Motor Vehicle CO2 Emissions in the United States: Potential Behavioral Feedback and Global Warming

The previously found correlation of average annual temperature and motor vehicle travel among U.S. states suggests amplifying feedback of increased carbon dioxide (CO2) emissions and warming. This study employed a regression model relating average annual temperature to motor vehicle CO2 emissions among the 48 contiguous states, controlling for other factors that affect travel. Increased emissions were associated with higher temperatures during 2000–14. Application of the model to 2015–16 data indicated that 27 million metric tons of CO2 emissions in 2015 and 38 million metric tons in 2016 would have not occurred if the average annual temperatures among U.S. states in those years had remained at 2014 levels. A 2018 proposal by the U.S. government to reduce future vehicle fuel economy standards ignored the potential effect of warming on vehicle travel and contained erroneous analyses of the relation of vehicle weight to fatality risk, vehicle scrappage rate to new vehicle sales, and the relation of new vehicle costs to fuel economy. Huge improvement in fuel economy and reduced CO2 emissions based on required hybrid technology are possible at reasonable cost.

Vehicle Scrappage and Gasoline Policy

We estimate the sensitivity of scrap decisions to changes in used car values and show how this “scrap elasticity” produces emissions leakage under fuel efficiency standards, a process known as the Gruenspecht effect. We first estimate the effect of gasoline prices on used vehicle values and scrappage of vehicles with different fuel economies. We then estimate the scrap elasticity itself, which we find to be −0.7. When applied in a model of fuel economy standards, 13–16 percent of the expected fuel savings leak away through the used vehicle market. This effect rivals or exceeds the importance of the often-cited mileage rebound effect. (JEL H23, L62, L78, Q35, Q38, Q48, Q58)