that is used in the CAFE standard to calculate the fleet average fuel economy (the sales weighted average) for the city and highway cycles. The details of this calculation are shown in Appendix E. Fuel consumption is also the appropriate metric for determining the yearly fuel savings if one goes from a vehicle with a given fuel consumption to one with a lower fuel consumption.
Because fuel economy and fuel consumption are reciprocal, each of the two metrics can be computed in a straight-forward manner if the other is known. In mathematical terms, if fuel economy is X and fuel consumption is Y, their relationship is expressed by XY = 1. This relationship is not linear, as illustrated by Figure 2.1, in which fuel consumption is shown in units of gallons per 100 miles, and fuel economy is shown in units of miles per gallon. Also shown in the figure is the decreasing influence on fuel savings that accompanies increasing the fuel economy of high-mpg vehicles. Each bar represents an increase of fuel economy by 100 percent or the corresponding decrease in fuel consumption by 50 percent. The data on the graph show the resulting decrease in fuel consumption per 100 miles and the total fuel saved in driving 10,000 miles. The dramatic decrease in the impact of increasing miles per gallon by 100 percent for a high-mpg vehicle is most visible in the case of increasing the miles per gallon rating from 40 mpg to 80 mpg, where the total fuel saved in driving 10,000 miles is only 125 gallons, compared to 500 gallons for a change from 10 mpg to 20 mpg. Likewise, it is instructive to compare the same absolute value of fuel economy changes—for example, 10-20 mpg and 40-50 mpg. The 40-50 mpg fuel saved in driving 10,000 miles would be 50 gallons, as compared to the 500 gallons in going from 10-20 mpg. Appendix E discusses further implications of the relationship between fuel consumption and fuel economy for various fuel economy values, and particularly for those greater than 40 mpg.
Figure 2.2 illustrates the relationship between the percentage of fuel consumption decrease and that of fuel economy increase. Figures 2.1 and 2.2 illustrate that the amount of fuel saved by converting to a more economical vehicle depends on where one is on the curve.
Because of the nonlinear relationship in Figure 2.1, consumers can have difficulty using fuel economy as a measure of fuel efficiency in judging the benefits of replacing the most inefficient vehicles (Larrick and Soll, 2008). Larrick and Soll further conducted three experiments to test whether people reason in a linear but incorrect manner about fuel economy. These experimental studies demonstrated a systemic misunderstanding of fuel economy as a measure of fuel efficiency. Using linear reasoning about fuel economy leads people to undervalue small improvements (1-4 mpg) in lower-fuel-economy (15-30 mpg range) vehicles where there are large decreases in fuel consumption (Larrick and Soll, 2008) in this range, as shown in Figure 2.1. Fischer (2009) further discusses the potential benefits of utilizing a metric based on fuel consumption as a means to aid consumers in calculating fuel and cost savings resulting from improved vehicle fuel efficiency.
Throughout this report, fuel consumption is used as the metric owing to its fundamental characteristic and its suitability for judging fuel savings by consumers. In cases where the committee has used fuel economy data from the