**NEW JERSEY DEPARTMENT OF TRANSPORTATION IMPLEMETING PAY**  **- AS**  **- YOU**  **- DRIVE INSURANCE, STATEWIDE**  **RACM Analysis Control Measure:**  Implementing pay - as - you - drive (PAYD) insurance statewide. **Description:** Insurance premiums are based directly on how much driving is done during the policy term. The more the consumer drives, the more they pay. Conversely, if the consumer drives less, they save. A per -unit premium would be used, i.e., per - mile, per -minute, etc. Existing rating factors could be included in the per -unit premium. For example, higher risk drivers would pay a higher per unit premium. **Documentation:**  American Petroleum Institute, State Motor Fuel Excise Rates as of July 1, 2005. www.api.org  Department of Energy, Energy Information Administration (EIA), Retail Gasoline Prices: http://www.eia.doe.gov/oil_gas/petroleum/data_publications/wrgp/mogas_home_page.html  Center for Clean Air Policy Guidebook: www.ccap.org/guidebook  Vict oria Policy Institute. Pay - As -You - Drive Vehicle Insurance, Converting Vehicle Insurance Premiums Into Use - Based Charges: www.vtpi.org/tdm/tdm79.htm **Methodology :**  The total annual and daily affected VMT were calculated. Emission factors were then applied to obtain the emission benefits of instituting a PAYD insurance program statewide. **Inputs/A ssumptions:**   Insurance is optional and is expected to have a 5% participation rate in 2009  Imposing a mileage fee o f $0.06/mile is assumed to reduce VMT by 10%  VMT and emission factors obtained using MOBILE6.2 **Results:** Total Affected VMT: Daily: **639,517** miles/day Annual: **223,696,132** miles/year Statewide Benefits (Emission Reductions):

**Pollutant Ty**  **pe An**  **aly sis Year**  **2009**

tons/day tons/year **VOC** 0.38 NA **NOx** 0.36 146.00 **PM2.5** NA 17.50 **SO2** NA 0.56 *Statewide emission benefits include counties not included below**NEW JERSEY DEPARTMENT OF TRANSPORTATION IMPLEMETING PAY**  **- AS**  **- YOU**  **- DRIVE INSURANCE, STATEWIDE**  **RACM Analysis** Ozone Analysis – Daily Benefits (tpd) in New Jersey:

**Benefits (Reductions)**  **Ozone Non -** **At tainment A**  **re a**  **NY -**  **NJ -**  **CT PA**  **- NJ**  **- MD**  **- DE**  **VMT** 455,611 183,905 **VOC (Tons/Day )**  0.26 0.12 **NOx (Tons/Day** **)** 0.26 0.10 PM 2.5 Analysis – Annual Benefits (tpy) in New Jersey:

**Benefits (Reductions)**  **PM 2.5**  **Non -** **At tainment A**  **rea NY**  **- NJ**  **- CT**  **PA -**  **NJ -**  **DE VMT**  155,663,911 39,687,396 **NOx (Tons/Year)** 101.20 26.41 **PM2.5 (Tons/Year)** 14.20 0.54 **SO 2**  **(Tons/Year)** 0.22 0.32 Cost Benefit Results: **Inputs/Assumptions:**  Retail gasoline price = $2.40/gallon.  An average fuel economy of 25 miles per gallon was assumed.  A total of 250,000 vehicles will participate in the program in 2009.  Each participating vehicle will pay $30.00 per year for audits.  Insurance premium savings are based on the $.06/mile fee and the resulting 10% decrease in VMT.  The costs were analyzed from a consumer benefit standp oint. The costs resulting from performing the yearly audits (operations, administrative, etc.) and any lost premiums to insurance companies were not accounted for in these calculations.  Three mileage categories were established and the participating vehic les were divided among the categories in each nonattainment area as follows:

**Mileage Category Percent of Total** 

**Participants Ozone**  **PM2.5** < 6,000 65% 76% < 12,500 25% 20% < 18,000 10% 4%**NEW JERSEY DEPARTMENT OF TRANSPORTATION IMPLEMETING PAY**  **- AS**  **- YOU**  **- DRIVE INSURANCE, STATEWIDE**  **RACM Analysis Nonattainment A**  **rea Ozone ($/tpd)**  **VOC NOx**  NY- NJ - CT $ (2 10,645) $ (212,528) PA- NJ - MD - DE $ (181,581) $ (214,825) Statewide $ (201,376) $ (213,184) **Nonattainment A rea**  **PM2.5 ($/tpy )**  **NOx PM2.5**  **SO2** NY- NJ - CT $ (180,491) $ (1,286,808) $ (85,120,322) PA- NJ - DE $ (176,386) $ (8,747,854) $ (14, 341,833) Statewide $ (179,641) $ (1,556,597) $ (42,499,091) * Parentheses denote a cost savings.