Monday, October 13, 2008

Low-Hanging Fruit On Wheels

The MPG illusion has been in the news a lot recently. Basically, expressing fuel efficiency in MPG tends to mislead people about actual fuel savings. I think it also tends to mislead people with regard to the effectiveness of increasing vehicle efficiency as a peak oil mitigation strategy.

Last July, Neil King of the WSJ wrote an article about why it will be harder to cut back this time. We cut our oil use by 20% after the last oil crisis...but half of that was switching power plants from oil to coal or natural gas. There are very few oil-fired power plants left in the U.S. now, so that is not something we can repeat.

But what about cars? There are still big gains to be made there, surely.

Maybe not. The MPG illusion fools us because people think fuel consumption is decreased as efficiency improves. But that is not the case. Here's a concrete example:

In the '70s, my uncle traded in his Chevy Bel-Air (about 12 mpg) for a little Datsun (about 50 mpg). Assuming 1200 miles driven a month:

Chevy: 100 gallons
Datsun: 24 gallons
Gas saved: 76 gallons a month

So, if you have a Prius or an old Geo Metro today, assuming 50 mpg, you're using only 24 gallons to drive 1200 miles. You cannot actually get a 76 gallon savings via increased fuel efficiency, unless your car somehow creates gasoline while you drive.

If you double the MPG of the it 100 mpg. For 1200 miles, that's 12 gallons saved. Very small compared to, say, trading your Hummer (13 mpg) for a Prius (which would also be roughly 76 gallons saved).

This is why I don't expect Mooresian improvements in mileage. Assuming 1200 miles driven a month:

25 mpg 48 gal
50 mpg 24 gal 24 gal
100 mpg 12 gal 12 gal
200 mpg 6 gal 6 gal
400 mpg 3 gal 3 gal
800 mpg 1.5 gal 1.5 gal
1600 mpg 0.75 gal 0.75 gal

Each improvement is going to have a higher cost and lower benefit; eventually, it just won't be worth it any more. For me, the Prius is already past the point of diminishing returns. I considered it, but I don't drive that much, and it just wasn't worth the extra expense. I bought a Corolla.

Yes, trading in a Hummer for a Prius can make a big difference...but there really aren't that many Hummers on the road. In the early '70s, the average car got 13 mpg. For the past decade or so, the average new car in the US has gotten 21 mpg.

Again assuming 1200 miles driven a month:

13 mpg 92 gal
21 mpg 57 gal 35 gal
55 mpg 22 gal 35 gal

So to match the improvement we've made since the '70s, we would have to increase the fleet efficiency to 55 mpg. That sounds doable - the Prius is in the ballpark - but even Japan has not achieved it fleet-wide. They've been working on this fuel economy thing since the '70s. And their average fuel efficiency is about 30 mpg. Much better than our 21 mpg, certainly, but a far cry from 55 mpg. And any improvements over that would be even harder to achieve.

Tainter called this declining marginal returns. The low-hanging fruit is picked first. That is, the easy fixes with the largest benefits are done first. Further improvements will be more difficult and more expensive, until they are not worth doing at all.

The "MPG illusion" is low-hanging fruit on wheels.

No comments: