Green is Great as Long as You Do Not Have to Pay


Surprise, surprise! Going “green” is just fine as long as it doesn’t impact your wallet. That’s one of the findings of the Public Policy Institute of California, based on a broad-reaching opinion poll of Golden State consumers, arguably the most environmentally aware consumers in the nation.


According to PPIC’s president, Mark Baldassare, “The belief in climate change and support for state and federal action in climate change remains very strong in California today.” Dig a little deeper in the study’s findings, however, and you can detect a few caveats.


Asked if state and federal governments should require oil companies to produce transportation fuels with lower emissions, more than three-quarters of Californians – 76% – said yes. But of those who answered positively, only 37% favored this move if it would mean an increase in gasoline prices. A similar split occurred when asked about requiring a large portion of California’s electricity to come from renewable energy sources.


It seems that “green” in the abstract is far more appealing than a green reality of potentially higher costs.


Desire vs. Costs

Let’s bring this idea into focus with fuel-efficient cars. A recent study of U.S. drivers by Penn, Schoen and Berland Associates LLC found that 74% of respondents would consider buying a hybrid-electric or plug-in hybrid vehicle.


And yet last year, pure electric and plug-in hybrid vehicles accounted for only 0.6% of total new-car sales. Even traditional hybrids made up only 490,000 of the 15.6 million vehicles sold in 2013.


Future Increases

Honda FCEV ConceptJust last month, a Consumer Federation of America survey reported that 83% of respondents support the federal government’s Corporate Average Fuel Economy (CAFE) standards calling for the equivalent of a 54.5-mpg average by 2025.


But costs were not factored into the survey questions.


These 2025 CAFE standards should result in average incremental cost increases of $1,540, according to the federal government. By another estimate, from engineering firm AVL Group, that figure could be $2,566. The AVL Group analysis also noted a big disparity among different types of vehicles. For full-size light-duty trucks, for example, they estimate that costs could jump by $4,542.


Impact on Car Sales

Calculators and moneyGreen usually costs more, even though it can save money in the long run. Just how far-sighted the buying public will be when faced with increasingly expensive green vehicles remains to be seen.


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