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Pres. Obama’s Truck Efficiency is a W6+ solution: Win-Win-Win-Win-Win-Win+

February 18th, 2014 · No Comments

When it comes to climate mitigation opportunities, there is a simple reality:

Benefits outweigh costs …  enormously.

And, when it comes to climate mitigation and adaptation investments, we should be striving to achieve multiple wins from the same action wherever and whenever possible.

When looking at President Obama’s announcement, this morning, of new truck energy efficiency standards, it is clear that the measure meets the criteria of multiple wins.  The fact sheet (see after the fold) title clearly points to this:

Opportunity For All: Improving the Fuel Efficiency of American Trucks – Bolstering Energy Security, Cutting Carbon Pollution, Saving Money and Supporting Manufacturing Innovation

And, President Obama emphasized that this was a ‘win-win-win’ opportunity in his speech this morning in Maryland.

improving gas mileage for these trucks are going to drive down our oil imports even further.  That reduces carbon pollution even more, cuts down on businesses’ fuel costs, which should pay off in lower prices for consumers.  So it’s not just a win-win, it’s a win-win-win.  You’ve got three wins.

Looking at the fact sheet, there is a quadruple win space laid out:

  • Energy efficient vehicles lower the nation’s vulnerability to unstable global oil markets ;
  • Reduced fuel use, by definition, will contributing to lowering greenhouse gas emissions (compared to a business-as-usual case);
  • The upfront investment in more efficient vehicles will be more than compensated for in reduced fuel costs; and,
  • The drive for more efficient trucks, as is happening with automobiles, will spur innovation and increase American competitiveness.

This sounds tremendous … however … as is the case far too often, the proponents of action are yet again understating the full value of action.

This quadruple win actually significantly understates the full value streams as this move is actually a W6: a Win to the Sixth Power climate mitigation action.

As we strive to stop digging the holes deeper and climb our way out, we can seek to deal with these challenges in a stove-piped manner or address them with W6 solutions that have wins across multiple arenas:

  • Support energy independence
  • Create and protect jobs
  • Foster economic activity (cost effectively)
  • Strengthen long-term economic prospects
  • Address negative environmental impacts (from local pollution to acidification of the oceans)
  • Help mitigate climate change

As some are wont to say, crises create opportunities. One good piece of news, amid all the serious concerns that that list above should create for all of us, is the reality that many Win-Win-Win-Win-Win-Win (Win to the Sixth) opportunities lie before us, if we choose to seize them.

Let’s look at just a few additional value streams from the move for more fuel-efficient vehicles:

  • Improved health and reduced health care costs:
    • Diesel fumes are directly linked to numerous health problems from irritated eyes, to asthma, to cancer, to …
      • “Health studies show that exposure to diesel exhaust primarily affects the respiratory system and worsens asthma, allergies, bronchitis, and lung function. There is some evidence that diesel exhaust exposure can increase the risk of heart problems, premature death, and lung cancer.”
      • “About 70 percent of the cancer risk that the average Californian faces from breathing toxic air pollutants stems from diesel exhaust particles”.  One California study found that “diesel-particle levels measured in California’s air in 2000 could cause 540 “excess” cancers (beyond what would occur if there were no diesel particles in the air) in a population of 1 million people over a 70-year lifetime.”
    • The National Academy of Sciences estimated in the range of $0.16 per gallon of liquid fuel burnt in health care costs (which includes, by the way, gasoline which has lower health care implications).
      • The White House is estimating 530 million barrels of total fuel savings. Working with the NAS figure, $0.16 per gallon, this translates to $6.72 per barrel or roughly $3.6 billion in health care benefits.
  • Job creation
    • The improved fuel efficiency is an investment — an investment in ‘capital’ value.  That additional upfront investment translates into work in design facilities to get to the improved vehicles and in factory jobs to build better trucks.
  • Reduced fuel prices
    • Very basic economic principle: the law of supply and demand.  Reduced demand leads to lower prices.  Lowering US oil demand by 1 million barrels per day will, by definition, foster lower prices than what might have been the case with greater demand. If this is $2.50 per barrel and total US oil use were  15 million barrels per day, then this would have roughly $10 billion in reduced crude oil costs.
  • Economic strength
    • Even amid booming U.S. oil production, there is a simple reality: the United States imports oil.  Reduced oil demand translates directly to an improved balance-of-payments as every barrel of oil saved is, nowadays, roughly $100 less of import costs.
  • Improved trucking efficiency
    • Simply put, keeping all other factors the same, a more energy efficient system will have other efficiency benefits that build on the fuel efficiency. For truckers, this will mean greater flexibility as to when and where to refuel as they will not have to refuel as often.
  • And …

In his speech today, President Obama highlighted that this is a “win-win-win” opportunity.  In fact, the President and the White House press release left out many wins from the discussion.

Truck Fuel Savings Benefits

PS: As an aside, far better would be to invest in Steel Interstates and to reduce the need for trucking. See, for example,

The White House

Office of the Press Secretary

For Immediate Release
February 18, 2014

FACT SHEET: Opportunity For All: Improving the Fuel Efficiency of American Trucks – Bolstering Energy Security, Cutting Carbon Pollution, Saving Money and Supporting Manufacturing Innovation

Year of Action: Making Progress Through Executive Action

In his State of the Union address, the President outlined a comprehensive agenda to make America a magnet for middle class jobs and business investment. The President highlighted the autoworker, who, implementing the Administration’s historic fuel economy standards, “fine-tuned some of the best, most fuel-efficient cars in the world, and did his part to help America wean itself off foreign oil.” And the President pledged, “in the coming months” to “build on that success by setting new standards for our trucks, so we can keep driving down oil imports and what we pay at the pump.” The President also called on Congress to do its part “by putting people to work building fueling stations that shift more cars and trucks from foreign oil to American natural gas.” Today, the President laid out additional details for his plan to improve the fuel efficiency of American trucks – bolstering energy security, cutting carbon pollution, and spurring manufacturing innovation.

  • Directing the Environmental Protection Agency (EPA) and the Department of Transportation (DOT) to Set the Next Round of Fuel Efficiency Standards for Medium- and Heavy-Duty Vehicles. Today, the President is directing the EPA and the DOT’s National Highway Traffic Safety Administration (NHTSA) to develop and issue the next phase of medium- and heavy-duty vehicle fuel efficiency and greenhouse gas standards by March 2016. Under this timeline, the agencies are expected to issue a Notice of Proposed Rulemaking (NPRM) by March 2015. This second round of fuel efficiency standards will build on the first-ever standards for medium- and heavy-duty vehicles (model years 2014 through 2018), which were proposed and finalized by this Administration and will save vehicle owners and operators an estimated $50 billion in fuel costs and save a projected 530 million barrels of oil.
  • Partnering with Private-Sector Leaders to Deploy Advanced Vehicles. In addition, the President highlighted the success of the National Clean Fleets Partnership that he launched to speed the deployment of clean, energy-efficient vehicles and the infrastructure to support their use. This public- private partnership helps the nation’s largest fleet operators reduce diesel and gasoline use in their fleets by incorporating alternative fuels, electric vehicles and fuel-saving measures. To date, 23 major national companies, such as ARAMARK, Coca-Cola, Staples, UPS, AT&T, Enterprise Holdings, and Waste Management have joined the National Clean Fleets Partnership. Collectively, the National Clean Fleets Partners operate more than one million commercial vehicles nationwide. The President has directed his Department of Energy to provide each company that wants to partner with specialized resources, technical expertise and support in developing a comprehensive strategy to reduce fuel use and achieve greater efficiency and cost savings.
  • Expanding Fuel Choices for American Drivers. In addition to taking executive action to make America more energy independent and cut carbon pollution, the President is also renewing his call for Congress to end subsidies to oil and gas companies and create an Energy Security Trust Fund to fund research and development for advanced vehicle technologies. And he is proposing to support investment in advanced vehicles and infrastructure through a new tax credit and an extension of tax credits to support cellulosic biofuels.

Further Detail on how the President will Continue to Work with Congress to Improve the Fuel Economy of American Trucks – Bolstering Energy Security, Cutting Carbon Pollution, and Spurring Manufacturing Innovation

  • Directing the Environmental Protection Agency (EPA) and the Department of Transportation (DOT) to Set the Next Round of Fuel Efficiency Standards for Medium- and Heavy-Duty Vehicles. Today, the President is directing the EPA and the DOT’s National Highway Traffic Safety Administration (NHTSA) to develop and issue the next phase of medium- and heavy-duty vehicle fuel efficiency and greenhouse gas (GHG) standards by March 2016. Under this timeline, the agencies are expected to issue a Notice of Proposed Rulemaking (NPRM) by March 2015. This second round of fuel efficiency standards will build on the first-ever standards for medium- and heavy-duty vehicles (model years 2014 through 2018), and will reach well into the next decade, just like the President’s successful national car standards.Increasing the efficiency of medium-and heavy-duty vehicles (below referred to simply as heavy-duty vehicles) is a key component of the President’s Climate Action Plan to reduce carbon emissions. Heavy-duty vehicles represent a major opportunity to cut transportation oil use and carbon pollution. In 2010, heavy-duty vehicles represented just four percent of registered vehicles on the road in the United States, but they accounted for approximately 25 percent of on-road fuel use and greenhouse gas emissions in the transportation sector. They are currently the second-largest source of greenhouse gas emissions within the transportation sector (passenger cars and light trucks are the largest source). The first round of standards for medium- and heavy-duty vehicles, finalized in September 2011, is projected to save 530 million barrels of oil and reduce GHG emissions by approximately 270 million metric tons, saving vehicle owners and operators an estimated $50 billion in fuel costs over the lifetimes of the vehicles covered. For example, an operator of a new 2018 semi truck could pay for the technology upgrades in under a year and realize a net savings of $73,000 through reduced fuel costs over the truck’s useful life.
    • Partnering with Manufacturers, Labor, States, NGOs, and other Stakeholders. To develop standards that provide long-term certainty and promote innovation, EPA and NHTSA will work closely with stakeholders, both large and small, to explore further opportunities for fuel consumption and emissions reductions beyond the model year 2018 timeframe. EPA and NHTSA will also work closely with the California Air Resources Board (CARB) with the goal of ensuring that the next phase of standards allow manufacturers to continue to build a single national fleet.
    • Supporting Adoption of New Fuel Efficient Technologies. The second round of fuel efficiency standards will spur manufacturing innovation and lead to the adoption of new fuel-efficient technologies on trucks and semi-trailers. In developing the standards, EPA and NHTSA will assess advanced technologies that may not currently be in production, and will consider, for example:
      • Engine and powertrain efficiency improvements
      • Aerodynamics
      • Weight reduction
      • Improved tire rolling resistance
      • Hybridization
      • Automatic engine shutdown
      • Accessory improvements (water pumps, fans, auxiliary power units, air conditioning, etc.).
  • Partnering with Private-Sector Leaders to Deploy Advanced Vehicles. In addition, the President highlighted the success of the National Clean Fleets Partnership that he launched to speed the deployment of clean, energy-efficient vehicles and the infrastructure to support their use. This public- private partnership helps the nation’s largest fleet operators reduce diesel and gasoline use in their fleets by incorporating alternative fuels, electric vehicles and fuel-saving measures. To date, 23 major national companies, such as ARAMARK, Coca-Cola, Staples, UPS, AT&T, Enterprise Holdings, and Waste Management have joined the National Clean Fleets Partnership. Collectively, the National Clean Fleets Partners operate more than one million commercial vehicles nationwide.The President has directed his Department of Energy, working with EPA’s complementary SmartWay Transport Partnership, to provide each company that wants to partner with specialized resources, technical expertise and support in developing a comprehensive strategy to reduce fuel use and achieve greater efficiency and cost savings. Working with the Administration, the private sector partners that have joined the National Clean Fleets Partnership and the SmartWay Transport Partnership are seeing why deploying advanced vehicles is a win-win for them; for example:
    • Last year, AT&T achieved a significant milestone with the delivery of its 7,500th alternative fuel vehicle (AFV). AT&T has committed to deploying around 15,000 AFVs over a 10-year period through 2018. AT&T’s AFV fleet includes compressed natural gas, hybrid electric, all-electric, and extended-range electric vehicles. AT&T’s deployment of alternative fuel vehicles enabled the company to avoid the purchase of 7.7 million gallons of gasoline from the beginning of the program through the end of 2012. And over the 10-year deployment period these AFV’s will save 49 million gallons of gasoline and reduce carbon emissions by 211,000 metric tons.
    • Enterprise kicked off a program to make plug-in electric and hybrid cars available to rental customers in major US markets. Four cities have been announced to date (Orlando, San Francisco, Seattle, and Portland). In addition, more than 80 % of their 500 airport shuttle buses now operate on biodiesel or compressed natural gas. Enterprise’s fleet is not only the world’s largest, it’s also one of the most fuel efficient. Approximately 57.3 percent of their vehicles average a highway fuel efficiency rating of at least 28 mpg, and 28 percent of their vehicles average 32 mpg or better.
    • Con-Way, a 2013 SmartWay Excellence Award winner, has equipped 100% of its tractors with SmartWay-certified fuel-savings and emissions-reduction technologies, and nearly half its trailers with fuel-saving aerodynamic features. The company’s tractors also have automatic idle shutdown, and the company has equipped its tractors and trailers with low- rolling resistance tires to increase miles per gallon and lower carbon emissions.
  • Partnering with Manufacturers to Support Innovation for the Next Generation of Trucks. Class 8 combination trucks – commonly known as 18-wheelers – serve as the backbone of our domestic freight transportation – hauling about 70 percent of all freight tonnage and over 70 percent of the value of all goods shipped. The Administration’s SuperTruck program, launched in 2010 and funded by the Recovery Act and subsequent annual appropriations, is focused on demonstrating that, by 2015, the freight hauling efficiency of heavy-duty Class 8 trucks can be improved by 50 percent.Through the program, the Department of Energy has partnered with four major engine and truck manufacturers – including Cummins, Volvo, Navistar and Daimler Truck North America – to increase engine efficiency and overall fuel economy from about 6.5 miles per gallon to about 9.75 miles per gallon. Class 8 vehicles have a total weight (including freight) of 33,000-80,000 lbs. and sometimes more; so every mile per gallon gained in fuel economy is worth thousands of dollars in fuel cost savings per truck per year. Since 2010, SuperTruck partners Cummins and PACCAR’s Peterbilt Motors Company have demonstrated a 20 percent increase in engine efficiency and a 70 percent increase in freight efficiency, reaching over 10 miles per gallon under real world driving conditions on a Class 8 tractor-trailer. Cummins is now working toward developing technologies to achieve even higher engine efficiency. The other three partner teams are also on their way to achieving a 50 percent fuel economy increase—leveraging a range of aerodynamics and engine efficiency technologies, including waste heat recovery technologies. Daimler Trucks of North America has demonstrated 50% engine efficiency and halfway through their project, Volvo has already demonstrated 48% engine efficiency.

Further Detail on how the President will Continue to Work with Congress to Improve the Fuel Economy of American Trucks – Bolstering Energy Security, Cutting Carbon Pollution, and Spurring Manufacturing Innovation

  • Expanding Fuel Choices for American Drivers. While the United States will continue to rely on responsibly produced oil and natural gas, President Obama is committed to a long-term policy that allows us to transition to cleaner energy sources.
    • Establishing an Energy Security Trust Fund to Fund R&D for Advanced Vehicle Technologies. In addition to urging Congress to repeal the $4 billion in subsidies that taxpayers provide the oil and gas industry each year, the President has called on Congress to establish an Energy Security Trust and enact reforms to promote diligent oil and gas development on federal lands. The Energy Security Trust proposal has broad bipartisan support, including retired admirals, generals and leading CEOs, and focuses on shifting our cars and trucks off oil. This $2 billion investment in a range of cost-effective technologies – like advanced vehicles that run on electricity, homegrown biofuels, hydrogen, and domestically produced natural gas – will be drawn from revenues generated from federal oil and gas development. Establishing a dedicated source of funding will allow the Energy Department to maintain targeted and sustained investments that are catalytic and directly advance U.S. energy security.
    • Supporting Investment in Advanced Vehicles and Infrastructure through a New Tax Credit and an Extension of Tax Credits to Support Cellulosic Biofuels. The President is announcing $200 million in a new tax credit to catalyze investment in the necessary infrastructure to support deployment of advanced vehicles at critical mass. This proposal would be fuel neutral, allowing the private sector to determine if biofuels, electrification, natural gas, hydrogen, or other alternative fuels would be the best fit in different communities. In addition, the President is proposing to extend the cellulosic biofuel producer credit that expired on December 31, 2013. Cellulosic biofuels have the potential to reduce petroleum consumption and carbon pollution while boosting rural economic development. Extending the existing tax credit would accelerate development of this transformative transportation fuel.

Tags: Energy

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