Cash for Clunkers, Energy Saved or Energy Burned?

I’ve been thinking about this cash for clunkers program and wondering if it really is better for the environment. In other words, if we take all of these gas guzzlers off the street and replace them with fuel efficient sedans, will the energy/environment savings in gas actually be greater than the cost of producing a brand new car? To find out, I consulted some e-literature and a pad of scrap paper and pen. This is what followed:

So far the average car being traded in on this program gets about 15.8 mpg, while the average new car being sold in the program gets 25.4 mpg, a difference of 9.6 mpg. Now, let’s assume the average person puts 10,000 miles on their car annually; if this average person is saving 9.6 mpg over 10,000 miles they are saving about 1,041 gallons of gas, annually. This number times the 250,000 cars that will be replaced with this program works out to about 60 million gallons of gas being saved per year through the program. In energy terms this is about 8 million Gigajoules of energy per year. Remember this number. With this program we will save 8 million Gigajoules of fossil fuel energy (not including the energy required to find, get, and refine all that saved oil.)

Now, the next question is, how much energy are we wasting by making all these new cars? Sure, I know what you’re thinking; the old cars will be replaced soon anyway because they’re old cars. Well, let’s just assume that they would be on the road for at least one more year if it weren’t for this program. In other words, if the average car lasts 15 years, we are producing 1/15th more cars than we need in the new cars bought with the program. Have I lost you yet? I hope not.

According to an unofficial study, the average car requires about 73 gigajoules of energy to manufacture at the beginning and dispose of when it dies. Over the fifteen year life of the car, this is 4.9 Gigajoules each year. This 4.9, times the 250,000 extra cars from the program equals about 1.2 million Gigajoules of energy spent. This is our other big figure. Although we spend 1.2 Gigajoules of fossil fuel energy producing these new cars a year early, we save 8 million Gigajoules on their fuel efficiency over that year. You could say we are saving 667% more energy than we are using. This was a huge surprise to me.

Now, the cost to the American tax payer? We are paying $1.11 per gallon of gas saved over the life of these new cars. In other words, each pound of carbon emissions saved costs the taxpayer just under 6 cents, which is near the lower end of the range (4.5-13.5 cents per lb.) that current carbon sequestration technology costs. (As a side note, the Dept. of Energy hopes this cost per pound will be down to 0.5 cents per pound by 2015).

In layman’s terms, the gov’t made a decent decision in this case. I have to admit that I’m surprised. I was expecting this to be a classic case of someone slapping the “Green” label on another shortsighted idea. Kudos to the current administration.

(As a caveat, I have to say that this is all assuming the gov’t should use tax money to solve an issue of the commons or to stimulate the economy. That, obviously, will be up for debate indefinitely.)