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The cost-effectiveness of methanol for reducing motor vehicle emissions and urban ozone

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  • Alan J. Krupnick
  • Margaret A. Walls

Abstract

This article analyzes the costs and emissions characteristics of methanol vehicles. The cost-effectiveness of methanol-the cost per ton of reactive hydrocarbon emissions reduced-is calculated and compared to the cost-effectiveness of other hydrocarbon reduction strategies. Methanol is found to cost from $33,000 to nearly $60,000 per ton, while several other options are available for under $10,000 per ton. The cost per part-per-million reduction in peak ambient ozone levels is also computed for two cities, Houston and Philadelphia. Despite the greater improvement in ozone in Philadelphia than Houston, methanol is found to be more cost-effective in Houston. This result occurs because Houston's distribution and marketing costs are lower than Philadelphia's. The costs in both cities, however, are far higher than estimates of the benefits from acute health improvements. Finally, the reduction in ozone exposure in Los Angeles is estimated and the costs of the reduction compared with an estimate of acute health benefits. Again, the benefits fall far short of the costs.

Suggested Citation

  • Alan J. Krupnick & Margaret A. Walls, 1992. "The cost-effectiveness of methanol for reducing motor vehicle emissions and urban ozone," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 11(3), pages 373-396.
    • Handle: RePEc:wly:jpamgt:v:11:y:1992:i:3:p:373-396
    DOI: 10.2307/3325068
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    References listed on IDEAS

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    1. ARTHUR FRAAS & ALBERT McGARTLAND, 1990. "Alternative Fuels For Pollution Control: An Empirical Evaluation Of Benefits And Costs," Contemporary Economic Policy, Western Economic Association International, vol. 8(1), pages 62-74, January.
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    Cited by:

    1. Ian W. H. Parry & Margaret Walls & Winston Harrington, 2007. "Automobile Externalities and Policies," Journal of Economic Literature, American Economic Association, vol. 45(2), pages 373-399, June.
    2. Fullerton, Don & West, Sarah E., 2002. "Can Taxes on Cars and on Gasoline Mimic an Unavailable Tax on Emissions?," Journal of Environmental Economics and Management, Elsevier, vol. 43(1), pages 135-157, January.
    3. Schleiniger, Reto, 1999. "Comprehensive cost-effectiveness analysis of measures to reduce nitrogen emissions in Switzerland," Ecological Economics, Elsevier, vol. 30(1), pages 147-159, July.
    4. Wang, Michael Q., 2004. "Examining cost effectiveness of mobile source emission control measures," Transport Policy, Elsevier, vol. 11(2), pages 155-169, April.
    5. Dowlatabadi, Hadi & Lave, Lester B & Russell, Armistead G, 1996. "A free lunch at higher CAFE? A review of economic, environmental and social benefits," Energy Policy, Elsevier, vol. 24(3), pages 253-264, March.
    6. Linda Fernandez, 2005. "The Case For Cross‐Media Environmental Policy," Contemporary Economic Policy, Western Economic Association International, vol. 23(4), pages 555-567, October.

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