Within Reach: California’s Road to 50 Percent Petroleum Use Reduction Explained in Four Easy Concepts

rp_Tim-OConnor-Nov-2014-214x300-214x300.jpgCutting gas and diesel use in California has been a focus of Sacramento policy makers for years. After all, fuel combustion chokes our state with exhaust, releases a massive amount of global warming pollution, and undermines our economic security. And, at nearly 20 billion gallons of total use per year costing drivers over $50 billion a year – with much of the money flowing directly out of the state – it is no small challenge.

Despite many in-state efforts to cut gas and diesel use over the past decade, population and economic growth have erased many of the fuel use reductions achieved. This year, through dedication by Governor Brown and the legislature to fight climate change and make California stronger, there are promising solutions on the horizon. The solution making the biggest splash is SB 350 (De León) – a bill currently before the legislature – proposing (among other things) a statewide goal of 50 percent petroleum use reduction by the year 2030. With this ambitious goal, California can and will make real progress towards meeting its transportation needs using less oil for the years to come.

Understanding how California can meet a 50 percent petroleum use reduction goal by 2030, and why this goal is good for the state, hinges on four key concepts (explained in more detail here).

1) The growth curve for alternative fuels, and the vehicles that use them, is at an acceleration point – and there is more opportunity for growth

Many companies have made significant strides to build out deployment infrastructure for alternative fuels like electricity, advanced biofuels, and natural gas. This has made California ground zero for early-stage, mid-stage, and commercial deployment of alternative fuels and vehicles to everyday drivers. Noteworthy examples abound, including Community Fuels (biodiesel), Clean Energy Fuels (natural gas), NRG (electricity), and Neste Fuels (renewable diesel), among many others.

At the same time, others are making huge investments in fuel use in corporate fleets, including FedEx (delivery trucks), United Airlines (renewable jet fuel in airplanes), Waste Management (garbage trucks), and the Walt Disney Corporation (buses), to name just a few.

All these efforts make the state home to the fueling infrastructure and market readiness suitable for increased growth towards a more diversified fueling system and a cleaner transportation future.

2) Cars and trucks are getting much more efficient at using gasoline and diesel, but there is still room for improvement

With regulations either on the books or proposed, the national average for vehicle efficiency is going to increase dramatically by 2030. According to the Center for Climate and Energy Solutions and the International Council on Clean Transportation, for the combined passenger vehicle and light duty truck fleet, the average new vehicle efficiency is scheduled to improve from where it is today at 32.6 miles per gallon (MPG) to 48.7 MPG by the year 2025, or an improvement of 38 percent. Additionally, with newer models of plug-in hybrids like the Prius, BMWi3, and Chevy Volt that are able to switch seamlessly from gasoline to electric drive and get over 100 MPG, there’s ample room to exceed existing targets – especially if new standards and incentives are developed.

3) Changes in driving habits, new mobility solutions, and coordinated urban planning are meeting transportation needs with more efficient and diversified solutions – and the trend is expected to continue

While there is no one single reason for the long-term shifts in driving habits of everyday people, one thing is clear –Californians have a different view of how driving can meet mobility needs today than in years past. This change in perspective is yielding changes in overall vehicle miles travelled (VMT) on a year over basis. And in California, new alternative mobility solutions, emerging technologies, and coordinated transportation planning are likely to continue the state’s legacy as a pioneer for changes in the owner/vehicle relationship for many years to come. Overall, if developed with reduced petroleum use in mind, these solutions can yield significant fuel savings that help meet long-term goals while maintaining mobility needs.

4) Setting a 50 percent petroleum use reduction standard drives innovation and investment while keeping money in California’s economy, yielding massive room for additional economic development across the state

Part of the rich history and “secret sauce” that makes California great is the fact that solutions to pressing issues are developed here. Creativity, ingenuity, and technology are all part of it – and a 50 percent petroleum use reduction goal can help unleash these drivers of innovation just as renewable energy targets and leaded gas phase-out requirements have done in the past.

California uses more gasoline and diesel than any other state. Over 60 percent of this fuel comes from imports, meaning cutting petroleum use in California reduces the money being sent out of the state, and out of the nation, every year. According to University of California Davis economist David Roland-Holst, every dollar saved at the pump can amount to $16 dollars of net economic activity – yielding significant job creation through reinvestment in California companies and communities. Consider a reduction of nine billion gallons of gasoline and diesel purchased at the pump every year (about a 50 percent reduction in use). At a conservative $3 per gallon, that comes out to $27 billion every year that can be saved by motorists in 2030– or $432 billion in net economic activity for the state.

Even without a crystal ball, the future for California’s prosperity is clear

Of course, not knowing the future is difficult and can stand in the way of supporting a goal as lofty as 50 percent petroleum use reduction. However, as shown by the wide array of solutions on the table now, and those on the near horizon, California has little to lose and everything to gain – and a 50 percent reduction in petroleum use is within reach. Long- term transitions to cleaner fuels, more efficient vehicles, reduced fuel use and imports overall, and lower cost easy-access mobility solutions that will result from the passage of SB 350 are beneficial to all Californians – and will result in a stronger economy, better public health, and more choices for all.

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