What it takes

  • 14/02/2007

Fuel economy isn"t just good economics

VERY crudely, the less fuel the vehicle consumes, the less it emits. Regulators across the world look at this problem in two ways: one, they directly regulate fuel economy; two, they set standards for green house gas (ghg) or co2 emissions to address climate change, which indirectly regulates fuel economy. Countries like Japan, China and the us have set fuel economy standards that aim to get more miles per unit of fuel and reduce co2. The European Union has set targets for co2emissions reduction. California in the us has decided to set standards for greenhouse gas emissions.

Energy security concerns during the 1970s spurred the us to begin fuel economy regulations for vehicles.Subsequently, commitments made under the 1997 Kyoto Protocol to reduce ghg emissions to avert climate change, led other industrialised countries to design strategies to improve fuel efficiency. Since then, nine regions have implemented regulations that cover a very high proportion of the global vehicular fleet, markets and manufacturers.

Among the developing countries, only China has set fuel economy standards. It is also driven by concerns over its energy security.

The Pew Centre, a Washington, dc-based think-tank, hascompared all the different global fuel economy standards. It found that the European Union and Japan have the most stringent standards in the world. The us and Canada are the most lax. What is worth noting for the developing countries is that China has set fuel economy standards tighter than those prevailing in the us, California, Canada, and Australia (see graph: The global best and worst ).

Experience the world over shows fuel economy regulations need proper crafting. Lax standards or exemptions to bigger vehicles, for instance, encourage gas guzzlers.

In the us, suvs meet lower standards than cars. A rise in their numbers has meant a decline in the fuel economy there. The us also fails to regularly update standards that reflect new technologies.

But not diesel
Because it is not clean

Fuel efficiency is not a single step tango. Several trade-offs need to be considered so that increased emissions do not offset gains from efficiency. The use of diesel is one such instance.

In India, cheap prices have set off a mad rush for diesel cars. The lack of policy to make diesel cars pay for environmental costs has spurred the boom. The 2006 Union budget is good indication. It made the link between tax cuts and small diesel cars more explicit. While granting tax cuts to the small car segment, the government defined "small car" as one of length not exceeding 4,000 mm, with an engine capacity not exceeding 1,200 cc for petrol cars and 1,500 cc for diesel cars. The latter, more relaxed, limit allowed in large numbers of mid-segment diesel cars. Diesel car prices got slashed by about Rs 12,000 to Rs 25,000. According to information from siam the market share of diesel cars has rocketed over 30 per cent. Other estimates say that it is expected to be as high as 50 per cent by 2010. In Delhi alone, diesel cars have increased by 425 per cent between 1996 and 2006.

This increase in the use of diesel vehicles threatens to jeopardise public health seriously. Air quality in Indian cities is at risk and diesel technology, even with the current "best" Indian technology is highly polluting. A 2004 World Bank supported study assessed and attributed pm2.5

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