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Transportation fuels and GHG emissions reduction
Steven J. Taff
Department of Applied Economics
University of Minnesota
Goal: Reduce GHG from transportation
• Drive less – tax on gas, miles, or GHG (miles)
• Better cars – CAFE (miles/gallon)
• Cleaner cars –
GreenCar
(GHG/mile)
• Cleaner fuel – RFS, LCFS (GHG/gallon)
2
Scoring and Standards
• None can be easily or directly measureed
• All need models and averaging and broad standards
3
Scoring
• What included (field, plant, car, iLUC)
• Where measured (local…world)
• What number (LCA or direct)
• What model (GREET, BESS, MnGREET?)
4
5
Indirect land use
change?•
CROP
SUPPLY
Increase
management
intensity
Increase
management
intensity
Change land
use
Change land
use
CROP
DEMAND
CROP
PRICE
population
weather Environment
change
prosperity policy
Scoring matters
6
Policy linkages
• Independent / Summable
• Complementary / Synergistic
• Conflicting / Redundant
7
MGA policy linkages model
• This is a “what‐if”
model, not a “what‐should‐ we‐do”
model
• Emphasis on how
policies might change activities
• Focus on links among policy actions, not on implication of stand‐alone actions
8
How policies influence outcomes
policy
parameters
DECISIONS
economy
outcomes
9
• People/Firms do the best they can with what they’ve got
• People/Firms choose lowest‐cost activity that is financially, legally, and technically feasible.
• Government sets the stage so that people/firms, in doing what’s best for themselves, do what’s
best for Society.
10
Policies
Transportation
Building
efficiency
Energy,Emissions, and
Expenditures—
and Jobs
Electricity
11
GHG accounting
Transportation
Buildings
Total GHG
emissions
ElectricitySequestration
reduction
12
Life cycle accounting
Hauling
Farm/Wellfield
Total
Production
facility
13
Indirect landuse
change
Supplies and
manufacturing
Direct
(combustion)
Policies
• Convince people to do something good
• Require people to do something good
• Pay people to do something good
• Make people pay to do something bad
14
Today: When Policies Collide
• Stricter CAFE standard
• GHG tax
15
CAFE Standard
CAFE
standard
(MPG)
Car
choice
Fuel use
(BTU)
fuel use
by car
(MPG)
GHG
from
vehicles
Annual
average fuel
cost per car
Other Vehicle
Costs
16
Cost to meet CAFE
($/Vehicle)
GHG tax
17
GHG Tax($/ton GHG)
Demand
for energy
(BTU)
Energy
portfolio
(BTU)
Total cost
($/BTU)
GHG
emissions
Carbon
intensity
(GHG/BTU)
Energy
intensity
(BTU/ton)
Technical
costs
($/BTU)
• Let’s go to the MGA model
18
Steven J. TaffDepartment of Applied EconomicsUniversity of Minnesota
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