Automotive Industry Trends
July 2006
Automotive Economy: The Fuel Future
![]()
Four primary motives drive the search for workable alternatives to petroleum as a fuel source:
- decreased risk of health effects caused by poor air quality
- national security through self-reliance
- cost control
- reduction of greenhouse gas emissions that contribute to global warming
These are powerful stimulants that keep the auto industry in a perpetual state of alertness—pursuing quixotic innovations, forcing the acceleration of technology timeframes.
Just for the Health of It
Since the middle of the last century, legislation has compelled manufacturers and consumers to clean up the air. Yet in many U.S. cities, air quality is still poor. Gases, toxins, and particulate matter have negative health effects on residents, worsening cardiopulmonary conditions, such as heart disease, asthma, and emphysema, contributing to the rise of lung cancer rates and even causing death for people at risk.
Safe and Sound
The safety of the air we breathe is vital of course, but volatile geopolitical circumstances dominate concerns over future fuel sources. As proven oil reserves around the world dwindle, some regions with a pauper’s share feel the pinch, and others with abundant supplies feel empowered. The United States currently consumes more than 20 million barrels a day, 50% of which is imported. Our needs are increasing, along with those of rising economies such as India and China, but globally, for every barrel of oil found, six are consumed, and therefore, competition for oil will become rigorous in the very near future. That competition will involve seeking favorable trade with some of the world’s most conflicted regions—Africa, South America, and the Middle East. Self-reliance is the key to sane foreign policy and greater national security.
The Control of Cost
Just as self-reliance is important for reasons of national security, it is also important for containing costs. Though Europeans and the Japanese are accustomed to paying $5 per gallon of gas—and a whopping $7 in Amsterdam—American consumers balk at recent increases to about half that price. Unfortunately for struggling U.S. carmakers, higher gas prices mean lower sales and diminished profit, and high costs at the pumps can cause quakes that rumble through the entire economy with destructive effects. There are also hidden costs for imported oil that most consumers don’t consider in their monthly gasoline budget, such as government subsidies to oil companies, defense outlays to stabilize oil-rich regions, and a mushrooming trade deficit partly composed of imported oil.
Hot Enough for You?
Though the topic of global warming is hotly contested in political circles, there is little doubt in the scientific community that it would be wise to control and eventually eliminate the human contribution to climate change. Predictions vary about what may happen during the course of climate change, but none of them paint a positive picture. It seems that whatever we have that we don’t want, we’ll have more of, and if there’s something we need more of, we’ll no longer have enough.
Which Way Now?
So, with these needs in mind, how do alternative fuels stack up?
Biodiesel is a biofuel that works well for trucks, buses, and heavy equipment. It is available for use today and is produced from organically derived oils through the process of transesterification.
- Health: It offers reduction by about half for harmful emissions of unburned hydrocarbons, carbon monoxide, and particulate matter and even greater reductions of carcinogenic nitrated hydrocarbons, but it increases smog- and ozone-forming nitrogen oxides. Biodiesel does not cause emission of the sulfates that are responsible for acid rain.
- Security: Because the oils are derived from plants, biodiesel can be produced from an abundant, renewable, and entirely domestic supply.
- Cost: The vegetable sources for biodiesel can be obtained quickly and cheaply. The transesterification process yields methyl esters (biodiesel) and glycerin (a valuable byproduct). Few or no modifications of today’s vehicles are required, so fleets can keep their legacy vehicles and parts inventories.
- Global warming: Though it reduces emissions of greenhouse gases, the explosive increase in vehicle ownership in expanding economies could negate this benefit in a short time.
Ethanol is fermented from grain and is already in use around the world, especially in the form of E85, a mixture of 85% ethanol and 15% gas.
- Health: Ethanol reduces emissions of dangerous substances into the atmosphere at varying percentages, the highest being sulfur dioxide by up to 80%.
- Security: As with biodiesel, the security benefits are enormous, because ethanol can be made from entirely domestic sources of vegetable matter, wood industry waste, even municipal waste, animal manure, and sewage sludge.
- Cost: Ethanol provides 15% lower mileage than gasoline, but its sources are abundant, cheap (or in some cases free), and renewable.
- Global warming: Ethanol is only a small step toward the zero emission vehicle, but perhaps its greatest contribution will be as the reformer fuel of choice for hydrogen vehicles.
Natural gas, formed from plants by geological processes, has long been used for cooking, heating, and fuel. More than one million vehicles on the world’s roads today use natural gas.
- Health: Natural gas burns more cleanly than gasoline, reducing tailpipe emissions of nitrogen oxides, hydrocarbons, and particulate matter, however, vehicles powered by gas emit substantial amounts of methane.
- Security: The United States has vast proven reserves of natural gas buried in caverns beneath the earth, making it a beneficial domestic fuel source.
- Cost: Many in the transportation sector have already been rewarded by the switch to natural gas, finding it an inexpensive alternative to gasoline.
- Global warming: Natural gas burns more cleanly than gasoline, but it still releases substantial amounts of carbon dioxide, the most harmful of the greenhouse gases.
Electric vehicles, either battery-powered or hybrids, are becoming highly desired.
- Health: Electric cars are very low or zero emissions vehicles. Even when taking into account the power plant emissions from which the car’s energy comes, the electric vehicle is so much more efficient than the internal combustion engine, especially with regenerative braking, that the health benefit is colossal.
- Security: As with other forms of alternative energy, reliance on U.S. resources—domestic power plants plus a small amount of fossil fuel—makes the nation safer and protects from price shocks caused by international strife.
- Cost: Electric vehicles are one of the most economical modes of transport available, and as technology makes the shift from nonrenewable energy sources to renewable ones, scale will permit even greater savings.
- Global warming: The electric vehicle has low or no tailpipe emissions that contribute to the danger of global warming, so its rating depends on where its energy comes from: coal, natural gas, hydropower, nuclear power, or other sources.
Hydrogen cars represent an example of the unlimited potential of the hydrogen future. Hydrogen is the most plentiful gas in the universe (though it never occurs by itself in nature), and harnessing its energy is a vision toward which much research and development is directed.
- Health: The byproduct of hydrogen energy consumption is pure water. Shuttle astronauts drink it during missions in space. For vehicles, the tailpipe emission is nothing more than water vapor.
- Security: Hydrogen is available in an unlimited supply and therefore offers complete independence.
- Cost: Today, compressed hydrogen costs about four times as much as gasoline. GM’s Hy-Wire gets 41 miles per gallon of gasoline equivalent (gge) (it has a range of only 80 miles); however, U.S. Department of Energy sources project that the cost will drop to $2/gge by 2012; and new technology will double the range by increasing tank pressure to 10,000 psi.
- Global warming: An energy infrastructure that can accommodate hydrogen and an inexpensive form of extraction are its biggest stumbling blocks, but clean and abundant alternatives are in development (cellulosic ethanol offers a 200% net carbon reduction) and may represent the path to a future of clean, cheap, renewable, and bountiful fuel for tomorrow’s vehicles.
Subscribe to eNewsletter