Gas prices are a ‘double-edged sword’ that hurts drivers and helps the climate | business news

By SETH BORENSTEIN and TOM KRISHER Associated Press

As Congress and now the Supreme Court stymie the Biden administration’s efforts to curb climate change, one thing the president doesn’t want — skyrocketing gasoline prices — is actually to cut emissions of heat-trapping gases.

Gasoline prices across much of the United States topped the $5-a-gallon mark last month before falling slightly, and Americans have responded by driving slightly less, two sets of data show. June gas sales are 5% below pre-2019 pandemic levels and 2.6% below a year ago, according to the US Energy Information Administration.

Americans in April, the last month for which data was available, drove 6% fewer miles than in the same month in 2019, according to transportation analyst Michael Sivak, a former University of Michigan professor who tracks long-standing car-buying and driving habits. . That 6% drop is small compared to the 40% drop in driving miles in April 2020 when the pandemic began.

However, a 6% drop in driving roughly translates to a 1% drop in total US carbon emissions, Sivak said. The US climate goal is to cut carbon emissions in half by 2030 compared to 2005 levels.

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“High fuel prices are a really difficult thing because they’re a double-edged sword,” said Samantha Gross, director of the climate and energy security initiative at the centrist Brookings Institution. “So prices that are high and are expected to stay that way have a longer-term ability to reduce demand and I guess the administration wouldn’t mind seeing that, but the problem is people hate it.”

High gasoline prices are “unequivocally” good for combating climate change because people use fewer fossil fuels and emissions go down, but poorer people, who have no other options, also “suffer more,” climate economist said Solomon Hsiang, director of the Climate Impact Laboratory at the University of California, Berkeley. Carbon emissions are causing harm, especially to future generations, but for decades cheap gasoline has meant “no one is paying for that harm,” he said.

Now people pay more when they go to the gas station and some are changing their habits.

Richard Gowan, 56, of Brighton, Michigan, used to commute 26 miles to his job in Ann Arbor twice a week in a 2021 Ford F-150 pickup. But with gas hovering around $5 a gallon, he has cut back on a quarter of truck trips. “That one doesn’t come out of the driveway as much as it used to,” he said as he pumped gas near work.

To save money, he’s replaced a small Jeep Renegade SUV, which gets substantially better fuel economy than the 24 miles per gallon he gets with the pickup, which he bought to tow a travel trailer. The towing is still going on because he doesn’t want to give up family vacations, Gowan said.

He blamed the high gas prices on the policies of President Joe Biden. He wants Biden to drill more and predicts that engineering will eventually solve climate change.

In San Diego, where gas costs more than $6 a gallon, Simmi Paul said her family has also cut back on driving. Her daughter, a college student, now walks 10 minutes to work and takes public transportation to school instead of driving.

Even though the Fourth of July holiday weekend saw a record number of people on the road, they weren’t driving that far “because they can’t afford the cost of gas,” said Devin Gladden, a spokesman for the American Automobile Association. People who must drive, he said, “are trying to find ways to combine some of their errands or maybe if they can carpool to work, they are finding ways to reduce the amount of gas they have to buy and put in their vehicles.”

Biden has frequently said he doesn’t want high gas prices, attacked oil companies’ multibillion-dollar profits, proposed new offshore oil and gas drilling despite campaign promises, and proposed a gas tax exemption, that congressional leaders said won’t work. Asked if conservation should play a bigger role in adjusting to high prices, White House press secretary Karine Jean-Pierre said, “Americans will do what they think is right for themselves and their families.” . That’s not something we can make a judgment about.”

Biden confidants know that high gas prices hurt people and the president politically.

“The fact is there have been a lot of studies on this, it’s just psychologically that the way people tend to look at the economy is through inflation,” said John Anzalone, a Democratic pollster who has worked for Biden. “People tend to focus on weak points.”

Watch the pump for the sore spot.

That’s about $200 a week for Pat Blevins, 42, a carpenter from Waterville, Ohio, who was filling up his 2016 Chevrolet Silverado at a gas station west of Toledo, Ohio on Tuesday. “He likes to eat gasoline,” he said of his truck, which he says gets about 15 miles per gallon.

When gasoline hit $4 a gallon in the summer of 2008, American car buyers quickly switched from full-size trucks and SUVs to smaller, more efficient vehicles. But when it hit that level again in early March, there was little impact on new-vehicle sales in the US, where about three-quarters of vehicles sold are SUVs and trucks.

“Even at $5 a gallon, it’s hard to find evidence of changing habits” and buying smaller cars that use less gas, said Jeff Schuster, president of global forecasting at consultancy LMC Automotive.

In part it is due to a worldwide shortage of computer chips. Automakers have been shipping the chips they receive to factories that build larger, more profitable vehicles, Schuster said.

Still, if smaller cars and SUVs were more widely available, Schuster says he’s confident people would buy them.

Blevins said he will consider the new electric Silverado to replace his gas model “if it’s worth the expense and if it can run like a gas can.”

Sivak believes that $5 a gallon for gasoline is the price that changes Americans’ driving habits for now, still far lower than the price paid in Europe and much of the rest of the world.

“When you talk about the real results of the energy transition (towards lower carbon pollution), some of this means that things are going to get more expensive and that we need to find better solutions about how we finance and make sure that everyone can participate in the energy transition and it’s not just for the wealthy or privileged few,” said AAA’s Gladden.

Some economists, such as Hsiang, have called for a carbon tax of 25 cents to 50 cents per gallon above the market price “to address climate change damage” and reduce carbon pollution by reducing demand, but with profits in part returned to people and part used for green energy projects. But at the same time, he said, “higher gas prices hurt poorer families the most,” so the government should send them financial aid but not subsidize cheap gas.

Biden’s proposed gas tax exemption “is a subsidy, you’re paying people to pollute,” Hsiang said.

Gross of Brookings said Republicans falsely blame Biden for the gasoline shortage because he canceled a pipeline that has little to do with gas prices. She said the global surge in gas prices is mainly due to pent-up demand following the pandemic and supply problems and the Ukraine war.

“I really feel sorry for Biden because he’s in this situation where he wants to do climate stuff and his base is like ‘yeah, we want climate stuff’ and he supported it and I think he feels it personally,” Gross said. “But he’s in this situation where he’s getting hit by high gas prices.”

Borenstein reported from Washington, Krisher from Ann Arbor, Michigan. Josh Boak and Matthew Daly contributed from Washington.

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