Posted on Tue, 10/12/2021 - 22:07
However, have you ever considered the true cost of parking, and what uses could we make of that space if we could solve the personal mobility challenge with only a fraction of current parking demand? Fewer parking lots, and the elimination of street parking and driveways would certainly make our communities more attractive and people friendly.
A new research report, released in October 2021 estimates that the annual cost to the average Canadian for personal vehicle parking is a whopping $1452 per year. For the average household of 2.6 persons, that amounts to $3775/year and for all Canada, we are looking at an annual bill of over $52B/ year, equivalent to about 3% of Canada’s gross domestic product.
Most of the parking costs are embedded in what Canadians pay for their residences, and what they pay for goods and services from commercial and institutional sectors that provide ‘free’ parking. Taking these costs into account positions parking at about 25% of the cost of personal vehicle ownership (Figure 1), equivalent to what the average Canadian pays for fuel plus vehicle maintenance in a year. Compared to other components of cost, the annualized cost of parking is second only to the cost of vehicle purchase or lease (Figure 1).
Figure 1. The cost of personal vehicle ownership and use in Canada (A) and Alberta (B).
All values are from Statistics Canada (Table: 11-10-0222-01) except the cost of parking which is estimated in the Transition Accelerator study by calculating the embedded costs of parking associated with residential, commercial, and institutional facilities.
The study was carried out by the Canadian Energy Systems Analysis Research (CESAR) initiative at the University of Calgary with support from the Alberta Real Estate Foundation and the Transition Accelerator.
The report entitled “Autonomous vehicles, parking and the real estate sector in Alberta and Canada” explores the potential implications of a shift to Autonomous Mobility-on-Demand (AMoD), where fleets of autonomous, connected and driverless vehicles will pick up and drop off passengers, effectively replacing the need for personal vehicle ownership, and the parking spaces they currently use.
On the Cusp of Transformative Change?
While fully autonomous vehicles are not commercially available today, limited self-driving features are increasingly common in new vehicles, and companies around the world are investing billions to be among the first to develop and prove fully autonomous capability. Their target is the multi trillion-dollar global personal mobility market which is ripe for disruptive change. AMoD vehicles promise to provide a more convenient, safer, and lower cost service.
How does Alberta Compare to Canada?
On a per capita basis, Alberta has more light duty vehicles (LDV) than the Canadian average (0.73 vs. 0.62 LDV/person, respectively), and more parking spaces per vehicle (4.3 to 5.8 for Alberta vs. 3.2 to 4.4 for Canada). Consequently, the annualized cost of providing this parking in Alberta is estimated to be about 30% higher than the Canadian average.
For example, in Canada today, vehicles cost many 10’s of thousands of dollars but are typically used for only 1 to 1.5 hours/day, so 95% of the time, they are parked on some of the most expensive land in Canada. Providing a lower cost, private and convenient mobility service would not only reduce the cost of getting from ‘A’ to ‘B’ but could have significant knock-on benefits in lower costs for housing, as well as goods and services if personal vehicle parking no longer needs to be provided.
The Scale of Parking Infrastructure
The report estimated that Canada has 71 to 97 million parking spaces for the 23 million light duty vehicles in the nation, or 3.2 to 4.4 parking spaces for every vehicle in Canada. About 40% of these spaces are associated with the residential sector, 26% with commercial and institutional sectors, and the balance are ‘on-road’ spaces.
AMoD and Vehicle Electrification
Research has shown that just one AMoD vehicle has the potential to provide the service that is currently met with about 8 personally owned vehicles. Therefore, in a city like Calgary with about 1 million cars on the road, 150,000 AMoD vehicles should be able to provide equivalent or better service. Of course, each AMoD vehicle will need to drive at least 8 times more than a typical personally owned vehicle (AMoD vehicles will need to move empty between customers), but that level of use is expected to strongly favour electric vehicles over internal combustion engine vehicles since the former have lower maintenance and lower fuel costs.
Hence, the movement to AMoD vehicles could become a major force in the transition to zero emission vehicles in Canada’s personal mobility sector. AMoD vehicles could also become a significant driver in the transition to a hydrogen economy. Compared to battery electric vehicles, hydrogen fuel cell electric vehicles can refuel faster, and drive further; features that could deliver a competitive advantage in an AMoD future.
How soon will this happen?
While advances in sensor and artificial intelligence technologies have been rapid, it will be many years before we see fully autonomous vehicles on the road, despite what some company executives have claimed. The early market entrants are likely to be heavy trucks running on major highways, but many years will past before we see AMoD vehicles replacing personally-owned cars on our city streets. While it is very difficult/impossible to accurately predict the future, there certainly is a movement towards vehicle autonomy and the AMoD business model. This is a trend worth watching and, if necessary, ‘nudging’ to ensure it is deployed in a way that improves our cities and enhances the quality of life for Canadians.
Implications for the Real Estate Sector
The transition of the business model for personal mobility from personal vehicle ownership to AMoD, could reduce household expenses, and increase disposable income. Implications of AMoD for the real estate sector include:
- The transition to fully autonomous vehicles is likely to begin with luxury, personally owned vehicles that will be able to drop off their owners and drive themselves to lower cost parking lots. Strategically located, higher cost parking lots will lose customers and value.
- Urban public transit is likely to be an early adopter of AMoD vehicles, especially in providing first mile/ last mile services to connect to commuter trains and express buses. This could reduce demand for second vehicles in households, as well as parking at transit stations.
- Widespread deployment of AMoD has the potential to dramatically reduce the use of, and demand for personally owned vehicles. In the residential sector, this may result in:
- Removal of driveways, and conversion of garages to secondary suites, laneway housing, etc
- A movement against personal vehicle parking on streets, in favour of pick up and drop off (PUDO) locations, bicycle lanes and wider sidewalks,
- Unused parking lots/ parkades associated with condominiums and apartments,
- Elimination of minimum parking requirements for new residential construction, but new demands for safe and convenient PUDO locations.
- In the commercial and Institutional sectors, AMoD deployment may result in:
- Demolition or refurbishment of above ground parking facilities so they can be repurposed,
- Surface parking converted to other uses, including increases in densification or greenspace,
- More attention being paid to PUDO locations and designs.
- Underground parking facilities will either be taken over by companies providing AMoD fleets or be allocated to other uses.
- Reducing or eliminating street parking to allow more ‘people-friendly’ places.
- Phasing out of car dealerships, fueling stations, vehicle service facilities etc.
- A need to rethink how strip malls, box stores, shopping malls and specialty shops will need to adapt to a new business model for personal mobility.
While much uncertainty exists regarding the timing of the transition to AMoD, there is widespread understanding that this is the direction society is headed, driven by economics and convenience. The real estate sector can benefit from understanding, advancing and adapting to the transition.