Attention Governor Rendell and members of the PA House and Senate: A sure way to simultaneously raise revenues and increase the use of fuel efficient vehicles is to implement a program that offers rebates to buyers of fuel efficient vehicles and penalizes buyers of gas guzzling vehicles through a fuel inefficiency tax. This proposal is likely to spark a debate between the folks who claim it would provide a death blow to US auto manufacturers and those like me who believe we must take a more aggressive approach to raising the average fuel efficiency of our vehicle fleets. Recent news suggest that this is certainly not the case, as US manufacturers, led by GM, are closing the fuel efficiency gap between themselves and Toyota, the leading hybrid manufacturer.
Another potential pitfall is that some would argue that this plan would penalize small business owners who need pick up trucks and SUVs to do their work. This is indeed a fair argument, although there should be hybrid options and this new state rebate that would encourage them to drive an SUV that is not in the penalty zone. Certain vehicles should be exempted from this, and some work would have to be done to see which average mpg would be in the neutral zone - meaning your vehicle that attains average fuel efficiency would get neither a rebate or penalty.
Backing up a few steps, I want to share with you some of the logic behind this idea. First, this would not be the first time I have suggested this, as I thought of this a while back and blogged about it here on Green is Good. Recent news headlines coming out of Canada brought this idea back on my radar screen. Canada's Finance Minister is under attack by the auto unions for his proposal for a similar fuel efficiency rebate program. The current proposal is to offer rebates for purchases of certain vehicles, but the most polarizing part of the plan, the list of vehicles that will be penalized, has not been formalized. The last part, the penalty aspect, is the key, because although rebates are good, they do not get people to act as quickly as a bill in the mail stating they owe the federal government $2000 for their purchase of an inefficient vehicle.
Back to the logic behind the plan. The other day I was driving in a suburban shopping center while I noticed the size of a black Cadillac Escalade EXT. This thing was enormous - almost as big as a city bus, and it got me thinking to this idea I had a while ago - the people that drive these things are ridiculous. There is no excuse for driving a truck that big that gets close to 10 mpg. The cost of tank of gas in these things is at least $100 - yet that is not enough to get someone to drive a hybrid SUV.
Well, I have accepted that we cannot force people to change for the better of society, so if individuals want to continue to practice free choice of driving whatever they feel like driving, even though it is a detriment to us all - make them pay for it. These individuals should either pay an extra $1000 or $2000 fuel efficiency "tax" when purchasing a $70,000 Escalade or they can go ahead and purchase a Toyota Highlander Hybrid which achieves a combined 12 miles per gallon more than the standard Escalade model and comes with federal tax credits at almost half of the cost of the Cadillac. Not a bad trade off if you ask me.
2007 Cadillac Escalade AWD
2007 Toyota Highlander Hybrid 4WD
|New EPA MPG|
Now, if you ask me what the US auto manufacturers should do - they need to continue to invest in hybrid and battery technology so that every vehicle that they manufacture includes a hybrid electric system. The key roadblock to making this a reality is the high cost of the hybrid system. Even though this should only take at the most a few years to figure out, the auto industry continues to lobby the US Congress for more time - 20 more years to be more precise. We should not sit by idly waiting for them to figure it out while individuals who drive the guzzlers get a free ride to polluting our environment and contributing to to the congestion and smog in our cities.
I hope our leaders here in PA and also nationally will have the guts to implement an aggressive, sensible, and yes, controversial plan like this because just asking people to drive hybrids and more fuel efficient vehicle is not enough. The carrot and stick principle is the only way this can work.