Wednesday, the Wall Street Journal ran a front page article (subscriber link) on one of the challenges of alternative fuel - getting consumers to buy in:
For a quarter century, California has pursued petroleum-free transportation more doggedly than any other place in the U.S. It has tried to jump-start alternative fuels ranging from methanol to natural gas to electricity to hydrogen. None has hit the road in any significant way. Today, the state that is the world’s sixth-largest economy finds itself in the same spot as most of the planet: With $75-a-barrel oil, and increasing concern about the role fossil fuels are playing in global warming, 99% of its cars and trucks still run on petroleum products.[.]
The question today is whether the resurgence of high oil prices and the rise of global-warming concerns will give alternative fuels sustained backing. Already, ethanol, the brew now generating the biggest buzz, is hitting many of the same roadblocks that slowed California’s past alternative-fuel attempts.
GM and Chevron are bickering over the ethanol demonstration project that is set to include the pump in Oakland and one near Sacramento. It’s a chicken-or-egg dispute. GM, which for years has been building “flexible-fuel” vehicles that can burn ethanol but typically don’t, wants Chevron to install a lot of ethanol pumps. Chevron, which estimates that installing a single ethanol pump and related equipment costs more than $200,000, wants to go slow to make sure first that consumers will buy the fuel.
In a picture attached to the online article, there’s a sign from a gas station in San Diego, advertising:
- Regular Unleaded: 3.299
- Super Unleaded: 3.419
- Premium Unleaded: 3.539
- Ethanol: 3.099
- Diesel: 3.249
- Bio-Diesel: 3.249
- Natural Gas: 2.399
- Propane: [no price shown]
One of the longest gas price signs I’ve seen, I think, due to the variety of choices available.
With that aside, the “chicken-or-egg” problem is, I think very real. What’s the economic incentive for manufacturers and the energy companies to shift off petroleum and on to alternative fuels? Why should the average consumer want to make the switch?
Hopefully, the price of petrol these days makes alternative fuels look more practical, more economic. However, as much as I would like to believe that some folks would make the switch solely because it’s the right thing to do, I don’t see that strong a reason yet for a consumer’s pocketbook to “encourage” the change.