As President Obama Orders Tough Tailpipe Regulations, Consumer Group Offers ‘A’ to ‘F’ Solutions for Cleaner and Cheaper Transportation
Americans Want Green Solutions But Worry About Costs; Handbook Identifies Wasted Billions, Best Paths
The vehicle/fuel grades in the handbook are:
A. Hybrid and plug-in hybrid vehicles, particularly if also capable of using biofuels.
B. Ethanol, particularly second-generation cellulosic ethanols.
B. Biodiesel, particularly if produced from a source other than soybeans.
C. Compressed natural gas. (Though CNG grade improves if used only for limited-range trucking and public transit).
D. Hydrogen. Conventional production methods energy-wasting, cost and fueling issues unresolved.
F. Fuel from coal. A polluting pork magnet for coal industry.
The handbook lists pros and cons for all of these choices, including cost and speed of development.
Congress and the White House must also get oil and fuel markets under control and ease the transition to greener private transportation, said Consumer Watchdog.
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The “Road” handbook also urges tougher oversight and greater transparency in energy trading markets and the fuel refining industry, to quell speculation and gaming of markets that result in a price roller-coaster. It suggests ways to encourage clean, renewable fuels and protect them from start-and-stop investment.
(Download the handbook [250 KB] at http://www.consumerwatchdog.org/resources/CleanerCheaper.pdf )
(See the full Executive Summary below)
“If government visibly gets oil markets and oil companies under regulatory control, if transition costs are fairly and transparently shared, and if the environmental benefits are clear, consumers will embrace the goal of a cleaner transportation system that ultimately will be cheaper than staying on the petroleum roller-coaster,” says the introduction to the handbook.
“Our grading system will be controversial but is well-defended,” said Dugan. “We defy anyone to show that the current practice of using taxpayer subsidies to produce motor fuels from coal is decent public policy, or even that automakers can produce an affordable, durable car that runs on cleanly produced hydrogen.”
The handbook lists pros and cons for all of these choices, including cost and speed of development.
The handbook urges that clean-vehicle purchase incentives, market regulations and tax credits from cap and trade proceeds be utilized to keep consumers on board for steady reductions in fossil fuel use.
“Congress and the White House are aiming to complete cap and trade legislation by the end of the year,” said Dugan. “These big initiatives have to consider effects on consumers or risk being seen as giveaways to industry while families pay the price. Congress can start by mustering the will to eliminate oil drilling subsidies and redirect the funds to green transportation.”
Showing a visible will to stand up to industry lobbying will give Americans who have no lobby of their own more trust in all that follows, said Consumer Watchdog.
The Road to Cleaner and Cheaper
EXECUTIVE SUMMARY
This handbook offers solutions for the most visible and pervasive sector of the current oil/environmental crisis: transportation by automobile. Americans travel more than 3.5 trillion vehicle miles per year (not even including occasional long-distance drives). They face often-staggering gasoline costs and emit millions of tons of pollutants. Our assessments and recommendations aim at reducing the use of oil as a personal transportation fuel while offering consumers alternatives that are ultimately both cleaner and cheaper.
Consumer Watchdog agrees with proponents of energy efficiency and conservation that both are fast, effective ways to reduce all types of fossil fuel dependence. These solutions are intertwined with vehicle use, and addressed here only in that context, for example in higher CAFE standards. Similarly, attention to mass transit is essential. But mass transit will not address the problems of millions of Americans who lack access to robust urban transit systems — meaning most Americans.
In the handbook, we highlight policies aimed at more effectively monitoring and regulating the oil industry and ensuring that the clean fuels and technologies of our automobile future don’t become the next energy oligopoly. We also grade the various alternative fuels in order to help policymakers and the public assess the choices for the future of automobile transportation.
1. GRADING THE OPTIONS:
In order to spend taxpayer money wisely and make smart choices about our transportation policy, policymakers must distinguish between policies, programs and technologies that have a broad public benefit and those for which the benefits are narrowly accrued by special interests. Consumer Watchdog has graded many of the technologies and fuels being debated in the planning for America’s energy future. The details discussed in the handbook are important and offer some caveats to these grades, but in summary:
Grade A- Hybrid, Plug-In Hybrid and All-Electric vehicles
Grade B- Ethanol and Biodiesel fueled vehicles
Grade C- Natural Gas fueled vehicles (higher grade for use in short-haul bus and truck fleets)
Grade D- Hydrogen fueled vehicles
Grade F- Coal-based transportation fuels
2. ENERGY MARKET OVERSIGHT AND REGULATION:
The neglect and demolition of reasonable government oversight of the oil industry has cost motorists billions of dollars and wreaked havoc on the economy and the environment. Energy markets and refinery operations in particular suffer from lack of modern regulation.
There are two crucial sources of unreasonably high pump prices, both tied to the deregulatory focus of national energy policy over the past several decades: rapacious speculation of commodity traders both in and outside of oil companies and market manipulations by oil refiners.
Energy commodity markets require a major regulatory overhaul to distinguish between pure financial speculation and transactions involving actual buyers and sellers. All trading should be far more transparent; financial speculators, including financial trading departments inside major oil companies, should also play by tougher rules. These include putting up more of the value of a trade in each transaction, limits on highly complex trading schemes that can be misused and overall limits on daily trades. In order to protect against a speculation-driven and distorted global commodity market for renewable fuels, regulation of biofuels must be established in concert with the expansion of the biofuels market.
Oil refining has become a tool for oil companies and other large players to manipulate fuel supply to keep prices up. The regional gasoline price spikes accompanying 2008′s Hurricane Ike were exaggerated by refiner cutbacks that had already left the nation with its lowest gasoline supply in years. The price spikes after Hurricane Katrina in 2005 were even more dramatic and lasting, needlessly so. The Department of Energy should have power to require an average 30-day national supply of gasoline on hand rather than the recent 20-22 day supply average. Refiners should be required to report their cost of oil and their wholesale prices for finished products, such as gasoline and diesel, to enable regulators to prevent price-gouging at the wholesale level. Refinery industry data should be publicly available down to the level of individual refineries, and ultimately refinery profits should be regulated along the model of public utilities.
3. RENEWABLE FUELS AND CLEAN VEHICLES:
Policy choices can transition our transportation system to more efficient, cleaner and cheaper fuels, without having to pick the exact formula. However, policy should be guided by realistic, consumer-oriented thinking that does not encourage wasteful projects such as transportation fuel from coal.
Hybrid vehicles and the coming generation of plug-in hybrid vehicles have few environmental drawbacks; they can calmly coexist with, and be improved by, biofuels. Electric hybrid-diesel vehicles, for instance, will be able to burn biodiesel without modification and achieve higher mileage than gasoline-electric hybrids. All types of dual-fuel hybrids should be encouraged.
Biofuels’ promise is limited today not by the availability of vehicles but by lack of fueling infrastructure and the drawbacks of using crops as feedstocks. Policy decisions should focus on second-generation biofuels and regulated development of fueling stations at existing gasoline stations.
Compressed natural gas and propane are cleaner than gasoline and are useful transitional fuels for urban bus and commercial fleets, such as short-haul trucks. Policy decisions should encourage these appropriate uses, but not at the cost of increased liquid natural gas imports or higher utility rates.
Hydrogen remains a chimera, because of vehicle cost and the energy cost of producing hydrogen as a fuel. While its promise of emission-free vehicles will continue to entice adherents, the lack of even remotely near-term viability makes it a lower priority approach. Coal-to-liquid fuel is no more than a pork magnet for the coal industry, more polluting than petroleum and a distraction from better alternatives.
3. WHO PAYS, WHO BENEFITS:
Switching to a transportation economy that uses far less petroleum does not come free, but the transition can be fair — softening costs to consumers through direct and indirect subsidy and requiring corporations and shareholders to bear part of the burden.
Congress must first eliminate billions of dollars worth of unjustifiable petroleum subsidies and tax excess petroleum profits, returning some of the proceeds to consumers and investing the rest in renewable energy.
Carbon tax, auction and trade, or cap and trade systems that will be negotiated in Congress will garner billions in federal revenue. While these alternatives are not specifically discussed in this handbook on transportation, offering substantial consumer credits and other direct incentives to offset the initial costs of reducing emissions will be important in reducing transportation use of fossil fuels.
(See full report at http://www.consumerwatchdog.org/resources/CleanerCheaper.pdf )
SOURCE Consumer Watchdog