As the world’s largest automobile markets, the United States and China lead the world in oil consumption, importing more than half the petroleum they consume. The CERC-Clean Vehicles Consortium seeks to reduce this oil consumption by supporting the joint research of the nations’ leading experts in clean vehicle technologies. The University of Michigan’s Prof. Huei Peng and Tsinghua University’s Prof. Minggao Ouyang lead this effort.
This report is authored by U-M Department of Economics PhD student Alecia Cassidy. The energy efficiency gap is the failure of consumers or producers to make energy efficiency investments that would seemingly save money or increase profits. The phenomenon is important to understand, because if it exists and reflects irrational decisions on the part of consumers or firms, then policy intervention might be warranted. This report examines evidence for the energy efficiency gap in the automobile industry, and ultimately finds that the evidence is inconclusive. Three general approaches were employed: survey research, reduced-form analysis, and discrete choice modeling. Survey research finds evidence of an energy efficiency gap. Reduced-form analyses find no energy efficiency gap. The results of discrete choice models differ, with some finding evidence of an energy efficiency gap and others finding no evidence.
Huei Peng has been named director of U-M's Mobility Transformation Center, an interdisciplinary research unit of the U-M Office of Research, and Carrie Morton has been appointed deputy director of the MTC.
Peng is the Roger L. McCarthy Professor of Mechanical Engineering, and he has served as associate director of MTC since its launch in 2013. His research focuses on the design and control of electrified vehicles, and connected and automated vehicles.
American consumers have been enjoying Christmas since July – that is, July 2014, when the average price for all grades of gasoline peaked at US$3.75 per gallon, according to the Energy Information Administration. Since then, prices have declined substantially, as every motorist knows: to $2.90 by Thanksgiving 2014 and to $2.14 as we approach the end of 2015. In many parts of the country, the price of regular gasoline is well below $2 per gallon today.
On November 30, as the Paris international climate conference was getting underway, the U.S. Environmental Protection Agency (EPA) announced a long-overdue update of Renewable Fuel Standard (RFS) requirements. Originally established in 2005 and then greatly expanded by the Energy Independence and Security Act (EISA) of 2007, the RFS mandates increasing use of ethanol, biodiesel and other biofuels in America's cars and trucks.