Essays on alternative energy policies affecting the US transportation sector
Abstract
This dissertation encompasses three essays evaluating the impacts of different policies targeting the greenhouse gas (GHG) emissions, fuel demands, etc. of the transportation sector. Though there are some similarities across the three chapters, each essay stands alone as an independent work. The 2010 US EPA MARKAL model is used in each essay to evaluate policy effects. Essay 1 focuses on the recent increases in Corporate Average Fuel Economy (CAFE) standards, and the implications of a "rebound effect." These increases are compared to a carbon tax generating similar reductions in system-wide emissions. As anticipated, the largest reductions in fuel use by light-duty vehicles (LDV) and emissions are achieved under CAFE. Consideration of the rebound effect does little to distort CAFE benefits. Our work validates many economists' belief that a carbon tax is a more efficient approach. However, because the tax takes advantage of cheaper abatement opportunities in other sectors, reductions in transportation emissions will be much lower than what we observe with CAFE. Essay 2 compares CAFE increases with what some economists suggest would be a much more "efficient" alternative – a system-wide oil tax internalizing some environmental externalities. Because oil taxes are likely to be implemented in addition to CAFE standards, we consider a combined policy case reflecting this. Our supplementary analysis approximates the appropriate tax rates to produce similar reductions in oil demands as CAFE (CAFE-equivalent tax rates). We discover that taxes result in greater and more cost-effective reductions in system-wide emissions and net oil imports than CAFE. The current fuel tax system is compared to three versions of a national vehicle miles traveled (VMT) tax charged to all LDVs in Essay 3. VMT taxes directly charge motorists for each mile driven and help to correct the problem of eroding tax revenues given the failure of today's fuel taxes to adjust with inflation. Results suggest that VMT taxes generate more revenue than our existing fuel tax structure, but do so at the expense of the LDV fleet becoming less fuel-inefficient. If stringent enough, VMT taxes can lead to some rather noticeable reductions in miles driven, fuel use, and emissions.
Degree
Ph.D.
Advisors
Tyner, Purdue University.
Subject Area
Environmental economics|Agricultural economics|Transportation planning|Energy
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