A $4,000 Difference in the Price of a car could make a big difference for energy innovation

A year ago, President Donald Trump announced the U.S. would leave the Paris climate accord that was signed by 195 nations in the hopes of reducing greenhouse gas emissions to combat climate change. That…

A $4,000 Difference in the Price of a car could make a big difference for energy innovation

A year ago, President Donald Trump announced the U.S. would leave the Paris climate accord that was signed by 195 nations in the hopes of reducing greenhouse gas emissions to combat climate change. That decision has turned out to be bad news for national security and the future of our children. If we want to develop a bright future, we need to find ways to help reduce the greenhouse gas emissions that are already increasing the effects of climate change.

One route is through technological innovation. One example is improving the efficiency of light bulbs. Research shows that incandescent bulbs that are 13 to 15 percent more efficient produce 73 percent more energy than traditional incandescent bulbs. This means that electricity bill can be cut by about $2 a month. That is approximately $70 a year for the average American household. The key factor in developing electric cars is improving the efficiency of light bulbs that make use of energy in the form of light. While retuning our light bulbs could save the economy billions, we need to also invest in developing better batteries that could provide energy storage for charging electric cars.

The most recent statistic released by The Price of Electric Cars is that there are 285,000 electric cars and 667,000 plug-in hybrids on the road. But this number is largely based on state incentives that are mostly based on the cost of the vehicle not the actual cost of charging the vehicle. According to the Center for Energy Efficiency and Renewable Technologies, the total cost of ownership for a vehicle that has a battery that stores energy from the driver’s travels and store energy in the form of a motor is around $10,000. This is roughly $8,000 for the motor and the remaining $2,000 for the battery, with consumers paying $25 per month. This means the actual cost of ownership of an electric car will be around $14,000. But this $4,000 difference over the vehicle’s estimated cost will only be realized if we move away from fossil fuels and make this move. Many of these cars are used to drive to the home to plug in to charge, not to travel.

It should be expected that developing a battery that stores energy in the form of a motor will be more expensive than the traditional materials used to create them. However, if the batteries are very compact and efficient, we could reduce the overall cost of developing electric cars in the long run.

Tax changes, reductions in personal expenses and other changes to the tax code could also be a good way to encourage the purchase of electric cars. If $1 gasoline at the pump was enough to motivate a person to purchase a car that would be better for the environment, then by doing the same for a person who uses an electric car, we would actually be encouraging the use of electric cars. A tax of 40 cents per gallon on gasoline could encourage someone to purchase an electric car. In the U.S., there are a few states, such as New York, with a state income tax that is no longer transferable to a child. This would encourage a parent to purchase an electric car for their child rather than the traditional gas-guzzling vehicle.

A tax on gasoline could also motivate the purchase of electric cars at the expense of alternative vehicles that currently outsell electric cars by a wide margin. Of course, to motivate the purchase of an electric car in the long run, we would have to offset the increased cost of an electric car by taxing oil companies, whose profits are skyrocketing because of the fact that oil prices are declining.

According to the Energy Information Administration, oil demand is increasing and there is no sign of demand leveling off. So in the short term, making oil more expensive will encourage the purchase of less expensive, less efficient transportation options.

With increased gasoline prices, the move to electric cars could actually make some sense. However, the question is, how much of an increase in gasoline prices will the cost of an electric car actually increase? The question of how much an electric car will actually cost is going to be important. Getting rid of energy from fossil fuels could save the economy billions in energy costs, but it will take more time, until electric cars become mainstream and then, make them more affordable. The question of the cost of electric cars is a very complicated one. If we continue to subsidize energy in the form of gasoline and not energy in the form of solar panels, we will have an even more difficult time getting rid of this resource. We must not allow any other type of energy to be subsidized. This could be one of the biggest hurdles to achieving our climate goals.

Paul Blalock is a strategic adviser at Max Planck Institute for Chemistry and the author of ‘The Great Conglomerate and Its Fight with Nature’ and ‘The Matrix of the Market.’

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