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Save Money, Cut Emissions, and Create Jobs: The Benefits of Half the Oil

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Let’s be real. You probably already know that our oil use causes problems. It’s dirty, hard to clean up, tied to large corporations that wield significant influence over our political system, and is the largest single source of CO2 emissions in the U.S. We also use a lot of it – almost 2 million barrels (roughly 78 million gallons) every single day. So, it should be no surprise that UCS is working on a realistic plan to cut our projected oil use in half – in only 20 years.

Benefiting from Half the Oil

Our Half the Oil plan is not about where we get our oil from but rather, is about how we can use less. By continuing to invest in the science behind vehicle efficiency and in innovative ways to power our vehicles, like renewable electricity and biofuels made from non-food sources, we can reach a future that looks bright. A Half the Oil future means cutting our country’s annual oil spending by $550 billion, creating more than 1 million jobs, and eliminating some 2 billion metric tons of global warming emissions each year – all by 2035.

Pretty cool right? We thought that the benefits of Half the Oil were so grand that we recently released a report called “Fueling a Better Future” that details the importance of reaching a Half the Oil future and the steps we’re already taking to get there. Head on over to the website to check it out but before clicking through, here are some top line factoids.

Half the Oil and You

Transportation is the second-largest expense (after housing) for most American households, costing more than food, clothing, and health care. Over the last several years the average U.S. household spent around 4 percent of its pretax income on gas. In fact, over the life of a car bought in 2011, an owner will spend more than $22,000 on gasoline. Reducing oil use through improving the fuel efficiency of our passenger vehicles, therefore, is one of the biggest and most immediate ways that we will benefit in a Half the Oil future.

Chart-Average-US-Spending-on-Gasoline_Full-Size

The recently strengthened Corporate Average Fuel Economy standards – for fuel efficiency and global warming emissions of light-duty vehicles – are already beginning to help consumers and will save the average driver of a new vehicle in 2025 around $8,000 over the vehicle’s lifetime compared with an average model year 2011 vehicle. As the science behind increasing efficiency of our vehicles continues to improve, automakers will be able to meet even higher fuel economy targets that will provide consumers even more savings.

Half the Oil and Our Communities

Most people don’t always think about the health impacts associated how goods are transported and stored, but for communities near ports, large markets, and other distribution hubs that create heavy truck traffic, the consequences can be dire. Scientific studies have linked diesel exhaust to increased rates of respiratory illness, asthma attacks, heart attacks, strokes, and even premature death. In 2012, the World Health Organization found that there is sufficient evidence that diesel exhaust causes cancer. Moving toward a Half the Oil future means that by reducing oil use, we will also reduce the harmful emissions and adverse health effects from transportation while still being able to get goods where they need to go.

From coast to coast, oil-savings solutions are already cleaning up our communities. For example, in 2010 the Pacific Northwest Pollution Prevention Resource Center, in partnership with a major trucking fleet in the region, received a federal grant to install more than 2,000 aerodynamic side-skirts on trailer trucks. In addition to saving 16 million gallons of diesel fuel over its lifetime, this project will also reduce emissions of particulate matter (PM) – a harmful type of pollution that can affect the heart and lungs – by nearly 25 tons. These PM reductions are estimated to provide public health benefits of between $7 million and $30 million in 2030.

Half the Oil and Our Country

Investing in the science and technology needed to reduce oil use will provide our country with a tremendous opportunity to create new jobs, reduce global warming emissions, and secure our wallets from oil price shocks.

Just through investing in efficiency in cars and trucks, for example, we can create as many as 1 million new U.S.-based jobs in the automotive-related industry. Jobs will also be created as consumer spending shifts from oil to other parts of the economy that demonstrate higher potential for job creation compared to the oil and gas industry.

 Chart--Job-Intensity-by-Economic-Sector_Full-Size

Reaching a Half the Oil future also means significantly reducing emissions from oil and other petroleum products — the largest source of U.S. global warming emissions today. By ramping up production of cellulosic biofuels made from non-food sources, for example, we can cut CO2 emissions by 164 million metric tons in 2035 – or as much as the annual CO2 emissions from the electricity used by more than 24 million of today’s homes. Overall, in a Half the Oil future, we will have cut emissions by more than 2 billion metric tons per year in 2035. That’s as much as the annual greenhouse gas emissions from burning 8.5 million railcars worth of coal.

Lastly, cutting our oil use through using alternative energy sources not associated with the global energy market means that we will have an insurance policy against oil price shocks. While electricity prices vary across the country, they are relatively stable and the average retail price of electricity rose less than three cents per kilowatt-hour from 2001 to 2011 while gas prices dramatically spiked over the same period (see graph below).

Electricity is also much cheaper as a transportation fuel compared to gasoline. The Department of Energy recently released this handy tool that allows you to compare how much it would cost to drive on gas vs. electricity in your area. It turns out that the average price for an “eGallon” is about $1.14 compared to the $3.65 average price of regular gasoline.

 Chart-Gasoline-vs-Electric-Fuel-Costs_Full-Size

Overall, the choice is clear. It’s time to commit to a Half the Oil future. Join the chorus of voices calling for this commitment and stay tuned for updates on how far we have traveled down the road to a Half the Oil future.

Posted in: Vehicles Tags: , , , , ,

About the author: Josh Goldman is a policy analyst and leads legislative and regulatory campaigns to help develop and advance policies that reduce U.S. oil use. See Josh's full bio.

Support from UCS members make work like this possible. Will you join us? Help UCS advance independent science for a healthy environment and a safer world.

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3 Responses

  1. TJ Orlowski says:

    Thanks for the reply Josh,
    You may have heard I can be somewhat of a stickler, so it should come as little surprise when I point out your answer to my first question re: ROI dealt with hybrids, not pure electrics like the Chevy Volt, Tesla X, Tesla S etc. Even after taking into account that literally someone else is paying $7,500 of the price-tag on an electric vehicle, these vehicles are still well outside the price-range for what an average consumer can afford. Even if a consumer was willing to make the $750+/month payment, the ROI would not be close to 3 years when stacking it up against a fossil-fuel vehicle with similar size, performance, and features/amenities.

    To me, this push to mandate the decrease in gas use of motor vehicles through legislation and bureaucratic fiat and not natural market forces is strikingly similar to the push for ethanol that happened around the turn of the century. At the beginning all the “research” showed that it would be great for the environment, be a boon for farmers, and would save people money. As it has turned out, ethanol has been a complete debacle, across the entire spectrum from environment, cost to consumers, and negative impact the world’s poor due to distorted food prices.

    Just a clarification to wrap up: when I say “be forced to buy a product I don’t want,” it’s slightly more nuanced than someone holding a gun to my head and telling me to strap in to a hybrid. What I mean is, if a new start-up auto-maker, or a specialized auto-maker (think: Hummer) want to focus on large, gas-guzzling SUV’s, and there are customers who are willing and able to buy their product, why should those companies be shut down, prevented from starting up in the first place, or be forced to change their business model to add additional offerings outside of their expertise and the wants of their customers? The government requirements for average fuel efficiency across a company’s entire fleet of vehicles, in effect, are already doing this. No one has ever been forced to buy a large gas guzzling SUV. The point is, if Hummer wants to sell me a large gas guzzling SUV, and I want to buy one, I can’t (unless Hummer wants to make a 50 MPG model to compensate for government requirements). Therefore, I am being forced to buy a product I don’t want. The product I do want isn’t available due to arbitrary market influence. And it is arbitrary.

  2. TJ Orlowski says:

    What is the time period for return on investment for an electric vehicle versus a comparable fossil-fuel vehicle? A lot of the discussion seems to be focused on the cost of gas versus the cost of driving the same distance using electricity. If a person is paying $10,000-$15,000 more (on the sticker) for an electric, the break-even point would be 7 years. (Assuming the Egallon number above is correct, and a 15,000 mile/year usage) If a car is financed, the break-even horizon is out even further. This also assumes the total cost of ownership (excluding fuel) is the same for either option. With real net-incomes on the decline, and a shrinking middle class, is this altruism worth forcing on people who may not be able to afford it (or may not keep their vehicles for long enough to realize real economic benefit)?

    Also, what analysis (if any) is being done on the effective safety of vehicles that achieve such drastically increased fuel efficiency? Improvements in engine and exhaust technology have made marginal improvements in MPG, but the lion’s share of fuel efficiency increases have been achieved by making smaller, lighter vehicles. Given that IHS standards have been changing rapidly, it’s difficult to accurately compare how well a “legacy” vehicle would fare in an accident versus how well a “half-the-oil” vehicle would fare in the same exact conditions. Common sense would indicate that a larger, heavier vehicle would resist damage better than a smaller, lighter one. But again, what analysis is being done on this?

    Lastly, given the Univ. of East Anglia realizations, we now know that there hasn’t actually been any global warming of any kind in the last twenty years. This is despite the rapid growth and expansion in the developing world (none of which have an EPA equivalent), which are expanding multitudes more quickly than the US and Europe did in the 20′s and 30′s. An intellectually honest person would admit it’s dangerous to stand behind the exhaust pipe of an internal-combustion engine vehicle for extended periods, but whether or not the aggregate use of such vehicles has resulted in global warming would need a complete re-evaluation before any determination can be made. In fact, in light of the East Anglia scandal, and in addition to increasingly more publicly information available information (see the article in The Economist from earlier this year), the correlation between CO2 emissions and its effect on macro-climate is growing increasing weaker (as is the argument for man-made global warming).

    Full disclosure: I have no political or corporate ties to this issue. I run a small manufacturing business (no fossil fuels used in production or fueling the building). I just have no interest in being forced to buy products I don’t want (read: not having the option to buy the product I do want), or forcing others to buy products they don’t want. If the economic and environmental argument being asserted is built on a house of cards, full implementation of these programs would only distort the economy even more than it already has been distorted, without adding any real value or quality to people’s lives.

    • Josh Goldman says:

      Hi Tj.

      Thanks for the comment. There’s a lot in there to tackle, but I’ll do my best to respond to questions that are within my expertise as a vehicles analyst.

      The time period for return on investing in an EV depends on what EV you buy, and what ICE (internal combustion engine) vehicle you use as a comparison. Given the ever expanding range of EVs and apples to oranges comparison between EVs and ICEs, we have focused on the difference in fueling costs and emissions between the 2 vehicles, instead of upfront costs. However, my team did examine the difference in payback between a standard Ford Fusion SE and a Ford Fusion SE Hybrid, which costs about $3,500 than the base model, but would save a consumer more than $9,000 in fueling costs. If you purchased the Fusion Hybrid in 2012, you would recoup the additional $3,500 cost for the hybrid tech by 2016. We recognize that EVs aren’t for everyone, and they are still, generally, sitting at a price point above some conventional vehicles. But, there are many other reasons to buy an EV other than saving money on fuel – which is absolutely a benefit that should not be ignored. Creating zero tailpipe emissions, not contributing to oil company coffers, and pushing innovation from American companies like Chevrolet are some of the many reasons why an EV could be a good choice.

      As far as vehicle safety is concerned, I would suggest you check out the National Highway Traffic Safety Administration for how the Administration is ensuring that safety will not be compromised as cars become lighter and more efficient. Note that there’s no one “half the oil” vehicle. Half the Oil is, in part, about giving consumers more choices in the showroom – from fuel efficient minivans, to 2-door EVs, and everything in between. I respect your wish not to be forced to buy products that you don’t want. I too don’t want to be forced to buy a gas guzzling SUV, for example. But pushing for fuel efficiency will save consumers money, create jobs, and reduce emissions – all benefits of a Half the Oil future.

      Lastly, for all things climate-related, I refer you to my extremely knowledgeable colleagues in the UCS Climate and Energy team.