A few months ago, my wife and
I decided that it was time to purchase a newer car for our family. Our two
vehicles were old—my pickup is a 1993 Toyota T-100, and the family minivan is a
2002 Toyota Sienna, both closing in on 200,000 miles—and maintenance costs on
both have been increasing. I drove over to Jim Barkley Toyota and walked into
the sales room, where I was cheerfully greeted by one of their sales
associates. I told him that I was interested in a slightly used Prius, the
ubiquitous hybrid vehicle Toyota has sold since 2000. “Oh sure, we have plenty
of those here,” he replied, continuing that he “couldn’t keep a truck on the
lot” with gas prices so low. As a consumer, this was great news for me, but as
an environmentalist, this reality disturbed me. That got me to thinking: Is
there really that predictable of a relationship between gasoline price and the number
of trucks and SUVs sold?
The answer is yes. For the 13
years from 2003 through 2015, there is a very strong, negative linear
relationship between gasoline price per gallon (inflation-adjusted) and
percentage of vehicles solid in the U.S. that are trucks and SUVs. (The
regression outlier is from 2009, during the recession.) Translated into
everyday terms, this means that when the price of gasoline is low, we buy more
vehicles that are larger and less fuel-efficient, and when the price of
gasoline is high, we turn to smaller, more fuel-efficient cars.
I’m all for consumer choice,
so if my neighbor needs or wants a larger vehicle, then so be it. (After all, I
own two of them!) However, a big problem is that the price per gallon we pay at
the pump is not nearly the real cost of that gallon of gasoline to you and me
as individuals and to society in general, if all external costs are considered.
In a peer-reviewed journal article published in 2015, Professor Drew Shindell
of Duke University estimated the environmental damages per gallon of gasoline
to be $3.80, the damages including the shared burden of global mean climate
change and global health burdens from poor air quality. Paying $6.00 or more per
gallon of gasoline would be a tough pill to swallow for Americans, who’ve become
quite accustomed to buying relatively cheap gasoline, but we ultimately end up
paying for these external costs in other ways, such as in higher medical costs
and higher home insurance premiums.
What’s to be done? Placing a
price on carbon would go a long way. Fossil fuels companies would pay a fee per
ton of carbon extracted, and of course they would pass along these costs to us,
the consumers. We would face a choice: Buy the larger, less fuel-efficient
truck, or go for the smaller, fuel-efficient option, given that the price at
the pump would be higher, because the price of the gallon of gasoline would be
closer to the real cost of burning it. Undoubtedly, more of us would choose the
more fuel-efficient models. The projected extra cost on a gallon of gasoline
would be approximately $0.15 per gallon upon implementation, and increasing
roughly $0.10 per gallon per year. At some point, many consumers would choose a
more fuel-efficient vehicle.
It is important to note that,
under a Carbon Fee and Dividend (CF&D) model, the carbon fee collected would
be returned to households each month, so this approach is revenue-neutral from
a government standpoint. The best news from both a societal and an environmental
perspective is studies predict that, during the first 20 years alone, a comprehensive
CF&D policy (one that includes all fossil fuels—coal, oil and natural gas—and
other greenhouse gases) would lead to a 50% reduction of carbon emissions below 1990 levels; the addition of 2.8 million
jobs, driven by the economic stimulus of the energy dividend; and the avoidance of 230,000 premature deaths due to reduction
in air pollutants that often accompany carbon emissions.
All we need is the political
will to make this happen, to the betterment of us all.
No comments:
Post a Comment