There have been a lot of stories recently on how high diesel prices are hurting truckers. Truckers Woes The high prices especially effect independent drivers who do not have long term purchasing agreements.
Some truckers have suggested eliminating the diesel fuel tax for truckers. This idea has problems because it would leave a deficit in the transportation budget, its a one time fix (unless you want to start subsidizing diesel), and it would advantage non-truckers who use diesel.
I suggest a three part plan, however only part 1 is needed for an immediate effect:
1. Offer 50% tax credits for truck fuel efficiency upgrades. Tire auto-inflate, Aluminum wheel set, and truck aerodynamic upgrades would save the average trucker 8.6% in diesel. EPA fuel efficiency upgrades
Using the typical values of 18,000 gallons per year and 4 dollars a gallon a trucker spends $6,000 per month on diesel. These three improvements would save $516 dollar per month. The cost of the improvements $6,300 or a ROI of 12 months, the tax credits bring it down to 6 months return.
Alternatively only removing the federal diesel tax would save truckers 24 cents a gallon or 360 dollars. I'd note that the gas savings of $516 a month - ($3150/ 12) = $254 dollars savings per month slightly less savings for a trucker for one year but much more for a lifetime of the truck. The cost to the government on the other hand is $262. a month per trucker (3150/12) for one year versus $362 a year permanently by getting rid of the tax.
Further, the decrease in fuel consumption will lead to lower diesel prices for all (diesel and gasoline consumption is highly inelastic a drop of 8% fuel use per trucker would significantly alter the demand side of the equation)
There should also be a credit for heaters and/or APU which would eliminate wasteful idling (and simultaneously improve air quality). An APU can save an additional 8% in diesel fuel.
Also a one-two year federal guaranteed government loan, very low interest, may be appropriate
2. Increase the DOE budget for hydraulic hybrids. Batteries just won't work for big-rigs, the best chance is hydraulic hybrids, in local driving conditions it is estimated this could save 20-30% fuel.
3. Diesel prices are high in the winter compared to gas prices which are high in the summer. The reason, competition for the fuel. Diesel and household heating oil are very similar in composition. In the winter the northeast demands high amount of fuel oil. At a minimum there should be a concerted Federal effort/assistance to switch to high efficiency natural gas (90-96% AFUE), or even better, heat pumps (geothermal or new special designed air source heat pumps for cold climates).
U.S. consumption Diesel Fuel 4.1 Million Barrels
Northeast heating oil consumption: ~130,000 barrels per day; A conversion savings of 3% fuel which can then be used for transportation.
This conversion would also help switch the Northeast to a lower cost/more local alternative of natural gas or generated electricity.
Government study on converting Northeast to natural gas
Best regards
Some truckers have suggested eliminating the diesel fuel tax for truckers. This idea has problems because it would leave a deficit in the transportation budget, its a one time fix (unless you want to start subsidizing diesel), and it would advantage non-truckers who use diesel.
I suggest a three part plan, however only part 1 is needed for an immediate effect:
1. Offer 50% tax credits for truck fuel efficiency upgrades. Tire auto-inflate, Aluminum wheel set, and truck aerodynamic upgrades would save the average trucker 8.6% in diesel. EPA fuel efficiency upgrades
Using the typical values of 18,000 gallons per year and 4 dollars a gallon a trucker spends $6,000 per month on diesel. These three improvements would save $516 dollar per month. The cost of the improvements $6,300 or a ROI of 12 months, the tax credits bring it down to 6 months return.
Alternatively only removing the federal diesel tax would save truckers 24 cents a gallon or 360 dollars. I'd note that the gas savings of $516 a month - ($3150/ 12) = $254 dollars savings per month slightly less savings for a trucker for one year but much more for a lifetime of the truck. The cost to the government on the other hand is $262. a month per trucker (3150/12) for one year versus $362 a year permanently by getting rid of the tax.
Further, the decrease in fuel consumption will lead to lower diesel prices for all (diesel and gasoline consumption is highly inelastic a drop of 8% fuel use per trucker would significantly alter the demand side of the equation)
There should also be a credit for heaters and/or APU which would eliminate wasteful idling (and simultaneously improve air quality). An APU can save an additional 8% in diesel fuel.
Also a one-two year federal guaranteed government loan, very low interest, may be appropriate
2. Increase the DOE budget for hydraulic hybrids. Batteries just won't work for big-rigs, the best chance is hydraulic hybrids, in local driving conditions it is estimated this could save 20-30% fuel.
3. Diesel prices are high in the winter compared to gas prices which are high in the summer. The reason, competition for the fuel. Diesel and household heating oil are very similar in composition. In the winter the northeast demands high amount of fuel oil. At a minimum there should be a concerted Federal effort/assistance to switch to high efficiency natural gas (90-96% AFUE), or even better, heat pumps (geothermal or new special designed air source heat pumps for cold climates).
U.S. consumption Diesel Fuel 4.1 Million Barrels
Northeast heating oil consumption: ~130,000 barrels per day; A conversion savings of 3% fuel which can then be used for transportation.
This conversion would also help switch the Northeast to a lower cost/more local alternative of natural gas or generated electricity.
Government study on converting Northeast to natural gas
Best regards