Emission trading scheme for emission reduction and equity promotion in multimode networks with heterogeneous users

Air pollution caused by high transport-related emissions is already a serious problem, whereas user heterogeneity results in most of the existing emission reduction instruments cannot being applied in practice, despite reducing social inequity. In this paper, we propose an emission trading scheme (ETS) based on a dual-market mechanism in a multimode network with heterogeneous users in value of time (VOT), in order to primarily achieve the objective of emission reduction while taking equity promotion into account. Specifically, emission permits are issued in the primary market and travelers trade permits freely in the secondary market by bearing transaction cost which are assumed to be asymmetrically split between buyers and sellers. The High-Occupancy-Vehicle-based cyclic carbon emission permit (HOV-based CCEP) scheme is applied in the ETS as permit charges to better achieve the objectives. Unlike the previous studies of charging scheme, the compensatory permit rates in our model could be charged from private car (PC) passengers, waived for customized bus (CB) passengers and subsidized for public transit (PT) passengers. The market trading processes considering transaction cost and travel choice behaviors are formulated as a variational inequality problem (VIP). The multimode equilibrium solution of which is obtained by developing a relaxation algorithm with a multi-round iteration strategy. Finally, we conduct numerical experiments based on Braess and Sioux Falls networks to demonstrate the merits of the proposed model and reveal the results that highlight the importance of ETS and multiple public transport modes in the heterogeneous system for emission reduction and equity promotion.