How the U.S. Transportation System Can Save $1 Trillion, 2 Billion Barrels of Oil, and 1 Gigaton of Carbon Emissions Annually
By Jonathan Walker, Greg Ruck & Jerry Weiland
Rocky Mountain Institute
In the United States each year, our cars alone cost us well over $1 trillion, burn about 2 billion barrels of oil, and emit about 1.5 gigatons of carbon dioxide—one quarter of all U.S. emissions.
The indirect societal cost of these vehicles, including pollution, lost productivity (sitting in traffic), land use for roads and parking lots, road construction and maintenance, and injuries and fatalities cost us another $2 trillion per year, bringing the annual total to a staggering $3 trillion.
A big part of the problem is our cars and how we use them. Today’s vehicles are overdesigned, underutilized, underloaded, inefficient, polluting, and—thanks to the drivers behind the wheel—dangerous.
The average personal vehicle sits idle (i.e., parked) for 95 percent of its life. When we do drive our mostly parked cars, we tend to drive alone (more than 75 percent of American commuters are solo drivers) even though our vehicles are designed for four, five, or more occupants (empty third-row seat, anyone?). This leads to so much traffic that we spend 38 extra hours per year sitting in a purgatory of our own making.
In addition, tens of thousands of Americans are killed and hundreds of thousands are injured in car accidents each year. And finally, gasoline engines burn relatively expensive fuel inefficiently, as only ~20 percent of potential energy is converted into useful power for a standard internal combustion engine vehicle.
Thus the average American car owner spends an estimated $0.59 per mile to operate a personal vehicle, which adds up to a yearly cost of about $15,000 per household. Year after year, personal transportation is the second-highest expense for the typical American family, behind only housing and greater than food and leisure combined.
Public transportation systems are also underutilized in many U.S. markets. This often results in taxpayer subsidy, a crucial leg of support to combat transportation inequality since such public transportation often offers the only inexpensive option for those who cannot afford cars.
Reimagining the U.S. Transportation System
But there is a better way. A paradigm shift in our transportation system can drop per mile costs from $0.59 to $0.15, and when combined with public transit unlocks annual savings of $1 trillion. Or, if you’re business minded, you might see that substantial savings as value creation, for oil’s loss is another’s gain, in the form of new mobility service solutions that fill the gap between today’s fossil-fueled cars and tomorrow’s mobility paradigm. (For that matter, consumers too should be salivating. Someone who drives 12,000 miles per year could see his or her annual transportation costs slashed by more than $10,000 for two-car households.)
In addition to the monetary boon, the paradigm shift can reduce U.S. oil consumption by 50 percent (shaving off the full 2 billion barrels associated with our light-duty vehicles), and reduce carbon dioxide emissions by 1 gigaton per year. Cities, businesses, and entrepreneurs would be hard-pressed to find another arena with so much money on the table paired with so much potential societal benefit. And the public, you, and us stand to gain the most from this value creation opportunity.
Forget Cars—and Transportation—As You Know Them Today
The transportation paradigm of the potentially not-too-distant future (e.g., starting in earnest by 2020) will look a world apart from the landscape of today, in which the Ford F150 remains the best-selling consumer vehicle in the U.S. Instead, tomorrow’s transportation system will involve shared, electrified, autonomous, lightweight, serviced-based vehicles. This will of course implicate our beloved American obsession with automobiles, but is not entirely synonymous with cars. (more…)