Energy efficient cars encourage driving

While I like the idea behind Better Place, in the New Yorker, David Owen sums up a concern I have had for some time:

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How do we persuade people to drive less—an environmental necessity—while also encouraging them to revive our staggering economy by buying new cars?

The popular answer—switch to hybrids—leaves the fundamental problem unaddressed. Increasing the fuel efficiency of a car is mathematically indistinguishable from lowering the price of its fuel; it’s just fiddling with the other side of the equation. If doubling the cost of gas gives drivers an environmentally valuable incentive to drive less—the recent oil-price spike pushed down consumption and vehicle miles travelled, stimulated investment in renewable energy, increased public transit ridership, and killed the Hummer—then doubling the efficiency of cars makes that incentive disappear. Getting more miles to the gallon is of no benefit to the environment if it leads to an increase in driving—and the response of drivers to decreases in the cost of driving is to drive more. Increases in fuel efficiency could be bad for the environment unless they’re accompanied by powerful disincentives that force drivers to find alternatives to hundred-mile commutes.

That is, fuel efficiency drives more use of fuel, not less. And that can well mean more emissions. If you are interested in the technicalities, the proof is here.

That said, I don’t agree with this implication in the article:

One beneficial consequence of the ongoing global economic crisis is that it has put a little time back on the carbon clock. Because the climate damage done by greenhouse gases is cumulative, the emissions decrease attributable to the recession has given the world a bit more room to devise a plan that might actually work.


5 thoughts on “Energy efficient cars encourage driving”

  1. The rebound effect from the decrease in the cost of fuel through fuel efficiency causes more than the increase in speed and driven miles. While this offset to fuel efficiency does occur, it may not use up all the extra disposable income created from the decrease in fuel costs. The extra available spendable income will be used for other purchases.

    The new consumables may use more or less carbon per dollar than automobiles, hybrid or not. There could actually be a net increase in carbon production. Furthermore, the new consumables may not have a readily available technological alternative product, a readily available alternative material input or process that will reduce carbon use.


  2. I’ve tried to explain this multiple times on LP.

    There’s other examples of similarly misguided policies.  I haven’t been able to locate the link, but I remember reading about a study that suggested Toyota Priuses in California typically had higher emissions than the cars they replaced.  Why?  Because hybrid drivers were permitted to travel in the transit lanes, thus making it more convenient to drive longer distances…


  3. This is well-known in the transport economics literature and the reason that most economists favour targeting the specific externality or distance-travelled rather than the proxy fuel.

    See e.g. Parry/Small AER 2005.  Basic conclusion – fuel tax hikes create incentives for more fuel efficiency not for driving less far.


  4. Getting more miles to the gallon is of no benefit to the environment if it leads to an increase in driving.

    I have to disagree with this.  Improved fuel efficiency decreases both cost-per-kilometre-driven and carbon-emitted-per-kilometre-driven.  Lower cost of fuel only decreases cost-per-kilometre-driven.

    If improved fuel efficiency drives cost-per-kilometre-driven back to where it was 10 years ago, then sure distance driven will rise back to the same level – but with a lower level of carbon emitted.

    Fuel isn’t a proxy at all – fuel used is directly proportional to carbon dioxide emitted, regardless of cost or efficiency.


  5. I can’t believe you fell for this one Joshua. This myth has been around for 2 years, following the “Boston Legal” show where it was argued that the Hummer is better than the Prius (see
    This in turn follows from the Hummer sponsored research that showed that the footprint of a Prius was greater PER KILOMETRE than the footprint of a Hummer, because Prius drivers DRIVE SO LITTLE. i.e. if you buy a car and leave it in your garage, the footprint per km is huge, since you’re dividing by zero…ok ok it’s infinity but you see the point.  But driving so little doesn’t sound like driving extra because the marginal cost of driving falls. For the record I’ve driven our Prius 38,000km in 3.5 years, which I bet is less than most drivers…and like most drivers of these cars I think about how to drive less, not more.


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