California-Only Diesel Fuel To Cost More, Damage Economy?

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How do you solve a problem like diesel?

On the one hand, diesel cars are highly fuel-efficient on longer runs, and produce good power and torque figures in their modern-day guise. It's also vital for the transportation and logistics industry.

On the other, diesel cars are more capital and materials-intensive to make, require stricter control of emissions, and the fuel is typically more expensive. The latter could be set to get worse for Californians too, with a report suggesting that clean air directives from CARB will lead to job losses and drive up the cost of diesel fuel significantly.

According to CSPnet, special blends of California-only diesel could push prices up to $6.69 per gallon by 2020.

That would be inconvenient for the average diesel driver, with efficiency savings negated by the high pump prices. For the average 2012 Volkswagen Jetta TDI driver doing 15,000 miles per year, fuel bills would rise from $1,800 to $2,950 per year (figures from fueleconomy.gov)

However, it would be devastating for the trucking industry, which makes up 14 percent of California's economy.

The California Trucking Association (CTA) study predicts that by 2015-2020, the price increase attributed to California-only blends of diesel could result in 617,000 job losses in the containerized import sector, $68.5 billion in lost state domestic product, $21.7 billion in lost income and $5.3 billion in lost state and local taxes.

That's a lot of big numbers, and it does depend on a lot of factors, but ultimately it affects virtually everyone. Job losses are poor for the economy, and increases in the price of haulage are generally passed on to the consumer, in the form of more expensive products and services.

The CTA worries that those who aren't pushed out of business will simply move out of state, which would be equally damaging on California's economy.

Read into the study what you will--it is of course a study paid for by the CTA, for the benefit of the CTA's members--but there's certainly precedent. California already has its own blends of gasoline, for example.

The situation is perfect evidence of the difficulty policy-makers face in juggling economic and ecological needs--and illustrates that there is no silver bullet when it comes to greener transport.

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