The opposing argument made by Sain ley Berry, that the only thing that will work is an increase in the cost of fuel, is exactly wrong. Driving (not the same as fuel consumption) is highly price-inelastic. An increase in fuel prices will mainly be useful to get people to change to fuel-efficient cars, not to get them to drive less. Unless you start talking about price increases of 100% and above. Now, I would like those. I would also like a pony.
... is that a direct excise on new car prices that is keyed to fuel efficiency will have the same main impact as an increase in fuel price ... and do it out of the pockets of the higher-income people of the community who typically buy new cars ... while down the track increasing the supply of more fuel efficient car available to the lower-income people in the community who typically buy used cars.
Set the fuel waste excise at "X"% with a three-tier schedule ... that is, double the excise ... 2X% ... for cars that are twice the fuel inefficiency of the current fleet, and a 0% fuel inefficiency excise excise on cars that half or less of the fuel inefficiency of the current fleet.
The receipts go straight into a pool of funds for local communities to invest in energy-saving transport infrastructure. I've been accused of being a Marxist, yet while Harpo's my favourite, it's Groucho I'm always quoting. Odd, that.
Coming to the technicalities of your measure, very few cars have double the fuel efficiency of the fleet and very few have half. So you'd want more tiers in the schedule. Something like 8 should do.
Taking CO2 emissions, the Porsche Cayenne entry model, for instance, has 310 grammes of CO2 emissions per kilometre, which is less than double the emissions of the EU average (about 160). There are no new cars that emit 80 grammes. The most efficient new car now, the Toyota Aygo/Peugot 107/Citroen C1 model, emits 109 grammes.
80 should be possible if you make those hybrids; the Honda Insight emitted 80 grammes according to Honda (probably a bit optimistic, but it was a larger car).
- Jake If you only spend 20 minutes of the rest of your life on economics, go spend them here.
