External costs in inland waterway transport: A comparison with road and rail transport

External costs of freight transport will become much more important in transport mode decisions due to future measures such as CO2 taxes. Inland waterway transport has significantly lower external costs than road and rail transport, thus demonstrating its potential as a sustainable transport mode.

External costs of freight transport represent the monetary assessment of air pollution and climate change as well as other emissions and impacts such as noise, accidents, congestion and habitat damage. These costs of transport are generally not borne by transport users and are therefore not taken into account when making a transport decision. The future internalization of external costs through measures such as emission taxes will mean that these costs will have to be taken into account when making transport choices.

A systematic literature review and analysis of the external costs of inland navigation has shown that inland waterway transport has clear advantages over road transport in this respect (Hofbauer & Putz, 2020). The study showed that external costs caused by accidents, noise, congestion and habitat damage were considered very low and not relevant for inland waterway transport. These cost categories have the potential to highlight some of the benefits of inland navigation that could play a role in the future internalization of external costs. The advantage of low external costs compared to road transport should be highlighted with appropriate data and calculations to promote the positive aspects of inland waterway transport in terms of sustainability.

Inland waterway transport also has clear advantages over road transport in terms of external costs of climate change and well-to-tank emissions. However, the poorer values regarding air pollution costs highlight the need for measures to reduce air pollutants in inland navigation. The measurement of energy consumption and related emissions of inland navigation should be improved qualitatively and quantitatively and raised to the level of road transport in order to ensure an accurate comparison of related external costs with other transport modes.

To illustrate the external costs of the Danube area, the average external costs of freight transport in the Danube countries were calculated on the basis of national data from the Handbook on External Costs of Transport (Schroten et al., 2019). For this purpose, a weighted average of the national average external costs of the EU Danube countries Austria, Bulgaria, Croatia, Germany, Hungary, Romania and Slovakia was calculated.

 Image: Own calculation, based on data from (Schroten et al., 2019)

The bar chart shows that inland waterway transport (IWT) has significantly lower external costs (1.33 €-cent/tkm) than road freight transport (4.89 €-cent/tkm) and performs better than rail freight transport (1.55 €-cent/tkm). IWT has clear advantages over road transport in terms of accident costs (Acc), congestion costs (Cong), noise costs (Noise), habitat damage costs (Hab) as well as climate change costs (CC) and costs due to well-to-tank emissions (WTT). Compared to rail transport, IWT has significantly lower noise costs as well as costs due to habitat damage.The external costs of air pollution are the main external cost factor of IWT. For this reason, the European Union has set new Stage V emission limits for new engines in IWT, which should lead to a drastic reduction of air pollutants from IWT in the future. The EU projects PROMINENT (Schweighofer et al., 2018) and GRENDEL (Interreg Danube Transnational Programme, 2020) investigated the most suitable technical options for achieving the new emission limits. Both projects illustrate that there are already numerous technical measures (e.g. LNG, diesel hybrid, after-treatment) that would fulfill the Stage V emission limits. However, a one-size-fits-all solution does not seem feasible for inland waterway transport, as the types of vessels and operating profiles differ too much.  The technologies have in common that funding schemes are necessary to cope with the considerable costs of technical optimization. As regards to that, policy action is still needed both at national and EU level.




  • External costs will be internalized in the near future an should be taken into account when making transport choices
  • External costs of transport of IWT has significantly lower external costs than road transport
  • IWT has high reduction potential in terms of air pollution and needs funding schemes for the technical optimization of the fleet


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Hofbauer, F., & Putz, L.-M. (2020). External Costs in Inland Waterway Transport: An Analysis of External Cost Categories and Calculation Methods. Sustainability, 12(14), 5874. https://doi.org/10.3390/su12145874

Interreg Danube Transnational Programme (2020). GRENDEL - Green and efficient Danube Fleet. Retrieved from http://www.interreg-danube.eu/approved-projects/grendel

Schroten, A., van Essen, H., van Wijngaarden, L., Sutter, D., Parolin, R., Fiorello, D., . . . Bieler, C. (2019). Handbook on the external costs of transport: Version 2019. Luxembourg. https://doi.org/10.2832/27212

Schweighofer, J., Bäck, A., Verbeek, R., Abma, D., van Mensch, P., Creten, S., . . . Putz, L.-M. (2018). PROMINENT D6.4 Final pilot-review report. Retrieved from http://www.prominent-iwt.eu/wp-content/uploads/2018/07/2018_04_30_PROMINENT_D6.4_Final_Pilot_Review_Report.pdf