January 2008

Diesel, hybrid yes; ethanol not yet

Cars and light trucks that use advanced diesel technology or hybrid technology can provide larger societal benefits than gasoline-powered automobiles, according to a RAND Corp. paper.

The research also found light trucks and cars continuously fueled by a mixture of 85% ethanol and 15% gasoline, known as E85, compare unfavorably with the other two alternatives, according to RAND, a non-profit research organization.

Advanced diesel and hybrid technologies show very well in this study, in terms of benefits to the individual and society. E85 does not provide the same benefits.

The research examines the benefits and costs of three alternatives to the gasoline-powered internal combustion engine for the 2010-2020 period: gasoline-electric hybrid technology (as found in the Toyota Prius or the Ford Escape SUV Hybrid), advanced diesel technology (such as the Mercedes-Benz E320 sedan), and dual-fuel vehicles that are powered continuously by E85.

Each alternative has the technological potential for significant market penetration in the near term, the research finds.

The paper ranks the four technologies using benefit-cost analysis. Using most reasonable assumptions, the results placed advanced diesel technology first, followed by hybrid technology, the gasoline engine, and E85 technology.

The consumer perspective accounted for technology cost, fuel savings, mobility, and performance. The societal perspective also included tailpipe pollutants, greenhouse gas emissions, and "energy security costs" for the fuels, the costs to society as a whole from greater dependence on expensive and unstable foreign oil supplies.

The results assume fuel prices of $2.50 per gallon for gasoline, $2.59 per gallon for diesel fuel, and $2.04 per gallon for E85 (including tax credit). The report also examines scenarios where fuel costs are much higher and much lower.

Findings from the consumer perspective:

  • For all three vehicle types, the advanced diesel offers the highest savings over the life of the vehicle among the options considered.
  • The hybrid option has smaller but still considerable savings for SUV applications ($1,066), moderate savings for pick-up applications ($505), but minimal savings over the life of the vehicle for car owners ($198).
  • The vehicles operating on E85 cost all three owners more over the vehicle life, with a greater net cost burden for larger vehicles and increased fuel consumption.

The hybrid and diesel vehicles are more fuel efficient than their gasoline-powered counterparts: 25 to 40% better for hybrid and 20 to 30% for diesel, depending on the vehicle.

"While it is assumed that the hybrid vehicle will save more fuel than the advanced diesel, the overall advantage goes to the diesel because of its lower technology costs and better performance such as increased torque," said John Graham, dean of the Pardee RAND Graduated School. "For E85, it is the cost of producing the fuel, not vehicular changes, that drives the negative results."

The paper, "The Benefits and Costs of New Fuels and Engines for Cars and Light Trucks," is at www.rand.org.

pg 27 Jan08 InTech