% 61%

Phase One - 2011 Phase One of green taxi implementation began in 2011 with the Green Taxi Program. By reimbursing drivers who purchase hybrid and alternative fuel vehicles, up to a set amount, the City of Chicago began the process of transitioning its taxi fleet for the future. The Green Taxi Expo, held in July of 2011, increased industry awareness and education about alternative fuel and hybrid vehicles. The growth of green taxis suggested in my graph for 2011 is predicated on the continued success of the Green Taxi Program. The Green Taxi Program also offered “fast lane” use at both Chicago airports for alternative fuel vehicles. This benefit increased education about alternative fuel vehicles. Now that the taxi industry is informed about alternative fuel and hybrid vehicles and early adopters have set the example for the industry, further incentives should lead to continued adoption of this technology. Several options are available in this effort and could be spread out over the course of the next four years to encourage continuous growth of green taxis. Phase Two – 2012/2013 After the Chicago Green Taxi program expires on December 31st, 2011 and the Fast Lane Pilot Program expires on February 5th, 2012, Chicago must invent new ways to encourage green taxis purchases. Perhaps the most effective way to encourage green taxi purchases

would be the passing of a city ordinance to raise lease fees on hybrid and alternative fuel taxis. As 1/3 of Chicago’s taxi fleets are owned by large companies that lease vehicles to drivers, this ordinance could be an effective way to encourage green taxi development. San Francisco successfully utilized this method, raising lease rates by $7.50 for alternative fuel and hybrid taxis. A similar lease rate increase program faced some opposition in Boston and New York City from the traditional taxi industry so it is essential for the city to stress that this program is an incentive for green cabs. There will also be some opposition from cab drivers who have to pay these higher lease fees. Drivers will be able, in part, to offset an increased lease rate through fuel savings from hybrid and alternative fuel vehicles. However the City of Chicago should not raise lease rates without first exploring the city mandated taxi fares and other fees leveled on taxi drivers. In a recent newspaper article by the Chicago Dispatcher, Chicago ranked second to last of 34 American cities and areas in taxi fare for a five mile trip with a five minute wait time. Increased fares benefit the general public as well as drivers. In a 2004 article, transportations industry specialist Bruce Schaller wrote about the “recognition that both taxi owners and drivers and the public benefits when driver incomes increase. Drivers obviously benefit from higher incomes. To the extent that higher incomes attract a stable and committed driver workforce, the quality of cab service is also likely to improve.” 1 He also references a report that concludes higher taxi driver income results in fewer accidents. Phoenix, Arizona’s taxi fare is currently 33% higher than Chicago’s and yet Phoenix has a lower cost of living than Chicago. This shows that the city of Chicago can support a modest increase in taxi fares to both fund green taxi implementation and help cab drivers earn a wage equal to those earned in other cities. A modest increase of .5 cents per unit traveled would bring Chicago’s taxi fares into a more equitable comparison with other cities. Phase Three – 2014 By 2014 the city will need a final push to achieve its goals for green taxi adoption. In 2014, the City of Chicago in partnership with the State of Illinois could explore the option of waiving the airport fee for Green Taxi use. San Francisco has also successfully instituted this policy. This project would need to be a city/state partnership as it is the state that collects this fee. But, as airport rides tend to be the longest taxi rides in the city, encouraging green taxi use to and from the airport has the potential to greatly improve city air quality. Also, as the taxi ride from the airport to the city is the first impression of the city for many visitors, green cab use at the airport would raise Chicago’s world cab city reputation.

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