Replacing Gasoline: Alternative Fuels For Light-Duty Vehicles

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Replacing Gasoline: Alternative Fuels forLight-Duty VehiclesSeptember 1990OTA-E-364NTIS order #PB91-104901

Recommended Citation:U.S. Congress, Office of Technology Assessment, Replacing Gasoline: Alternative Fuels forLight-Duty Vehicles, OTA-E-364 (Washington, DC: U.S. Government Printing Office,September 1990).For sale by the Superintendent of DocumentsU.S. Government Printing Office, Washington, DC 20402-9325(order form can be found in the back of this report)

ForewordAmong the several major issues that Congress has addressed in the process ofreauthorizing the Clean Air Act, the future role of alternative highway transportation fuels inreducing urban smog is one of the more prone to argument. Past attempts to reduce pollutionlevels from highway vehicles have focused primarily on the vehicles themselves; adjustmentsto fuels were considered mainly when these were necessary to allow vehicular controls to work(eliminating lead from gasoline was necessary to avoid poisoning the catalytic converters onthe vehicles). As vehicular emissions control efficiencies rose past 90 percent and furtherimprovements became more difficult, however, attention turned to the idea that somealternatives to gasoline have combustion and/or other physical and chemical properties thatmight allow the achievement of ultra-low emissions levels. The fuels of interest includemethanol (wood alcohol), ethanol (grain alcohol), natural gas, electricity, and hydrogen.In this report, requested by the House Committee on Energy and Commerce and theSenate Committee on Energy and Natural Resources, which is part of OTA’s ongoingassessment of Technological Risks and Opportunities in Future U.S. Energy Supply andDemand, OTA gives a broad overview of the qualities of the competing fuels and examinesin depth some of the most contentious issues associated with the wisdom of active Federalsupport for introducing the fuels. Areas of uncertainty that affect the debate on Federal supportinclude fuel cost (including costs of building new infrastructure and modifying vehicles); theair quality effects of the new fuels; effects on energy security; other environmental impactsof the fuels; and consumer acceptance of the changes in vehicle performance, refuelingprocedures, costs, and other facets of the transportation system that would follow a large-scaleintroduction of any of the fuels. The report singles out for special examination t h e a r g u m e n t sconcerning the costs, energy security implications, and air quality impacts of introducingmethanol fuels into the fleet. However, the other fuels have similar levels of uncertainty andcontentiousness.As this report goes to press, the oil-driven crisis in the Middle East mounts daily andcould erupt at any time into major conflict. Alternative fuels will play a minor-to-negligiblerole in near-term responses to that situation, because the time required to make fundamentalchanges in our energy supply and demand require years, if not decades. In the longer term,however, if the United States desires to take advantage of the opportunities with alternativefuels to reduce the likelihood and impacts of future such events of armed conflict or tocapitalize on the potential substantial environmental advantages inherent in these fuels, wemust adopt a sensible, long-term national investment commitment to effect those changes.wDirector

Replacing Gasoline: Alternative Fuels for Light-Duty Vehicles—Advisory PanelJohn Sampson Toll, ChairmanUniversity of MarylandJames H. Caldwell, Jr.ARCO Solar, Inc.Edwin RothschildCitizen/Labor Energy CoalitionDaniel A. DreyfusGas Research InstituteMilton RussellUniversity of TennesseeFrederick J. EllertGeneral Electric Co.Maxine SavitzGarrett CeramicDavid R. JohnsDavid R. Johns Real Estate GroupCharles A. BergNortheastern UniversityDavid Lee KulpFord Motor Co.Robert WallacePeabody Holding Co.Jessica MathewsWorld Resources InstituteJack W. WilkinsonEdward H. MergensShell Oil Co.Robert WilliamsPrinceton UniversityNathan RosenbergStanford UniversityMason WillrichPacific Gas and Electric Co.sun co., Inc.NOTE: OTA appreciates and is grateful for the valuable assistance and thoughtful critiques provided by the advisory panel members.The panel does not, however, necessarily approve, disapprove, or endorse this report. OTA assumes full responsibility for thereport and the accuracy of its contents.iv

OTA Project Staff—Replacing Gasoline: Alternative Fuels forLight-Duty VehiclesLionel S. Johns, Assistant Director, OTAEnergy, Materials, and International Security DivisionPeter D. Blair, Energy and Materials Program ManagerProject StaffSteven E. Plotkin, Project DirectorAdministrative StaffTina BrumfieldLillian ChapmanLinda LongContributorsRosina Bierbaum, OTA Oceans and Environment ProgramRobert M. Friedman, OTA Oceans and Environment ProgramJana B. Milford, University of ConnecticutContractorEnergy & Environmental Analysis, Inc., Arlington, VA

ReviewersDavid GreeneOak Ridge National LaboratoryJerrold L. LevineAmoco oil co.Mark DeLuchiUniversity of California, DavisTerry ReunerAmoco oil co.Daniel SperlingUniversity of California, DavisThomas J. LareauAmerican Petroleum InstituteJames MackenzieWorld Resources InstituteAlan C. LloydSouth Coast Air Quality Management DistrictEdward H. MergensShell Oil Co.Michael KellyJensen Associates, Inc.David Lee KulpFord Motor Co.Christopher FlavinWorldwatch InstituteEugene Eklund12907 Asbury DriveNicholas LenssenWorldwatch InstituteDave GusheeLibrary of CongressJohn YoungWorldwatch InstituteDaniel J. TownsendARCO Products Co.Harry SchwochertGeneral Motors Corp.Michael JacksonAcurex Corp.Margaret A. WallsResources for the FutureCarl MoyerAcurex Corp.Robert WilliamsPrinceton UniversityWilliam J. SchumacherSRI InternationalJoan OgdenPrinceton UniversityDixon SmithChevron U.S.A. Inc.Brad HollomanNew York State Energy Research and DevelopmentAuthorityBruce BeyaertChevron U.S.A. Inc.Paul HoltbergGas Research InstituteCharles L. Gray, Jr.U.S. Environmental Protection AgencyPhil LorangU.S. Environmental Protection AgencyJulie HaydenU.S. Environmental Protection AgencyRobert BruetschU.S. Environmental Protection AgencyJ. Dillard MurrellU.S. Environmental Protection AgencyDavid BartusU.S. Environmental Protection AgencyRobert P. Howell19 Elkin CourtviEric VaughanRenewable Fuel AssociationGordon AllardyceChrysler MotorsBarbara GoodmanSolar Energy Research InstituteTom CacketteCalifornia Air Resources BoardJana MilfordUniversity of ConnecticutK.G. DuleepEnergy and Environmental Analysis, Inc.Thomas BullFood and Drug AdministrationGlyn ShortICI General Chemicals

ContentsPageExecutive Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1OVERVIEW . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1Meeting Society’s Goals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3Other Key Issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4SUMMARY AND CONCLUSIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4The Perceived Benefits of Alternative Fuels . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6Introducing Alternative Fuels Into the Light Duty Fleet . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1123Chapter I. Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Chapter 2. Why Support Alternative Fuels? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31OZONE CONTROL IN PERSPECTIVE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31Why Control Ozone? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .32Ozone and Its Precursors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33Controlling Volatile Organic Compounds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34Controlling Nitrogen Oxides . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40The Role of Alternative Fuels . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40ENERGY SECURITY IN PERSPECTIVE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42Should Energy Security Be a Major Concern for U.S. Policymakers? . . . . . . . . . . . . . . . . . . . . . . . . . 42Energy Security Effects of Alternative Fuels . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48THE GREENHOUSE EFFECT IN PERSPECTIVE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49Key Uncertainties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50Benchmarkarming: The Effect of Doubled Cob . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53Reducing C02 Emissions in the Near-Term . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53The Transportation Sector and Global Warming . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54U.S. Transportation Energy Use and CO 2 Emissions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55Alternative Fuels . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56Chapter 3. Substituting Methanol for Gasoline in the Automobile Fleet . . . . . . . . . . . . . . . . . . . . . . . 59EFFECTS 0N AIR QUALITY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60Organic Compounds and Ozone Reduction. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61Nitrogen Oxides (NOX) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69Carbon Monoxide . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69Toxic Emissions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70Greenhouse Emissions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71OTHER ENVIRONMENTAL/SAFETY EFFECTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72COST COMPETITIVENESS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .73INFRASTRUCTURE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 79ENERGY SECURITY IMPLICATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80METHANOL OUTLOOK AND TIMING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 83APPENDIX 3A: FACTORS AFFECTING METHANOLCOSTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 84Feedstock Costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 84Production Costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 87Capital Charges . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88Long-Distance Shipping . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 92Distribution Costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 92Retail Markup . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 93Methanol/Gasoline Conversion Factor . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 93Chapter 4. Natural Gas as a Vehicle Fuel . . . . . . . . .*** .****. . . . . . . . . . . . . . . . . . . . . . . . . . 97VEHICLES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 97EFFECTS ON AIR QUALITY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 99SAFETY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 101COST COMPETITIVENESS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 101SOURCES OF SUPPLY AND STRATEGIC CONSIDERATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . 102REFUELING AND INFRASTRUCTURE. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .103NATURAL GAS OUTLOOK AND TIMING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 104Chapter 5. Ethanol as a Gasoline Blending Agent or Neat Fuel in Highway Vehicles . . . . . . . . . . . 107EFFECTS ON AIR QUALITY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 107. . . . . . . . . . . . . . . . . . . . . . . . . . . .** vii

COST COMPETITIVENESS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 108ENERGY AND ENVIRONMENT’ EFFECTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 111DEMAND LIMITS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 114ETHANOL OUTLOOK AND TIMING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 114117Chapter 6. Electric Vehicles . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .VEHICLE CHARACTERISTICS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 117ADVANCED TECHNOLOGY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 118MARKET COMPETITIVENESS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 119HYBRID VEHICLES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 120INFRASTRUCTURE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 122EFFECTS ON EMISSIONS AND AIR QUALITY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 123ELECTRICITY OUTLOOK AND TIMING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 124Chapter 7. Hydrogen as a Vehicle Fuel . . . . , . . . . . . . . . . . . . . . . . . . 127FUEL SOURCE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 127VEHICLES AND FUEL STORAGE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 127EMISSIONS AND PERFORMANCE ATTRIBUTES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 128SAFETY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 128DEVELOPMENT REQUIREMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 128COST COMPETITIVENESS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 129HYDROGEN OUTLOOK AND TIMING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 130Chapter 8. Reformulated Gasoline . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 131ARCO’S "EMISSION CONTROL 1"GASOLINE. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 132REFORMULATION POTENTIAL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 132COSTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 134SECONDARY IMPACTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 136ADDITION OF OXYGENATES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 136. .0. . . . . . . . . . . BoxesBoxPageA. Alternative Transportation Fuels . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5l-A. Comparing Vehicles Fueled With Gasoline and Alternative Fuels . . . . . . . . . . . . . . . . . . . . . . . . . . . . 292-A. Greenhouse Gases . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 513-A. How Does EPA Arrive at Its Estimates for the Ozone-Reduction Impact ofMethanol Vehicles? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 626-A. GM’s Impact: A Niche Vehicle . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1218-A. What Is Reformulated Gasoline . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 149FiguresFigure.VlllPagel. Volatile Organic Compound (VOC) Emissions in Nonattainment Cities in 1994,by Source Category, After All Additional Control Methods Are Applied . . . . . . . . . . . . . . . . . . . . . .72. EIA Projections of Petroleum Supply, Consumption, and Import Requirements to 2010,Base Case . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 83. World Exportable Gas Surplus as of Dec. 31, 1987 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .94. Technical Differences Between Flexible-Fuel and Conventional Automobiles . . . . . . . . . . . . . . . . . . 125. Potential Low-Cost Suppliers of Methanol . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 146. Converting Methane to Methanol . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 177. Effect of Electricity Source on Greenhouse Impact of Electric Vehicles . . . . . . . . . . . . . . . . . . . . . . . 212-1. Acute Effects of Ozone Exposure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 332-2. Areas Classified as Nonattainment for Ozone Based on 1983-85 Data . . . . . . . . . . . . . . . . . . . . . . . . . 352-3. VOC Emissions in Nonattainment Cities, by Source Category, in 1985 . . . . . . . . . . . . . . . . . . . . . . . 3624. VOC Emissions Reductions in 1994 Compared to 1985 Emissions, by Control Method . . . . . . . . . 372-5. Summary of Estimated Nationwide Nitrogen Oxides (NOX)Emissions by Source Category,by Year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 412-6. EIA Projections of Petroleum Supply, Consumption, and Import Requirements to 2010,Base Case. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 422-7. Distribution of World Oil Reserves, 1988 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44

2-8. Current Contribution to Global Warming . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 542-9. Contribution of the Transportation Sector to CO2 Emissions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 553-I. “Relative Reactivity” (Ozone-Forming Capability) of Emissions From M85-Fueled Vehicles v.Gasoline-Fueled Vehicles . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 663-2. Sensitivity of Relative Reactivities of M85 Emissions to Formaldehyde Emissions Levels . . . . . . . 673-3. Year 2000 Reductions in Peak l-Hour Ozone Concentrations From M85 Use . . . . . . . . . . . . . . . . . . 683A-1. Comparison of Discounted Cash Flow Rates of ReturnWith Capital Charges Based on aPercentage of Total Fixed Investment Plus Working Capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 895-1. Process Diagram for th e production of Fuel Ethanol From Grain . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1116-1. Effect of Electricity Source on Greenhouse Impact of Electric Vehicles . . . . . . . . . . . . . . . . . . . . . . . 130TablesTablePagel. Pros and Cons of Alternative Fuels . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22. Two Scenarios for Methanol Costs, /Gallon . . . o. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 163. Environmental Impacts of Agriculture . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18l-l. Major Users of Alternative Fuels . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 242-l. Options for Amending the Clean Air Act: Currently Available Control Methods . . . . . . . . . . . . . . . 382-2. Options for Amending the Clean Air Act: New Directions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 393-1. Organic Emissions Levels for Gasoline and Methanol-Fueled Vehicles . . . . . . . . . . . . . . . . . . . . . . . . 643-2. Component and Total Methanol Supply Costs During a Transition Phase . . . . . . . . . . . . . . . . . . . . . . 753-3. Component and Total Methanol Supply Costs in unestablished Market Environment ., . . 763-4. Market Shares of Oil and Gas Production and Reserves by Region in 1985 . . . . . . . . . . . . . . . . . . . . 813-5. Proved Gas Reserves and Exportable Surpluses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 823A-l. Estimated 1987 Gas Costs and prices . . . . . . . . . . . . . . . . . ., . . . . . . . . . . . . . . . . 865-l. Environmental Impacts of Agriculture . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1115-2. Potential Environmental Effects of Logging and Forestry . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 114ix

Related OTA Reports. Catching Our Breath: Next Steps for Reducing Urban Ozone. Focuses on thehealth-based air quality standards for ozone; addresses the problem of regionaloxidants; evaluates the cost-effectiveness of controlling various sources of hydrocarbon emissions for lowering ozone levels. 0-412, 7/89; 252 p.GPO stock #052-003-01158-l; 10.00NTIS order #PB 90-130 451/AS. U.S. Oil Production: The Effect of Low Oil Prices--Special Report. Examinesissues that influence the future direction of U.S. oil production. These issues include:the expected profitability of new investments in drilling; the potential of new oilexploration, development, and production technologies; the nature of the remaining oilresource base; and structural changes in the oil industry. E-348, 9/87; 144 p.NTIS order #PB 88-142484. U.S. Natural Gas Availability: Gas Supply Through the Year 2000. Analyzes thekey technical and physical parameters that deter-n-ine the resource base, productionrates, and costs of all categories of below-ground natural gas; critically reviews currentestimates of the resource base, estimates the potential production rates of natural gas,and the uncertainties in these estimates; and assesses future technology trends andR&D needs that may accelerate these trends. E-245, 2/85; 260 p.NTIS order #PB 86-109 162/AS. U.S. Vulnerability to an Oil Import Curtailment: The Oil Replacement Capability.Provides an analysis of the technical potential for replacing large quantities of oil inthe United States over a 5-year period by fuel substitution and conservation in the eventof an extended oil supply shortfall and price rise; analyzes the macro-economicconsequences of the shortfall and various rates of oil replacement by the technologies.E-243, 9/84; 160 p.NTIS order #PB 85-127 785/ASNOTE: Reports are available from the U.S. Government Printing Office, Superintendent of Documents,Washington, DC 20402-9325 (202) 783-3238; and the National Technical Information Service, 5285 PortRoyal Road, Springfield, VA 22161-0001 (703) 487-4650.

Executive SummaryRecent interest in alternative fuels for light-dutyhighway vehicles (automobiles and light trucks) isbased on their potential to address three importantsocietal problems: unhealthy levels of ozone inmajor urban areas; growing U.S. dependence onimported petroleum; and rising emissions of carbondioxide and other greenhouse gases. This assessm e n t examines the following alternative fuels:methanol, ethanol, natural gas (in either compressed(CNG) or liquid (LNG) form), electricity (to driveelectric vehicles (EVs)), hydrogen, and reformulatedgasoline.als requirements, feedstock requirements, and soforth. The variety of effects, coupled with theexistence of the three separate “policy drivers” forintroducing alternative fuels, create a complex set oftrade-offs for policymakers to weigh. Further, thereare temporal trade-offs: decisions made now aboutpromoting short-term fuel options will affect therange of options open to future policymakers, e.g.,by emplacing new infrastructure that is more or lessadaptable to future fuel options, or by easingpressure on oil markets and reducing pressure fordevelopment of nonfossil alternative fuels. Table 1presents some of the trade-offs among the alternativefuels relative to gasoline.Substituting another fuel for gasoline affects theentire fuel cycle, with impacts not only on vehicularperformance but on fuel handling and safety, materi-Much is known about these fuels from their use incommerce and some vehicular experience. Muchremains to be learned, however, especially aboutOVERVIEWPhoto credtt General Motors Corp.GM’s Impact electric vehicle, though a prototype requiring much additional testing and development, represents a promisingdirection for alternative fuel vehicles: a “ground up,” innovative design focused on the unique requirements of the fuel sources,in this case electricity.–l–

2 Replacing Gasoline: Alternative Fuels for Light-Duty VehiclesTable l—Pros and Cons of Alternative FuelsDisadvantagesAdvantagesMethanol . . . . . . . . Familiar liquid fuelVehicle development relatively advancedOrganic emissions (ozone precursors) will have lowerreactivity than gasoline emissionsLower emissions of toxic pollutants, except formaldehydeEngine efficiency should be greaterAbundant natural gas feedstockLess flammable than gasolineCan be made from coal or wood (as can gasoline), thoughat higher costFlexfuel “transition” vehicle availableEthanol . . . . . . . . . . Familiar liquid fuelOrganic emissions will have lower reactivity than gasoline emissions (but higher than methanol)Lower emissions of toxic pollutantsEngine efficiency should be greaterProduced from domestic sourcesFlexfuel “transition” vehicle availableLower CO with gasohol (1 O percent ethanol blend)Enzyme-based production from wood being developedNatural Gas . . . . . . Though imported, likely North American source formoderate supply (1 mmbd or more gasoline displaced)Excellent emission characteristics except for potential ofsomewhat higher NOX emissionsGas is abundant worldwideModest greenhouse advantageCan be made from coalElectric . . . . . . . . . . Fuel is domestically produced and widely availab

Acurex Corp. Carl Moyer Acurex Corp. William J. Schumacher SRI International Dixon Smith Chevron U.S.A. Inc. Bruce Beyaert Chevron U.S.A. Inc. Paul Holtberg Gas Research Institute Charles L. Gray, Jr. U.S. Environmental Protection Agency Phil Lorang U.S. Environmental Protection Agency Julie Hayden U.S. Environmental Protection Agency Robert .

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