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Print 81 comment(s) - last by freedom4556.. on Aug 27 at 5:30 PM


  (Source: blogspot.com)
VW wants more incentives

Volkswagen AG (VW) wants diesel vehicles to get federal and state incentives similar to those for electric vehicles (EVs). Instead, the automaker feels diesels are "penalized." 

“We’re not feeling the love,” said Anna Schneider, vice president for industry and government relations at VW Group of America. “This is one of the greenest choices... It’s time the U.S. government included clean diesel in its ‘all of the above’ strategy’ for greening U.S. roads. Putting these vehicles on the road should be incentivized and not penalized, and that’s our goal.”

Diesels are about 30 percent more fuel efficient than gasoline vehicles, but the problem is that diesels have a higher carbon content than the gasoline-powered cars. For that reason, the U.S. Environmental Protection Agency (EPA) said that diesels only cut carbon emissions by 7 to 20 percent.

Hence, diesels don't get the same treatment as EVs. EVs receive many advantages, such as federal and state tax credits, access to carpool lanes, etc. This is because EVs are seen as key contributors to "greening" the auto industry, and that's especially important right now with the new 54.5 MPG CAFE standards in place for 2017-2025 model years. 

In fact, these new standards don't give diesels additional credits the way it does other vehicles. The EPA said it doesn’t believe diesel vehicles push the commercialization of technologies that will help autos reach zero (or even near-zero) emissions. In addition, the EPA doesn't seem to think that diesels have an issue with "consumer acceptance."

Further hurting the cause of diesels is that 15 U.S. states place additional taxes on diesel, and federal taxes for diesels are 6 cents higher than those of gasoline-powered autos. 

EVs, on the other hand, are eligible for a $7,500 federal tax credit. 

VW is a known promoter of diesel vehicles. For instance, the company confirmed its XL1 hybrid for production earlier this year. The two-seat Volkswagen XL1 has a plug-in diesel hybrid system that allows it to achieve 314 MPG and 31 miles on electric power alone. The CO2 emissions sits at 21 g/km, and it is considered the most aerodynamic car with a Cd figure of 0.189. It's also very light at just 1,752 pounds.


Source: The Detroit News



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RE: Whole 6 cents?
By spamreader1 on 8/22/2013 11:38:13 AM , Rating: 2
Well that's 6 cents per/gallon after purchase penalty for driving a more fuel effecient vehicle. I think that's what the purpose of that statement really meant anyway.

If the extra taxes were removed it would place the cost of diesel fuel in the US roughly on par with mid grade gasoline, intead of being roughly the same price on premium grade gasoline.

Until the ULSD standards were put in place on diesel, it used to be cheaper per gallon than low grade gasoline.


RE: Whole 6 cents?
By wolrah on 8/22/2013 1:30:16 PM , Rating: 2
quote:
Until the ULSD standards were put in place on diesel, it used to be cheaper per gallon than low grade gasoline.


Diesel prices here in Ohio went up to roughly match 93 octane back in '04 or so, then ever since seem to have followed 93 on increases but usually doesn't fall back off nearly as fast.

ULSD didn't hit until '07 or so, even California hadn't mandated it until '06, so I can't see a relation there.

The fuel companies simply know that most gasoline vehicle owners can just scale back their driving as prices go up, where most diesels are commercial vehicles which need to be rolling to make money. Diesel drivers as a whole thus are less capable of "voting with their wallet". If we had a greater share of passenger vehicles with diesel power I guarantee the pricing would fluctuate more in line with lower grades of gasoline like it used to.


RE: Whole 6 cents?
By spamreader1 on 8/22/2013 2:23:01 PM , Rating: 2
Well in July 2006, sorry I can't seem to find August 2006 national average prices.
Gasoline
$3.15
Diesel
$2.93
ULSD started Sept. 2006 in most US states, I think Alaska was exempt for some time, if I remember right.
Granted ULSD is not the only thing that affects diesel prices, also note that some areas of the country use a similar fuel for home heating that co-insides with diesel prices.

It is definately a factor, albeit one of several. I just personally noticed that myself in purchaing diesel for my hobby farm use, that the price rose quite a bit at the same time as the formulation change, and never really went back to it's orignal pricing compared with gasoline.


RE: Whole 6 cents?
By Monkey's Uncle on 8/22/2013 6:31:37 PM , Rating: 3
Diesel and gasoline are commodities. When demand is high and supply low, prices rise. When demand is low and supply is high, prices fall.

Public buying is fickle. Gasoline is a much more dynamic market since there is a higher public demand on it. Diesel is used mostly in commerce and industry which is usually has rpetty steady requirements. Thus you don't see diesel prices fluctuate quite so widely as gasoline.

When Diesels become more popular in North America, you will see Diesel prices behaving more and more like gasoline. You will also see prices rise higher than gasoline as higher demand on Diesel starts overtaking gasoline and gasoline becomes less popular (resulting in higher supplies in that need to be stored).


RE: Whole 6 cents?
By JediJeb on 8/23/2013 4:03:30 PM , Rating: 2
quote:
Diesel and gasoline are commodities. When demand is high and supply low, prices rise. When demand is low and supply is high, prices fall.


The only problem with that is that the oil producers like to tweak supply so that it is always in line with demand so that prices stay high.


RE: Whole 6 cents?
By Monkey's Uncle on 8/23/2013 4:42:32 PM , Rating: 2
You can only tweak supply just so much before you have undesired consequences.

When you consider that both gasoline and diesel from the same barrel of crude, attempting to reduce the supply of gas will also have an undesired effect of reducing the supply of diesel. They are tightly interrelated. Yes, refiners can tweak the amounts of each produced during crude distillation, but the fact is that they are both produced at the same time. So if you want to reduce the supply of gas, but not diesel, what do you do with the gas that will be produced anyway? Selling it would be the smart thing to do and to sell it, you will need to price it lower to attract demand.

Economics 101.


RE: Whole 6 cents?
By Solandri on 8/23/2013 2:12:54 PM , Rating: 2
quote:
The fuel companies simply know that most gasoline vehicle owners can just scale back their driving as prices go up, where most diesels are commercial vehicles which need to be rolling to make money. Diesel drivers as a whole thus are less capable of "voting with their wallet".

Diesel is more constrained than gasoline. You can alter the oil refining process to create more gasoline than diesel (basically break up some of the longer molecules to create shorter ones). You can do the reverse too (create more diesel than gasoline), but it's a lot harder and more expensive. It's easier to break stuff than it is to glue it together.

So the amount of gasoline that's produced can be (somewhat) easily scaled with demand. The amount of diesel not so much.


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