Recent advances in automotive technology and the cost-effectiveness of fuel economy improvement

The potential for improving the fuel economy of conventional, gasoline-powered automobiles through optimized application of recent technology advances is analyzed. Results are presented at three levels of technical certainty, ranging from technologies already in use to technologies facing technical constraints (such as emissions control problems) which might inhibit widespread use. A fleet-aggregate, engineering-economic analysis is used to estimate a range of U.S. new car fleet average fuel economy levels achievable given roughly 10 years of lead time. Technology cost estimates are compared to fuel savings in order to determine likely cost-effective levels of fuel economy, which are found to range from 39 miles per gallon to 51 miles per gallon depending on technology certainty level. The corresponding estimated increases in average new car price range from $540 to $790 (1993$). Estimated fuel savings payback times average less than 3 years and the cost of conserved energy averages $0.50 per gallon, indicating that these levels of fuel economy improvement are cost-effective over a vehicle lifetime. A vehicle stock turnover model is used to project the reductions in gasoline consumption and associated emissions that would follow if the estimated fuel economy levels are achieved. Potential trade-offs regarding vehicle performance, safety, and emissions are also discussed.     

Fueling for contingencies: The hidden cost of unpredictability in the air transportation system

The aviation community is increasing its attention on the concept of predictability when conducting aviation service quality assessments. Reduced fuel consumption and the related cost is one of the various benefits that could be achieved through improved flight predictability. A lack of predictability may cause airline dispatchers to load more fuel onto aircraft before they depart; the flights would then in turn consume extra fuel just to carry excess fuel loaded. In this study, we employ a large dataset with flight-level fuel loading and consumption information from a major US airline. With these data, we estimate the relationship between the amount of loaded fuel and flight predictability performance using a statistical model. The impact of loaded fuel is translated into fuel consumption and, ultimately, fuel cost and environmental impact for US domestic operations. We find that a one-minute increase in the standard deviation of airborne time leads to a 0.88 min increase in loaded contingency fuel and 1.66 min in loaded contingency and alternate fuel. If there were no unpredictability in the aviation system, captured in our model by eliminating standard deviation in flight time, the reduction in the loaded fuel would between 6.12 and 11.28 min per flight. Given a range of fuel prices, this ultimately would translate into cost savings for US domestic airlines on the order of $120–$452 million per year.     

The impact of a carbon tax on international tourism

A simulation model of international tourist flows is used to estimate the impact of a carbon tax on aviation fuel. The effect of the tax on travel behaviour is small: A global tax of $1000/t C would change travel behaviour and reduce carbon dioxide emissions from international aviation by 0.8%. A carbon tax on aviation fuel would particularly affect long-haul flights, because of high emissions, and short-haul flights, because of the emission during take-off and landing. Medium distance flights would be affected least. This implies that tourist destinations that rely heavily on short-haul flights or on intercontinental flights will see a decline in international tourism numbers, while other destinations may see international arrivals rise. If the tax is only applied to the European Union, tourists would stay closer to home and European tourism would grow at the expense of other destinations. Sensitivity analyses reveal that the qualitative insights are robust.     

The effectiveness and costs of speed reductions on emissions from international shipping

Greenhouse gas emissions from international shipping are an increasing concern. The paper evaluates whether vessel speed reduction can be a potentially cost-effective CO₂ mitigation option for ships calling on US ports. By applying a profit-maximizing equation to estimate route-specific, economically-efficient speeds, we explore policy impacts of a fuel tax and a speed reduction mandate on CO₂ emissions. The profit-maximizing function incorporates opportunity costs associated with speed reduction that go unobserved in more traditional marginal abatement cost analyses. We find that a fuel tax of about $150/ton fuel will lead to average speed-related CO₂ reductions of about 20–30%. Moreover, a speed reduction mandate targeted to achieve 20% CO₂ reduction in the container fleet costs between $30 and $200 per ton CO₂ abated, depending on how the fleet responds to a speed reduction mandate.     

The Alternative Motor Fuels Act, alternative-fuel vehicles, and greenhouse gas emissions

The corporate average fuel economy (CAFE) standard is the major policy tool to improve the fleet average miles per gallon of automobile manufacturers in the US. The Alternative Motor Fuels Act (AMFA) provides special treatment in calculating the fuel economy of alternative-fuel vehicles to give manufacturers CAFE incentives to produce more alternative-fuel vehicles. AMFA has as its goals an increase in the production of alternative-fuel vehicles and a decrease in gasoline consumption and greenhouse gas emissions. This paper examines theoretically the effects of the program set up under AMFA. It finds that, under some conditions, this program may actually increase the production of fuel-inefficient gasoline vehicles, gasoline consumption and greenhouse gas emissions.     

Improving airline fuel efficiency via fuel burn prediction and uncertainty estimation

Reducing fuel consumption is a unifying goal across the aviation industry. One fuel-saving opportunity for airlines is the possibility of reducing discretionary fuel loading by dispatchers. In this study, we propose a novel discretionary fuel estimation approach that can assist dispatchers with better discretionary fuel loading decisions. Based on the analysis on our study airline, our approach is found to substantially reduce unnecessary discretionary fuel loading while maintaining the same safety level compared to the current fuel loading practice. The idea is that by providing dispatchers with more accurate information and better recommendations derived from flight records, unnecessary fuel loading and corresponding cost-to-carry could both be reduced. We apply ensemble learning techniques to improve fuel burn prediction and construct prediction intervals (PIs) to capture the uncertainty of model predictions. The upper bound of a PI can then be used for discretionary fuel loading. The potential benefit of this approach is estimated to be $61.5 million in fuel savings and 428 million kg of CO₂ reduction per year for our study airline. This study also builds a link between discretionary fuel estimation and aviation system predictability in which the proposed models can also be used to predict benefits from reduced fuel loading enabled by improved Air Traffic Management (ATM) targeting on improved system predictability.     

Abatement cost functions for incentive-based policies in the automobile market

This paper compares the outcomes of policies that target vehicle holdings with those that target vehicle usage using data from the US Consumer Expenditure Survey. Results show that a higher price of gasoline shifts vehicle holdings towards more fuel efficient vehicles and reduces the annual demand for miles, whereas imposing a fee on vehicles or a feebate program only shifts vehicle holdings towards more fuel efficient vehicles and has little to no impact on the demand for miles. While it is relatively expensive to reduce CO₂ emission through incentive-based policies, achieving any abatement level is more expensive through imposing fees on vehicles than gasoline taxes. In addition, the maximum amount of abatement attainable by a feebate program is relatively small and the same amount could be achieved by imposing a $0.73 gasoline tax per gallon.     

The costs and benefits of reducing SO2 emissions from ships in the US West Coastal waters

Potential costs and benefits of policy options for reducing offshore ship pollution are examined using a meta-analysis of studies synthesized regionally for the US West Coast. Net benefits of reducing SO₂ emissions from cargo ships in the US West Coast waters are found to range between $98 million and $284 million, annually; the benefit–cost ratio varies between 1.8 and 3.36, depending on the size of the control area and the sulfur content limit. The results show that about 21,000 tons of on-land equivalent SO₂ emissions or about 33% of SO₂ emissions from all mobile sources in California in 2005 can be reduced annually if the US West Coast exclusive economic zone is designated as an International Maritime Organization-compliant SO_x emission control area (SECA) with fuel-sulfur content not exceeding 1.5%. The analysis demonstrates that designating this area reduces more emissions than establishing a smaller zone at a lower but favorable benefit-cost ratio. Control measures that require 0.5% low-sulfur fuels reduce more SO₂ emissions, and also may have higher net benefits. Technological alternatives may achieve benefits of emissions reductions on the US West Coast across higher ranges of potential fuel prices. Combinations of fuel switching and control technology strategies provide the most cost-effective benefits from SECAs on the US West Coast and other world regions.     

Probabilistic assessment of aviation CO2 emission targets

Passenger demand for air transportation is expected to continue growing into the future. The increase in operations will undoubtedly lead to an escalation in harmful carbon dioxide emissions, an adverse effect that governing bodies have been striving to mitigate. The International Air Transport Association has set aggressive environmental targets for the global aviation industry. This paper investigates the achievability of those targets in the US using a top-down partial equilibrium model of the aviation system complemented with a previously developed fleet turnover procedure. Three ‘enablers’ are considered: aircraft technologies, operational improvements and sustainable biofuels. To account for sources of uncertainty, Monte Carlo simulations are conducted to run a multitude of scenarios. It was found that the likelihood of meeting all targets is extremely low (0.3%) for the expected demand growth rates in the US. Results show that biofuels have the most impact on system CO₂ emissions, responsible for an average 64% of the total savings by 2050 (with aircraft technologies and operational improvements responsible for 31% and 5%, respectively). However, this impact is associated with high uncertainty and very dependent on both biofuel type and availability.     

Estimating transboundary economic damages from climate change and air pollution for subnational incentives for green on-road freight

Subnational incentives to adopt zero emission vehicles (ZEVs) are critical for reducing the external economic damages posed by transportation to air quality and the climate. Few studies estimate these damages for on-road freight, especially at scales relevant for subnational policies requiring cross-border cooperation. Here, we assess the damages to US receptors from emissions of air pollutants (PM_2.5, NO_x, SO₂, NH₃), and greenhouse gases (CO₂, CH₄, N₂O) from medium and heavy duty freight trucking, and the benefits of ZEV adoption by census division in the Province of Ontario. We develop an integrated modelling framework connecting a travel demand model, a mobile emissions simulator, and a regression based marginal damages model of air pollutants and climate change. We estimate $1.9 billion (2010 USD) in annual cross-border damages, or $0.16/VKT, resulting from scaled up atmospheric emissions from a ‘typical day’ of medium and heavy duty truck traffic volume for Ontario in 2012. This implies approximately $8000 per truck per year in damages, which could inform an economic incentive for emission reduction. The provincial goal of 5% ZEV adoption would reduce GHG emissions in 2012 by 800 ktCO₂e, yielding $89 Million (2010 USD) in cross-border benefits annually, with air quality co-benefits of $83/tCO₂e. This result varies between −19% and 22% based on sensitivity analysis for travel and emissions models, though economic damages are likely the largest uncertainty source. Such advances in subnational scale integrated modeling of the environmental impacts of freight can offer insights into the sustainable design of clean freight policy and programs.     

Energy policies for passenger motor vehicles

This paper assesses the costs and effectiveness of several energy policies for light-duty motor vehicles in the United States, using a version of the National Energy Modeling System. The policies addressed are higher fuel taxes, tighter vehicle efficiency standards, and financial subsidies and penalties for the purchase of high- and low-efficiency vehicles (feebates). I find that tightening fuel-efficiency standards beyond those currently mandated through 2016, or imposing feebates designed to accomplish similar changes, can achieve by 2030 reductions in energy use by all light-duty passenger vehicles of 7.1–8.4%. A stronger feebate policy has somewhat greater effects, but at a significantly higher unit cost. High fuel taxes, on the order of $2.00 per gallon (2007$), have somewhat greater effects, arguably more favorable cost-effectiveness ratios, and produce their effects much more quickly because they affect the usage rate of both new and used vehicles. Policy costs vary greatly with assumptions about the reason for the apparent myopia commonly observed in consumer demand for fuel efficiency, and with the inclusion or exclusion of ancillary costs of congestion, local air pollution, and accidents.     

An environmental-economic evaluation of hybrid electric vehicles: Toyota's Prius vs. its conventional internal combustion engine Corolla

We compare the second generation of the first commercial hybrid electric vehicle (HEV), the Toyota Prius, to the conventional internal combustion engine (ICE) Toyota Corolla. The more complicated and expensive Prius has lower pollutant and carbon dioxide emissions and better fuel economy than the Corolla. In a world of limited resources and many petroleum users and emissions sources, the policy question is whether the best use of resources is to build hybrids, to improve the fuel economy and environmental emissions of other mobile sources, or to devote the resources to other environmental projects. We find that the Prius is not cost-effective in improving fuel economy or lowering emissions. For the Prius to be attractive to US consumers, the price of gasoline would have to be more than three times greater than at present. To be attractive to regulators, the social value of abating tailpipe emissions would have to be 14 times greater than conventional values. Alternatively, the value of abating greenhouse gas emissions would have to be at least $217/t. There are many opportunities for abating pollutant and greenhouse gas emissions at lower cost. We conclude that hybrids will not have significant sales unless fuel prices rise several-fold or unless regulators mandate them.     

Comparison of “Advanced” biofuel cost estimates: Trends during rollout of low carbon fuel policies

Costs of producing “advanced” biofuels (those with the lowest GHG and land use impacts) have not decreased in recent years as envisioned by analysts. Despite aggressive policy incentives, no transition to a lower cost mature industry has occurred. Information about the cost dynamics and slow industry emergence is of major interest to policymakers and others seeking to understand the likely success – and cost – of incentive programs. This paper reviews literature on production cost at the plantgate – without considering taxes or delivery costs – for selected biofuel technology pathways using a levelized cost of fuel approach, applying common financing assumptions for capital amortization and converting all values to year 2016 dollars, and examines results in the current low carbon fuel policy context. The average production cost estimate for cellulosic ethanol was $4 per gallon-gasoline equivalent (gge). For drop-in fuels, the pyrolysis-biocrude-hydro treatment pathway had the lowest average production cost estimate at about $3.25/gge. Biomass to liquid (BTL) production cost estimates averaged $3.80/gge, while hydrotreated esters and fatty acids (HEFA) – the sole fuel studied gaining commercial traction – averaged about $3.70/gge. Estimate ranges did not allow any definitive rank ordering of the fuels by production cost. Production cost estimates are higher in later than in earlier publications for non-HEFA fuels due primarily to higher costs for feedstock and capital expenditure components. This may reflect learning from early but largely unsuccessful commercialization efforts that yielded more realistic (and higher cost) information and detail on feedstock provision and conversion processes.     

Much Ado about Nothing? - An analysis of economic impacts and ecologic effects of the EU-emission trading scheme in the aviation industry

From 2012 on, all CO₂ emissions from flights departing from or arriving at airports within the European Union have to be offset. We analyze the economic and ecological impacts that are caused by an inclusion of the aviation industry into the proposed emissions trading scheme (ETS). Building on the now fixed system design we employ a simulation model to estimate the impacts of the scheme. Our results indicate that financial impacts are highly dependant on external settings, such as allowance prices and demand growth. We show that the financial burden on the aviation industry will be rather modest in the first years after the introduction of the system and therefore induce only low competition distortions. Likewise, emission reductions within air transportation will be comparably low. While aviation will induce a decline of emissions in other sectors, significant absolute reductions within air transportation can only be reached by a more restrictive system design.     

An aircraft performance model implementation for the estimation of global and regional commercial aviation fuel burn and emissions

Estimates of global aviation fuel burn and emissions are currently nearly 10 years out of date. Here, the development of the Aircraft Performance Model Implementation (APMI) software which is used to update global commercial aviation fuel burn and emissions estimates is described. The results from APMI are compared with published estimates obtained using the US Federal Aviation Administration’s System for Assessing Aviation’s Global Emissions (SAGE) for the year 2006. The number of global departures modelled with the APMI software is 8% lower compared with SAGE and reflects the difference between their commercial air traffic statistics data sources. The mission fuel burn, CO₂ and H₂O estimates from APMI are approximately 20% lower than those predicted by SAGE for 2006 while the estimate for the total global aircraft SO_x emissions is approximately 40% lower. The estimates for the emissions of CO, HC and NO_x are 10%, 140% and 30% higher than those predicted by SAGE respectively. The reasons for these differences are discussed in detail.     

Imperfect reversibility of air transport demand: Effects of air fare,fuel prices and price transmission

There are recent evidence that air transport demand may not have a perfectly reversible relationship with income and jet fuel prices, as is assumed in most demand models. However, it is not known if the imperfectly reversible effects of jet fuel price are a result of asymmetries in the supply side, i.e., asymmetries in cost pass through from fuel prices to air fare, or of demand side behavioral asymmetries whereby people value gains and losses differently. This paper uses US time series data and decomposes air fare and fuel price into three component series to develop an econometric model of air transport demand that is capable of capturing the potential imperfectly reversible relationships and test for the presence or absence of reversibility. We find that air transport demand shows asymmetry with respect to air fare, indicating potential imperfect reversibility in consumer behavior. We also find evidence of asymmetry and hysteresis in cost pass-through from jet fuel prices to air fare, showing rapid increases in airfare when fuel prices increases but a slower response in the opposite direction.     

Evolution of the household vehicle fleet: Anticipating fleet composition, PHEV adoption and GHG emissions in Austin, Texas

In today’s world of volatile fuel prices and climate concerns, there is little study on the relationship between vehicle ownership patterns and attitudes toward vehicle cost (including fuel prices and feebates) and vehicle technologies. This work provides new data on ownership decisions and owner preferences under various scenarios, coupled with calibrated models to microsimulate Austin’s personal-fleet evolution.Opinion survey results suggest that most Austinites (63%, population-corrected share) support a feebate policy to favor more fuel efficient vehicles. Top purchase criteria are price, type/class, and fuel economy. Most (56%) respondents also indicated that they would consider purchasing a Plug-in Hybrid Electric Vehicle (PHEV) if it were to cost $6000 more than its conventional, gasoline-powered counterpart. And many respond strongly to signals on the external (health and climate) costs of a vehicle’s emissions, more strongly than they respond to information on fuel cost savings.Twenty five-year simulations of Austin’s household vehicle fleet suggest that, under all scenarios modeled, Austin’s vehicle usage levels (measured in total vehicle miles traveled or VMT) are predicted to increase overall, along with average vehicle ownership levels (both per household and per capita). Under a feebate, HEVs, PHEVs and Smart Cars are estimated to represent 25% of the fleet’s VMT by simulation year 25; this scenario is predicted to raise total regional VMT slightly (just 2.32%, by simulation year 25), relative to the trend scenario, while reducing CO₂ emissions only slightly (by 5.62%, relative to trend). Doubling the trend-case gas price to $5/gallon is simulated to reduce the year-25 vehicle use levels by 24% and CO₂ emissions by 30% (relative to trend).Two- and three-vehicle households are simulated to be the highest adopters of HEVs and PHEVs across all scenarios. The combined share of vans, pickup trucks, sport utility vehicles (SUVs), and cross-over utility vehicles (CUVs) is lowest under the feebate scenario, at 35% (versus 47% in Austin’s current household fleet). Feebate-policy receipts are forecasted to exceed rebates in each simulation year.In the longer term, gas price dynamics, tax incentives, feebates and purchase prices along with new technologies, government-industry partnerships, and more accurate information on range and recharging times (which increase customer confidence in EV technologies) should have added effects on energy dependence and greenhouse gas emissions.     

Truck versus pipeline transportation cost analysis of wastewater sludge

Domestic and industrial sludge generated at wastewater treatment facilities is considered a potential biomass source for producing biodiesel. However, transportation of large amounts of sludge from wastewater treatment facilities to a biorefinery is expensive. The objective of this paper is to identify the proper transportation mode to use as a function of the volume shipped and transportation distances. Currently, sludge is mainly shipped by truck and pipeline. We estimated that the fixed and variable cost components of pipeline transportation for a volume such as 480 m³/day and a distance of 100 miles are $0.116/m³ and $0.089/m³/mile, respectively. We estimated the biomass (sludge) transportation cost per gallon of biodiesel, and observed the changes in these costs as a function of distance traveled and volume shipped. The outcomes of this study have the potential to help biofuel plants make better biomass transportation decisions, and consequently reduce the price of biodiesel significantly.     

Economic factors affecting the registration of lower CO2 emitting aircraft in Europe

We examine the various forces influencing the development and uptake of environmentally beneficial technical changes, focusing on airline technology. Within this context, we consider not only the nature of competition within the final market in which aircraft, an intermediate product, are sold, but also that of the product market itself, the commercial airline industry. The reasons for the gradual reduction in CO₂ per seat per aircraft movement in aircraft design are examined in terms of the real costs of aviation fuel, changes in the nature of the supply industry, the movement towards carbon cap-trade policies, and endogenous technical progress in the technology of the industry. The latter being taken as an empirical proxy for the role market forms play in influencing the fuel efficiency of the types of aircraft used. The results support the existence of these latter forces on the demand for aircraft types, allowing for other influences that affect aircraft technology.     

The potential of turboprops for reducing aviation fuel consumption

To assist in aviation systems planning in the context of fuel price uncertainty and environmental regulation, we take a total logistics cost approach and evaluate three representative aircraft (narrow body, regional jet, and turboprop) for operating and passenger preference costs over a range of fuel prices. Homogenous fleets of each vehicle category are compared for operating and passenger costs over a range of fuel prices and route distances and the minimum cost fleet mix is determined. In general, as fuel prices increase, the turboprop offers a lower operating cost per seat over a wider range of distances when compared with both jet aircraft models. The inclusion of passenger costs along with operating costs decreases the number of fuel price and distance pairs where the turboprop exhibits the lower cost. This analysis shows that the aircraft that exhibits the lowest cost is highly sensitive to fuel prices and passenger costs and points to the important balance between saving fuel and serving passengers.