fleet would have to be reduced by 50 to 70 percent per gallon of gasoline equivalent (gge) by that time.

Finding: Meeting the study goals requires a massive restructuring of the fuel mix used for transportation. Petroleum-based fuels must be largely eliminated from the fuel mix. Other alternative fuels must be introduced such that the average GHG emissions from a gallon equivalent of fuel are only about 40 percent of today’s level.

3.1.2 Fuel Pathways

Many different alternative fuel pathways have been proposed, and this study selected seven different fuel pathways to analyze: conventional petroleum-based gasoline, biofuels (including ethanol and “drop-in”2 biofuels), electricity, hydrogen, compressed natural gas (CNG), gas to liquids (GTL), and coal to liquids (CTL). These were selected because of their potential to reduce petroleum use, to be produced in large quantities from domestic resources, and to be technically and commercially ready for deployment within the study period. Most fuels selected have lower net GHG emissions than petroleum-based fuels. Other alternative-fuel pathways were discussed but not included for detailed analysis because they did not meet the first three criteria. For example, methanol is discussed in Appendix G.8 but was not included for detailed analysis because of environmental and health concerns that inhibit fuel distribution and retail companies from broadly offering methanol as a fuel.

The fuel costs, net GHG emissions, investment needs, and resource requirements were analyzed on a consistent basis for the different fuels to facilitate comparisons among fuels. Future technology and cost improvements for the selected fuels are considered and compared on a consistent basis, even though the extent of improvement for different fuels is likely to vary.

3.1.3 Developing Trends in the Fuels Market

Several developments in the energy markets over the past few years will have large impacts on long-term LDV fuel-use patterns. First, the fuel economy of the LDV fleet will increase rapidly over the next decade because of higher Corporate Average Fuel Economy (CAFE) standards effective through 2016 and proposed through 2025. The CAFE standards increase requirements from 23.5 mpg in 2010 to 34.1 mpg in 2016 to 49.7 mpg in 2025. Alternative fuels and new LDV technologies would compete with future gasoline or diesel LDVs that use much less petroleum and have lower net GHG emissions. From a consumer viewpoint, the decreasing volume of gasoline needed to travel a mile reduces the economic motivation to switch from gasoline to an alternative fuel.

Second, biofuel production is expected to increase as a result of the Renewable Fuel Standard 2 (RFS2) passed as part of the 2007 Energy Independence and Security Act (EISA). This legislation mandated the consumption of 35 billion gallons of ethanol-equivalent3 biofuel and 1 billion gallons of biodiesel (about 24.3 billion gge/yr based on energy content) by 2022. The detailed requirements of RFS2 are discussed in Appendix G.1. Based on the 2010 gasoline use of 136 billion gge/yr (8.88 million bbl/d), this mandate increases biofuel use from 9.9 percent (0.87 million bbl/d) to 18 percent (1.59 million bbl/d) of the gasoline mix by volume (EIA, 2011b). Although the mandated volume for cellulosic biofuel is not expected to be met by 2022, any additional biofuel volume in the conventional gasoline mix reduces the need for gasoline from petroleum and the volume of other alternative fuels needed to reach the study goals. See Section 3.2, “Biofuels,” in this chapter for a detailed discussion.

Third, the volume of economic natural gas from shale deposits within the United States has been increasing rapidly. In its June 18, 2009, report the Potential Gas Committee upgraded by 39 percent the estimated U.S. potential natural gas reserves (defined as being potentially economically extractable by the use of available technology at current economic conditions) compared with its previous biannual estimate (Potential Gas Committee, 2009). Based on the new estimates, the probable natural gas reserves would provide about 86 years of consumption if the consumption rate stays at the current level. In 2011, the Potential Gas Committee increased its estimates such that 90 years of probable reserves exist based on 2010 consumption. Many previous studies on alternative fuels did not include natural gas as a possible source for LDV fuel because of limited domestic supply, and the likely price increase in electricity and residential heating costs associated with high natural gas use in the transportation market. With increasing domestic production, natural gas now is a viable option for providing transportation fuels through multiple pathways including electricity, hydrogen, GTL, and CNG. See Section 3.5, “Natural Gas,” in this chapter and Appendix G.7 for a detailed discussion.

3.1.4 Study Methods Used in the Analysis

This study considers conventional and alternative fuels for the 2010-2050 period, and this committee undertook a number of tasks to generate possible fuel scenarios and data for use in the modeling efforts described in Chapter 5. The primary sources for the data are different for each fuel and are explained in the sections that provide details on each fuel below in this chapter. The committee made efforts to standardize input data and definitions between the primary

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2Drop-in fuel refers to nonpetroleum fuel that is compatible with existing infrastructure for petroleum-based fuels and with LDV ICEs.

3A gallon of ethanol has about 77,000 Btu, compared with 116,000 Btu in 1 gallon of gasoline equivalent.



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