Cheaper Fuels for the Light-Duty Fleet: Opportunities and Barriers

Resources for the Future Discussion Paper No. 13-28-REV

91 Pages Posted: 19 Sep 2013 Last revised: 3 May 2014

See all articles by Arthur G. Fraas

Arthur G. Fraas

Resources for the Future

Winston Harrington

Resources for the Future

Richard D. Morgenstern

Resources for the Future

Date Written: January 27, 2014

Abstract

The shale gas revolution in the United States has reduced the price of natural gas (NG) significantly. Combined with new fuel and vehicle technologies, an opportunity exists to expand the use of NG throughout the economy, including in the light-duty fleet of cars and trucks. This expansion could involve the direct combustion of the gas in the form of compressed natural gas or liquid petroleum gas or, alternatively, the use of natural-gas-based liquid fuels such as ethanol or methanol. This paper examines the potential economic, environmental, and national security gains from replacing a portion of the domestic gasoline use in the light-duty fleet with these various NG-based fuels. Also examined are the regulatory barriers to the expanded use of the fuels. We find that certain NG-based fuels could yield significant fuel cost savings relative to conventional gasoline in the light-duty fleet, along with gains to national security and, possibly, some environmental benefits.

Keywords: energy, natural gas, alternative fuels

JEL Classification: Q42, Q48, Q53, Q55

Suggested Citation

Fraas, Arthur G. and Harrington, Winston and Morgenstern, Richard D., Cheaper Fuels for the Light-Duty Fleet: Opportunities and Barriers (January 27, 2014). Resources for the Future Discussion Paper No. 13-28-REV, Available at SSRN: https://ssrn.com/abstract=2328301 or http://dx.doi.org/10.2139/ssrn.2328301

Arthur G. Fraas

Resources for the Future ( email )

1616 P ST, NW
Washington, DC 20036
United States

Winston Harrington

Resources for the Future ( email )

1616 P Street, NW
Washington, DC 20036
United States
(202) 328-5112 (Phone)
(202) 939-3460 (Fax)

Richard D. Morgenstern (Contact Author)

Resources for the Future ( email )

1616 P Street, NW
Washington, DC 20036
United States

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