Driving a hybrid might make you feel better for helping the environment, but a study of the most common alternative fuels claims diesel provides the greatest benefit to consumers and to society.
It may surprise those who associate diesels with smoke-belching 18-wheelers, but a cost-benefit analysis by the RAND Corp. finds so-called advanced diesel engines provide a slight edge over gas-electric hybrids and both leave E85 in the dust.
Even more surprising? The study claims that the high cost and resource-intensive means of producing and transporting E85 - a mixture of 85 percent ethanol and 15 percent gasoline - makes it less beneficial to society than using straight gasoline.
"Advanced diesel and hybrid technologies show very well in this study, in terms of benefits to the individual and society overall," said John Graham, dean of the Pardee RAND Graduate School and senior author of the paper. "E85 simply doesn't provide the same results."
So what makes diesel so great? And are there any holes in the research? Read on...
The researchers examined the costs and benefits to consumers and to society of hybrids like the Toyota Prius, diesels like the Mercedes Benz E320 Bluetec and "flex-fuel" vehicles like the Chevrolet Impala that can run on E85. Each was compared to gasoline vehicles. The researchers said they omitted other fuels, such as compressed natural gas and electricity, because they don't see such vehicles being produced in great numbers during the next decade.
The researchers didn't drive the cars, they studied data from the National Highway Traffic Safety Administration, the Environmental Protection Agency and elsewhere.
To quantify the benefit to consumers, the researchers weighed the cost of the technology against its fuel savings, mobility (likelihood to induce travel by cutting fuel expenditures) and performance (measured by torque). Societal benefits were determined by the impact each technology has on pollution (including the pollution created in the production and shipment of the fuel), vehicle emissions and energy security, defined as the likelihood of each technology to ease dependence on foreign oil.
They assumed fuel prices of $2.50 a gallon for gasoline, $2.59 a gallon for diesel and $2.04 a gallon for E85, a figure that includes the federal tax credit of 51 cents a gallon.
So what'd they find?
Advanced diesel engines offer the greatest savings over the life of the vehicle, cutting fuel costs by $460 for a mid-sized car, $1,249 for a mid-sized SUV and $2,289 for a full-sized pickup. Hybrids offered savings of $198, $1,066 and $505 respectively. Why? Because hybrids are typically have much higher purchase prices than similar diesels.
"While it is assumed that the hybrid vehicle will save more fuel than the advanced diesel, the overall advantage goes to the diesel because of its lower technology costs and better performance, such as increased torque," Graham said. That picture could change, however, if the cost of hybrids comes down, he said.
The study found the operating cost of an E85 vehicle is higher than a similar gasoline vehicle because although E85 is cheaper than gas, it produces less energy so you have to burn more of it. Running E85 in a mid-sized car will cost you $1,034 more over the life of the car than using gasoline, the researchers concluded.
Things get harder to follow when it comes to assessing the societal benefits, as you can see from the study:
When those factors are considered, the researchers say, diesel provides the best societal benefit, narrowly edging out hybrids. Both, again, leave E85 in the dust. In fact, the researchers claim E85 won't produce net societal benefits unless production costs come down or gas prices maintain or exceed current levels. The nationwide average was just over three bucks a gallon last week.
Maybe we're missing something, but we see some holes in the study.
First, it doesn't consider the impact of tax credits and other incentives to use alternative fuels. Uncle Sam gives a tax credit for buying a new hybrid vehicle. Tack that on to the $198 savings in operating costs RAND says you'll enjoy with your new Civic hybrid and you've met, if not exceeded, the savings you'll see with a diesel.
The study did not consider the environmental impact of black carbon, which is produced by burning biomass and fossil fuels. The researchers concede that "might bias the climate analysis in favor of diesel." Indeed it does. As noted at Green Car Congress, scientists recently told the House Committee on Oversight and Government Reform that black carbon may be responsible for 16 percent of the warming we've experienced and is second only to carbon dioxide as a cause of climate change. That undercuts the advantage diesel engines have shown over gasoline engines with regard to greenhouse gas emissions. Whether it undercuts that advantage to give hybrids an added edge over diesels is much less clear.
But the point of the RAND study isn't to endorse one technology over all others, only to add to a growing body of research into the costs and benefits of alternative fuels. In fact, the researchers say automakers and policymakers shouldn't endorse one technology, but explore them all in a "portfolio strategy" and let the market decide the most viable option.
