So how do all the issues below regarding the quid pro quo for a bailout relate to Contracarbon?
If the CAFÉ standards were high enough, and the economics worked, the need for oil from other countries (except maybe Canada) would ultimately go away. The 2008 CAFÉ standard for combined light trucks and passenger cars was 22.5 miles per gallon, up from 17.5 mpg in 1982 (!). For passenger cars only, we have gone from 24 mpg in 1982 to 27.5 in 2008. We have said we are going to 35 mpg by 2020. The California rules would push that to 37. Of course Europe, Japan and China are at 44, 46 and 36 already with objectives in the 50’s in the time frames we are discussing below. If we instituted serious standards and supported the new car companies that already can get us to 100 mpg or better, we could get to 55 or 60 mpg for the whole fleet by 2030. And the cost per mile could be significantly less than it is today. I can take you through the calculations, but, trust me; at least half the 10 million barrels of oil we currently import every day could be eliminated. That would happen through a combination of conventional fuel efficiency and alternative power trains.
The sooner we get to higher mpg the sooner this will happen. The US auto fleet of about 240 million vehicles takes about 20 years to turn over at the historical rate of scrappage—about 4.5% of the car fleet goes to the scrap pile each year. Currently, that is about the level of new car sales. That level is logical. In this economic environment and with some belief that fuel economies may improve significantly in the next few years, why would anyone buy a car unless her current car fell apart or was just uneconomical to operate? That doesn’t mean the person scrapping the 20+ year-old car would buy a new one. But as he traded up, ultimately, at the end of the food chain, someone would buy a new car.
The modest improvement in efficiency from older to newer cars does, by itself, reduce emissions. If we could quickly get to higher CAFÉ levels and keep the new car purchases at the scrappage level for a few years (and keep miles traveled flat), we could become significantly less oil dependent in 20 years and reduce CO2 emissions by close to 1 Gigaton per year. 20 years seems like a long time, and the goal of 60 miles per gallon for the fleet seems problematic—at least in the States. But, in the scheme of things, both objectives are reachable. However, they aren’t reachable unless we set them as objectives. In 40 years, if we can’t get to double those objectives, shame on us. The truth is, if we don’t develop the technology to do it, someone else will. That would be a big loss for the US economy. I take full responsibility for these calculations and conclusions, but the early work on this was done by Saurin Shah when he was at Sanford Bernstein and which he continued at Neuberger Berman. He has a chapter coming out in a book on transportation electrification very soon.
Trains and Planes, or more generically, public mass transportation becomes important as well. Reducing or stabilizing VMT (Vehicle Miles Traveled) by substituting mass transit can be a significant factor. Up until recently we were car-traveling about 3 trillion miles a year in the US. Currently, the average vehicle produces about 1.1 pounds of CO2 (or equivalent) per mile. (SUVs are at 1.6. A Prius is at .55.) In the last 12 months, for the first time in a long time, we dropped 30 billion miles. That’s 33 billion pounds or 16.5 million tons of CO2. I hope it doesn’t take a depression to keep those mileage numbers dropping. It does take a commitment to mass transit. More on that later.