Canada's auto CEOs are calling for a scrappage feebate to trade in older cars and pickups. While competitors Chrysler and GM scream for survival bailouts, Ford-Toyota want the Conservative government to add to the porkbarrel so they can have a share. It would only cost taxpayers another $350 million -- CanWest 12 Feb 09. This PR was repeated uncritically by media across the country.
At a Commons committee a month later, Ford's CEO urged Ottawa to offer $3,500 each to consumers who trade in a pre-1997 vehicle for a new one. A similar feebate had boosted sales by 20% in Germany, he said. Does this mean the automakers have suddenly been converted to “green jobs”? Not exactly.
UK ecologist George Monbiot has whisked the green drapes off the scrappage scheme.
While automakers say the feebate would encourage low-emission cars, it does nothing of the sort. That was achieved by laws that came into force several years ago in the EU (and in California). The automakers would like us to pay for what they already had to do.
Nor is the feebate conditional on the type of car. You can “trade in your old Citroen C1 for a new Porsche Cayenne” and pay the extra gas guzzled with the rebate. Exxon thanks you.
Then Monbiot does the math. The test of a green subsidy is $ per carbon footprint. How much does it cost to save a tonne of carbon dioxide? (These figures are mostly estimates. Automakers hope that you never learn the exact ones. Figures for North America would differ.)A 1997 car emits about 208g/km
A 2008 car emits about 160g/km
Avoided emissions: 48g/km x 16500 km average per year = 792kg/car/year
He concludes, "Assuming that drivers are each paid £2,000, that's a cost of £2,525 for every tonne of CO2 avoided, divided by the average age of the cars on the road - 4.9 years. You'd get almost as much value for money by reclassifying £10 notes as biomass and burning them in power stations."
Green jobs? “Given that British car plants assemble only around 15% of the vehicles sold in this country, and given that the motor industry is highly automated and has vast capital costs, this subsidy is likely to be just as bad at saving jobs as it is at saving carbon. Every pound we spend on driving is a pound withheld from the alternatives, many of which (such as buses and trains) employ far more people for the same amount of money.”
The best investment? Monbiot makes another comparison. A tonne of CO2 saved under the scrappage scheme would cost about £2,525. Energy conservation: replacing incandescent lightbulbs with LEDs £80. Geothermal energy savings (probably under a “decoupling” law) would cost £3.50. That's Canadian $4452.44, $141.07 and $6.17 respectively. As a government or private investor, which scheme would you choose?
- Monbiot draws much of his data from detailed studies by McKinsey Global consultants. Last year McKinsey reported that $170b a year in world investments in energy efficiency could halve the projected growth in global energy demand by 2020. And would take us halfway to a Kyoto2 target of 450 ppm by 2050. Edison Electric CEO James Rogers in the NYTimes calls it the “fifth fuel”: “The most efficient and environmentally responsible plant you can build is the one that you don’t build.” McKinsey also says US energy efficiency could “reduce energy demand growth by the equivalent of 11m barrels of oil per day and greenhouse gas emissions by 1.3bn tonnes a year. This would cap energy demand growth and emissions at today's levels, while strengthening the economy.” Which global stimulus would you choose?
See the latest corporate blackmail from G&M's "auto pages" flack, Amory Lovins on negawatt power (aka energy conservation), Wikipedia on energy efficiency, and a summary of Thomas L Friedman, Hot Flat and Crowded: Why we need a Green Revolution and how it can renew America (New York: Farrar Strauss Giroux 2008).