To be honest, I have a love/hate relationship with hybrid vehicles. Back in the early 90s I was converting gasoline cars to electric-powered lead weights that were surprisingly efficient but had severely limited range. My partners and I at the now defunct VT Electric Car Co. found that it was easier to convert cars than people’s driving habits, which had a dramatic effect on the range. Every sale (there weren’t many) came with a lesson on efficient driving techniques. You know the drill—keep your tires inflated and your speed at or below posted limits, no jack-rabbit starts, pace yourself so that you can coast to a stop while minimizing braking and re-acceleration. We found a customer base that easily “got it,” but the average test driver did not. This awareness can now be found in gas-electric hybrid car drivers. Now car manufacturers have given us a mass-produced vehicle class that offers a transition from gasoline to electric-only vehicles with familiar drivability and increased fuel efficiency. One hybrid car market report indicates that Vermont is the 4th most popular place for hybrids, estimating one new hybrid for every 2,000 residents, with Burlington alone accounting for about half that figure.

File Photo.

I’m a numbers guy, but I’m also passionate about energy and efficiency. Having earned my living for the past 20 years in the field of energy efficiency and renewable energy, I also live off-grid with solar and biodiesel, and wind power is on the way. Let’s look at the numbers first and see where the passion fits in. The 252,636 hybrids vehicles sold in the US in 2006 averaged just over 38 MPG weighted for the mileage and quantity of each vehicle sold. That’s about 11 mpg more than their gas-only counterparts. Assuming each car drives 100,000 miles over its lifetime, the fuel savings adds up to over 270 million gallons of gasoline—about 70-percent of the amount of gasoline burned on American highways each day. On a personal finance level, the lifetime fuel savings adds up to about $3,200 for each hybrid owner, if you pay $3.00 per gallon over the full 100,000 miles.

Tax Credits

In 2006, federal tax credits were offered for buyers of hybrid cars. Based on the specific tax credit for each vehicle, and assuming each buyer received the maximum credit (the actual credit amount is reduced once a manufacturer reaches a certain sales volume), I estimate the cost to the US Government totaled $670 million for 2006 hybrid purchases. That adds up to an equivalent value of $2.48 per gallon of gasoline saved, or about $104 per barrel of oil. If the number crunchers in Washington did their homework, the message is that they consider this to be a cost-effective savings measure that reflects the real cost of providing entry to a barrel of oil into the US economy. Certainly there is a cost associated with market transformation, and fuel economy is a good place to spend our money. If there is one worthy thing we can do with the last of the planet’s oil, it would be to build a clean energy future.

For perspective, my 1985 Honda Civic 4WD wagon got almost 40 MPG at legal highway speeds, my 1994 Toyota Corolla got about 33 MPG on average, my 2003 VW Jetta diesel gets 45 MPG, and the electric car conversion we did fifteen years ago offered the equivalent of over 100 MPG due to the efficiency gains of electric drive systems. I have to wonder why we’re jumping through hoops to slow the decrease of the fuel efficiency of today’s vehicles when we seemed to have had it better figured out 20 years ago. Hybrids offer baby steps in terms of technology, efficiency, and marketing efforts, falling short on real potential for large scale reduction in gasoline consumption. New technologies like advanced batteries, along with ultra light weight and very strong carbon fiber body parts are waiting in the wings for manufacturer, marketing, and consumer acceptance. Mass transportation infrastructure, such as light-rail, could be built that would likely offer greater safety and minimal disruption in convenience if we put our money towards public—rather than private—investments in transportation strategies.

Social Marketing

The 15-percent lifetime return on the investment of the average hybrid car is better than no return, but why is it that when we talk about anything related to energy efficiency our first question is “what’s the payback?” Everything costs something and few products actually increase in value or offer any sort of payback at all, but we buy them anyway because they make us feel good. We are social creatures and we like to display. A leather couch, a music CD, granite counter tops, cars; they tell those who pass through or share our lives something about who we are without words. Hybrid owners aren’t necessarily number crunchers, and there are many reasons to buy a car other than economy and payback. Consider that the hybrid fleet sold in 2006 represents over 2.6 million tons of lifetime CO2 reduction compared to their non-hybrid siblings. And this desire to be seen as socially aware and “green” is at the top of the list of why people buy hybrids.

Given the effects of this “social marketing” that has propelled sales, I’m not convinced that we need tax credits to promote hybrid vehicles. There were tax deductions for hybrids in 2004 and 2005, while 2006 was the first year that tax credits were introduced and the first year in the past six that the growth in hybrid sales actually slowed. Cost and incentives don’t seem to weigh high on the list of why people buy hybrids, so I suspect that we have a high “free-ridership” rate (those who would have bought a hybrid even if no incentives were offered).

As for other clean transportation technologies, the potential is huge. Better educated buyers are asking harder questions of sales people, and manufacturers are taking note of consumer demand. Clean diesel technology will finally be available in 2007 vehicles. A clean diesel hybrid would be exceptionally efficient, and Vermonters would surely snatch up more than a handful of efficient 4WD vehicles, but industry must first be convinced of a market. Plug-in hybrids are gaining interest, but they will contribute to electric supply load and demand problems, while increasing pollution at the power plant.

At worst, the promotion of hybrid vehicles ignores the underlying issues of real transformation required to break completely free of an oil economy. Tax credits merely offer acceptable industry green-wash and compromise to the need for efficient transportation. The American lifestyle is delivered with a sense of entitlement around personal transportation, and there is a certain irony in that most of the companies making hybrid vehicles and benefiting from sales related to US incentives are Japanese brands. At best, hybrids are a short-term stepping stone that fuel market transformation and awareness among industry and consumers that energy and transportation are extremely important issues in our times. As a passionate energy specialist and off-gridder, I offer that the only near-zero energy and carbon solution is to have an extremely efficient, all electric lifestyle using renewable energy at home and to charge up your electric car; then drive conscientiously and appropriately. And don’t stop demanding change from our leaders in politics and industry. Take energy efficiency personally and take action.

Paul Scheckel is a Senior Energy Analyst for the VT Energy Investment Corp and author of “The Home Energy Diet,” New Society Publishers, 2005.