Tuesday, January 17, 2012

Addicted To Expensive, Dirtier Gasoline When Cheaper Alternatives Exist

President Bush said famously that America is addicted to oil. But why are we?

Is our addiction rooted in oil costing less than alternatives? Is it mainly fueling infrastructure advantages for oil or the scarcity of vehicles able to run on something other than oil products? The oil addiction is so strong that we use it when cheaper alternatives exist.

Both electricity and compressed natural gas are much cheaper transportation fuels. Compressed natural gas averaged nationally $2.09 per gallon equivalent in the most recent Clean Cities Alternative Fuel Price Report. It ranged from a low of $1.48 in the Rocky Mountain region to a high of $2.46 in New England. On average, CNG cost $1.37 less than gasoline, but our addiction is so powerful that we keep fueling cars with the expensive, dirtier oil option.

Electricity costs about 2 to 4 cents per mile to power a vehicle, while gasoline costs 10 to 20 cents per mile.

How do the the price of biofuels compare? Ethanol averaged $3.19 per gallon in the latest Clean Cities price survey or 27 cents less than gasoline, while biodiesel averaged $4.18 or 37 cents more than petroleum diesel. Ethanol, however, on an energy equivalent basis was $4.51 per gallon or $1.05 more than gasoline.

Price is not the root cause of our addiction to oil, since both natural gas and electricity are much cheaper. Plainly, ending our addiction to more expensive, dirtier oil products will require an intervention, policies that accelerate the deployment of alternative fueling infrastructure and vehicles.


  1. wow - I had never seen these numbers before. I assume that the infrastructure costs associated with switching to primarily electric vehicles are quite high - but what is the holdup with natural gas?

  2. Fueling infrastructure and natural gas vehicles are both scarce. The US has just 1000 natural gas fueling stations and just half of them are open to the public. There is a massive market failure. The government--state and federal--must intervene to accelerate deployment. The US House, however, has stalled the Pickens plan. Conservatives and the Tea Party have attacked,the bill.

    1. It still appears to be happening, largely based on economics even without legislation. Don't know if you had seen this release: http://www.cleanenergyfuels.com/pdf/CE-OS.ANGH.011812.pdf

  3. I had seen it and like it. A couple points. It is just 150 stations by 213. That rate of deployment in our big nation is glacial and must make the Iranians laugh. The stations will be receiving important tax credits. As much as I like this deployment and congratulate those involved, the fact that this deployment is by far the biggest in the country makes the point how much is not getting done and how slow and small progress is.