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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)
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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
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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.
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Policies
Transportation
Building
efficiency
Energy,Emissions, and
Expenditures—
and Jobs
Electricity
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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
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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
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Steven J. TaffDepartment of Applied EconomicsUniversity of Minnesota
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