Electronic toll now has 75% share in Japan - plaza congestion banished but costly problems remain

by Kodo Ogata, Tokyo – Despite a late start Japan's electronic toll (ET) penetration has increased hugely to 75% of transactions - as of the first week of Sept 2008.  (The US rate is below 70% - Editor) This is especially amazing since Japan was so far behind the US in implementation of ET (2001 on vs 1989 to 2000 for most US tollers.)

The good news from Japan's implementation of ET is that almost all plaza-related recurrent daily congestion has disappeared from Japan's toll expressways. Toll collection is no longer the major site for congestion. In that regard Japanese electronic toll collection (ETC) has been an almost total success story.

When it started operation in 2001, the uptake of transponders was at first slow, mainly due to the high priced transponder (OBU) about $400 (40,000 yen). Peter Samuel criticized in Toll Roads Newsletter the Japanese transponder as “feature goldplated” and “Porsche/Bose priced”.

The system is still cumbersome though the immediate cost to the consumer has been reduced over time.

Most transponders used in Japan come in three parts:

- main body of the on board unit (OBU) comprising memory, processor, card reader and feedback

- the antenna

- a ETC payment card linked to a credit/debit card

No Japanese transponders have their own battery, so they must be hardwired to the car or truck battery. And unlike American transponders they have a slot for a special payment card.

In addition to buying the transponder the driver must pay about $80 (8,000 yen) to “set-up” the transponder with a visit to an accredited garage or automotive products stores.

This charge covers:

- inputting required vehicle data to transponder memory such as license plate, vehicle ID, toll class etc

- fixing the transponder and antenna correctly in the vehicle

- providing vehicle-battery power connections to the transponder

Some new models of Japanese cars come from the factory with the toll transponder built-in, the transponder being in the dashboard and the antenna built into the rear vision mirror with wiring neatly concealed.

However the typical models are the "three part" aftermarket assembly.

Supervised central system

This is all planned and controlled by an Organization for Road System Enhancement (ORSE). ORSE was set up by the Ministry of Land, Infrastructure, Transport & Tourism (MLIT), funded by automobile, electronic and credit card companies.

Non-executive Chairman Fujio Chou, former president of Toyota Motor Corporation heads ORSE. Several non-executive directors from funding companies have seats, and executive directors are mainly retired high-level bureaucrats of MLIT.

ORSE is one of the important organizations providing what commentators call “golden parachutes” for senior officials on the way out of MLIT and related organizations.

Another process is necessary before the transponder can be used. The driver must get an ETC card from a credit card company or bank. The card inserted in the slot in the transponder must be valid for the toll gate to open.

see http://www.go-etc.jp/english/index.html

24 million toll transponders are now in use in Japan.  (Probably a million or two more than in the US - Editor) They now do 5.6 million toll transactions per day.

Price brought down to $150

The price of transponders has come down steadily from the initial $400 (Y40k is now about $150 (Y15k.)

The 5.8GHz antenna must be attached to the back side of rearview mirror.

The OBU body is typically attached near the level of the driver's hands to be convenient for card insertion.  A speaker in the OBU provides announcements as customer feedback, a synthetic voice telling the motorist: "You just paid the 700 yen toll."

To many people this system is unnecessarily cumbersome and expensive.

Yet it has now achieved a very high uptake despite these costs. This has been achieved by a variety of subsidies and discounts orchestrated by MLIT and ORSE, so the out-of-pocket costs of getting the transponder do not seem so large to the customer.

Subsidies

From May of 2003 $50 per transponder (5,000yen) was subsidized via the tag-shop.       

And the toll discount for the ETC users started, too. Discount has been escalated year by year. Now, in some period of time, in many sections of expressways, toll is discounted half only for ETC users.

There was popular discount system named “Prepaid Toll Card” for non-ETC users before. For example, a 50,000 yen prepaid card had additional 8,000 yen in value installed. A 30,000 yen card had additional 2,500 yen. This system had to be abolished by the direction of MLIT, from the spring of 2004 (H17), starting from the higher value one, and was completely abolished by April of 2006 because of the expense.

The effect of these measures can be seen in the “Usage Trend” graph nearby.

Promoting move from flat rate to distance based tolling

The Shuto (Metropolitan Tokyo) and Hanshin (Osaka Kobe area) toll expressway companies were enthusiastically eager to expand ETC usage because they had been planning to convert the old “single rate toll system” to a new “distance based toll system” (distance based but with a ceiling.)  The old metro area toll system in Japan consisted entirely of an entry ramp toll, making the toll for the trip the same regardless of which exit the driver uses and the distance of the trip.

Electronic tolling was key to this changeover to distance based tolling which was to have been implemented this fall/autumn.

Shuto Exp. Co. collects $7 (700 yen) toll from smaller vehicle and $14 (1,400 yen) from larger ones under the longstanding single toll rate regime. They planned to set the distance “adjusted” toll as the first step in the range between  $3 (300 yen) and $12 (1,200yen) for a smaller vehicle, and double that toll for a larger one.

Even this moderate compromise plan met strong opposition from trucking and motorist organizations. Last month the government decided to "postpone" the switchover for one year at least. One ratiuonale for this was that it would help offset  soaring motor fuel price.

There was problem in their plan also in the handling of non-ETC users. 

No VES in Japan

ET in Japan has a fundamental defect. There is no video enforcement, so all toll points in Japan retain a gate to prevent violations. Even so the gate bar is covered with soft sponge rubber to protect a car driven too eagerly through the toll gate. As a consequence a toll evader can easily get away with pushing through the toll gate.

An increasing number of toll gates cameras to record license plates of evaders pushing through toll gates.

Under Japanese law it is only the driver who is responsible for toll evasion or other infractions, not the owner of the vehicle. This legal issue makes video enforcement impossible. It is even difficult to catch the drivers who push aside or break a toll gate.

To date police have rarely arrested even the dangerous and repeat offenders among the gate pushers. The number of these gate-breaking/pushing toll evaders is estimated about 1 million a year. The damage to the gate mechanism means that gates malfunction quite frequently causing delays.

Forgetting to insert the ETC card

The use of ETC cards simplifies payment for toll expressway companies as compared to the American and European practice of establishing a toll account.  Different toll companies do not need to exchange account lists or exchange the net  balances (as in the IAG, Sunpass, or TxTag).

However the card payment has a downside. Insufficient funds in the ETC card or forgetting to insert the card neans that no toll payment is registered and the gate stays closed.

(In the US we say "down" but many Japanese toll gates swing open horizontally. Editor)

Also multipath (signal bounce) causes the normal small percentage of non-reads which keep the gate down even for a driver with a valid account. (Under the typical American system the motorist continues through and the vdeo image is used to identify the vehicle and the account to be debited. Editor)

Toll lanes are posted for 20km/hr (12mph) but many drivers go faster. Drivers coming to an unexpected halt are a regular source of rear-end collisions and blockage of toll lanes.

To settle a malfunction or nonpayment when the gate does not rise or swing open a toll collector must go to the driver with the problem who is blocking a lane, often crossing the ET lanes. It’s dangerous work. Five collectors have been killed and more have been injured dealing with such malfunctions since ET began seven years ago.

(Only at the Triborough Bridge & Tunnel Authority in New York City, among major US agencies is the gate held down and a toll collector dispatched like this. Editor)

One national system

Japan does have the benefit of one standard electronic toll system for the whole country so the single transponder and payment card can be used on any of the toll companies' networks anywhere in Japan. But many of us question the unnecessary expense of this very elaborate system and consider it is inefficiently managed by ORSE.

The centralized control also suppresses innovation and cost savings.

Highway speed multi-lane open road tolling will remain just a dream until the law is changed to allow video enforcement.

The system here has brought benefits but it operates at a heavy cost for the toll companies and ultimately for consumers. The centralization of ORSE has slowed implementation of modern technology and the Japanese driver is denied the benefit of many innovations employed elsewhere.

Many call ORSE the retirement home for old highway bureaucrats.

Kodo Ogata is a veteran toll industry man in Japan. He writes and consults on highway technology.

TOLLROADSnews 2008-10-09 (SMALL AMENDMENTS 2008-10-10 13:45)