When did you last see an advertisement or a TV programme proclaiming the virtues of smaller engines for cars? Attempts to persuade us that car-makers believe in 'green driving' tend to concentrate on hybrid vehicles and, as at the Geneva car show, future generations of electric vehicles (Transport Commentary, 10 March 2010).
This misses the point that the best way to improve fuel efficiency really is to buy a car with a smaller engine. Market analyst firm Frost & Sullivan says in a recent note [registration required]: "The most important tool to reduce emissions among powertrain technologies is engine downsizing." Unravel the jargon about 'powertrains' and 'engine downsizing' and this boils down to smaller engines rather than new technologies that will take decades to have an impact. "Engine downsizing alone can reduce emissions up to 10 per cent, when compared to the base engine."
The note also points out that smaller engines can be more effective than hybrids. "The Volkswagen Polo 1.2 litre diesel engine … emits 87g/km of CO2, which is lower than the CO2 emissions of the Toyota Prius that is a gasoline hybrid." You also save around 5000 Euros.
We even have some evidence about how buyers and sellers of cars look at fuel economy in a discussion paper prepared for the OECD's International Transport Forum: "Why The Market For New Passenger Cars Generally Undervalues Fuel Economy".
David Greene, of the Transportation Research Center at the Oak Ridge National Laboratory, looks at "How markets determine the energy efficiency of new vehicles".
The title of the report says it all really. Author David Greene, from the Transportation Research Center at the Oak Ridge National Laboratory, concludes that "If consumers undervalue fuel economy improvements relative to their expected present value over the full life of a vehicle, the market will provide too little fuel economy and will under-invest in research and development of energy efficient technologies."
The real point of this study, though, is that we need a better understanding of how the market for fuel economy works in practice, not just theoretical models. As Greene puts it: "Policy analysis must be based on how real world markets actually function."
Without that understanding, governments end up pressing the wrong buttons in their attempts to persuade us to reduce CO2 emissions as we drive. For example, "policies that influence the market via purchase price such as feebates [a package of fees and rebates], or regulatory policies such as fuel economy standards will have greater leverage on fuel economy than fuel prices".
Talk of smaller engines may not mean much to the 1002 people who, according to Fortune magazine, bought a new Rolls-Royce last year, with its "EPA mileage rating of 13mpg city/20mpg highway". However, those of us who have to fuel our own vehicles and have seen the inexorable rise of petrol prices might think more carefully than about fuel efficiency the next time we consider buying a car.
In the UK, higher fuel taxes play a large part in government attempts to promote fuel-efficient driving. Maybe an election winner would be to promise lower petrol prices in return for some of those combinations of fees and rebates that make up bigger 'feebates' for people who opt for even smaller engines.
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