be essential. The only alternatives are nuclear power and renewable energy sources, including biofuels. Applying CCS to biofuel production could result in slightly negative net emissions.
Consumer Barriers (Chapter 4)
- Widespread consumer acceptance of alternative vehicles and fuels faces significant barriers, including the high initial purchase cost of the vehicles and the perception that such vehicles offer less utility and convenience than conventional ICEVs. Overcoming these barriers is likely to require significant government policy intervention that could include subsidies and vigorous public information programs aimed at improving consumers’ familiarity with and understanding of the new fuels and powertrains. Consumers are used to personal vehicles that come in a wide variety of sizes, styles, and prices that can meet most needs ranging from basic transportation to significant cargo hauling. Conventional ICEVs can be rapidly refueled by a plentiful supply of retailers, effectively giving the vehicles unlimited range. Conversely, in the early years, alternative vehicles will likely be limited to a few body styles and sizes and will cost from a few hundred to many thousands of dollars more than their conventional ICEV counterparts. Some will rely on fuels that are not readily available or have limited travel range, or require bulky energy storage that will limit their cargo and passenger capacity.
Additional Findings from Policy Modeling (Chapter 5)
- Including the social costs of GHG emissions and petroleum dependence in the cost of fuels (e.g., via a carbon tax) provides important signals to the market that will promote technological development and behavioral changes. Yet these pricing strategies alone are likely to be insufficient to induce a major transition to alternative, net-low-carbon vehicle technologies and/or energy sources. Additional strong, temporary policies may be required to break the “lock-in” of conventional technology and overcome the market barriers to alternative vehicles and fuels.
- If two or more of the fuel and/or vehicle pathways identified above evolve through policy and technology development as shown in a number of the committee’s scenarios, the committee’s model calculations indicate benefits of making a transition to a low-petroleum, low-GHG energy system for LDVs that exceed the costs by a wide margin. Benefits include energy cost savings, improved vehicle technologies, and reductions in petroleum use and GHG emissions. Costs refer to the additional costs of the transition over and above what the market is willing to do voluntarily. However, as noted above, modeling results should be viewed as approximations at best because there is by necessity in such predictions a great deal of uncertainty in estimates of both benefits and costs. Furthermore, the costs are likely to be very large early on with benefits occurring much later in time.
- It is essential to ensure that policies, especially those that focus on investment in particular technologies, are not introduced before those new fuel and vehicle technologies are close to market readiness and consumer behavior toward them is well understood. Forcing a technology into the market before it is ready can be costly. Conversely, neglecting a rapidly developing technology could lead to forgone significant benefits. Policies should be designed to be adaptable so that mid-course corrections can be made as knowledge is gained about the progress of vehicle and fuels technologies. Further, it is essential that policies be designed so that they can be adapted to changing evidence about technology and market acceptance, and market conditions.
- Depending on the readiness of technology and the timing of policy initiatives, subsidies or regulations for new-vehicle energy efficiency and the provision of energy infrastructure may be required, especially in the case of a transition to a new vehicle and fuel system. In such cases, policy support might be required for as long as 20 years if technological progress is slow (e.g., BEVs with lithium-ion batteries may require 20 years of subsidies to achieve a large market share).
- Advance placement of refueling infrastructure is critical to the market acceptance of FCEVs and CNGVs. It is likely to be less critical to the market acceptance of grid-connected vehicles, since many consumers will have the option of home recharging. However, the absence of an outside-the-home refueling infrastructure for grid-connected vehicles is likely to depress demand for these vehicles. Fewer infrastructure changes will be needed if the most cost-effective solution evolves in the direction of more efficient ICEVs and HEVs combined with drop-in low-carbon biofuels.
- Research is needed to better understand key factors for transitions to new vehicle fuel systems such as the costs of limited fuel availability, the disutility of vehicles with short ranges and long recharge times, the numbers of innovators and early adopters among the car-buying public, as well as their willingness to pay for novel technologies and the risk aversion of the majority, and much more. More information is also needed on the transition costs and barriers to