Saturday, July 07, 2007

Getting There Was More than Half the ...

For my second to last post about our trip to Hawaii, I wanted to point out something about energy consumption and CO2 emissions that I had not previously appreciated.

We flew from Boston to San Francisco (2704 miles) and then San Francisco to Honolulu (2398 miles), for a total of 5102 miles each way or 10204 miles total. How much fuel did we use (assigning us our per capita share for the plane as a whole)?

This page cites an FAA estimate of 48 miles-per-gallon-per-seat and notes that a gallon of jet fuel and a gallon of gasoline create about the same amount of CO2 emissions. This means that as a family, our share of the fuel used was about 4 x 10204 / 48 = 850 gallons. Let's compare that to two other fuel numbers around the Samwick household.

First, I estimate that we drive our cars no more than 1000 miles a month on average and get at least 20 miles per gallon on average, resulting in gasoline consumption of no more than (12 x 1000 / 20) = 600 gallons per year.

Second, we have used about 1100 gallons of #2 fuel oil to heat our home in each of the past few years. (What can I say, we like to be comfortable?) This page shows the CO2 emissions by fuel type, putting the fuel oil on a par with jet fuel, which are both a bit higher than gasoline.

One (glorious) trip to Hawaii used 75% of the fuel we use to heat our home or 140% of the fuel we use to power our cars, with corresponding amounts of CO2 emitted.

As it pertains to energy and environmental policy, this example shows how important it is to be comprehensive in our attempts to reduce oil demand. The most straightforward way to do that is to levy a tax on all fuel products derived from petroleum. It allows abatement to occur at every possible margin--by flying, driving, or heating less or by using technologies that are more fuel efficient.


Lord said...

Don't forget coal, and to a lesser extent natural gas.

Fritz said...

Why would an economist propose a policy that would lessen potential GDP when cheaper alternative methods to produce clean energy that enhance potential GDP exist? Al Gore is a politician, it is understandable why he leaves nuclear power out of the energy debate, but you have no such luxury afforded to you. Like primary K-12 education, the solutions always cost more without obtaining the primary objective of educating.

Andrew Samwick said...

The post says that taxing oil is better than regulating only a subset of the CO2-emitting products that may be derived from that oil. This is true regardless of how much nuclear power is produced.

Mark said...
This comment has been removed by the author.
brent mullins said...

I wrote this into Marketplace, over your extended column on this topic:

For an economist, the numbers sure don't add up.

850 gallons of fuel to Hawaii? @ $4/gallon, the approximate current price, that would = $3400. But airfare [presuming he was on a paid, not mileage ticket] is approximately the same, or less--so if his fuel rate was correct, NO airline would still be in business, considering fuel is only deemed to be about 1/3 of their total costs.

He then abruptly switches from his fly-in lead to cars, advocating taxes as the best way to reduce carbon emissions. So how to reduce airplane emissions? Would he like to be heavily taxed [above and beyond all the ding ding "security" taxes they have now]?? How heavy would it have to be to prevent dragging his family 10,000 miles for their "glorious" vacation??

Even given the [good] impulse to translate personal experience to a larger policy issue, this commentary was a massive failure, completely undercutting any credibility his proposal may have had.

Andrew Samwick said...

Within the space provided for the commentary, it does note that the trip was for a family of four. So cut your ballpark estimate for the price of the ticket down to $3400/4 = $850.

The commentary does not indicate when the trip was taken, but you can see by the date on the post here that it was last summer, so your estimate of the fuel costs is also too high. You can go to the EIA's page on jet fuel and see that the price a year ago was about 55% of the current price. So again multiply your estimate to get $850 * 0.55 = $467.50.

That was about half the cost of each ticket.

brent mullins said...

I appreciate your answer--but your Marketplace piece didn't indicate how out out-of-date the trip was in relationship to fuel cost. And now I have further reason to question the underlying fuel cost assumption:

"Let's run the numbers on the latest model of the Boeing 737-900. The plane burns about 2.4 gallons per nautical mile, and a trip from New York to Los Angeles, California, is about 2,100 nautical miles. So that means it would take about 5,000 gallons of Jet-A fuel to fly coast to coast.

Now let's assume it is configured to hold about 175 people -- and the plane is full -- aren't they all these days? That comes out to 28.5 gallons per passenger."

Extrapolating the gallons to Hawaii on that basis isn't anything close to the 850 total you referred to.

And perhaps more importantly, you didn't address the underlying idea of what it would take to discourage--by means of tax--such lengthy trips as yours.

Andrew Samwick said...

The Marketplace commentary did not rely on the cost of the trip to make its point. That came up when you made your comment, claiming that the fuel costs were too high relative to the price of the ticket.

The CNN article you cite is making best-case comparisons across a newer (and presumably more fuel efficient) airplane and a very fuel efficient car. In the post, I link to an estimate of 48 miles per gallon per seat from the FAA. It is an average across aircraft types and it accounts for extra fuel used during taxiing and holding patterns. I think your estimate is a bit low. It's certainly possible that mine is too high for four long-haul segments on fairly full planes.

But even using your estimate, we're at about 200 gallons for the four of us, which is a third of what we put in our car in a whole year. (I would also acknowledge that we use less than most in the car.) A key point of the post is one of substitutability across all margins of fuel use. I don't see the wisdom in focusing on my car trips and not my trips by air.

Your hunch is correct. In this particular case, we would have gone to Hawaii even if fuel costs were substantially higher. That's because it was a mostly leisure trip to Hawaii. There are plenty of other trips that are more price sensitive, as are other dimensions like how far to travel and whether to bring the kids.

But another aspect of fuel taxation or conservation is to avoid or remediate environmental damage. As in the case of substitution, why should people who use 200 gallons in the air or 1000 gallons at the thermostat escape these costs and those who use 600 in the gas tank have to pay them all?