Car Owners Willing To Pay More – Lack Of Fuel Stations Hinders Alternative Propulsion Technologies

In early December, the European Union passed a regulation stipulating that new cars’ CO2 emissions be lowered by 12 grams/km by 2015. Today, a stricter goal as of 2020 is already being discussed. This is a further incentive for the car industry to substitute petrol and diesel with environmentally friendly fuels. A recent study on the sustainability of alternative propulsion technologies shows how realistic this vision is. The study was conducted by the Centre of European Economic Research (ZEW), Mannheim, in cooperation with the Institute for Applied Traffic and Tourism Research (IVT) and the Center Automotive Research (CAR).

The study indicates that German consumers are well willing to switch to cars running on natural gas, bio fuels or, on a long-term basis, on hydrogen. A prerequisite, however, is for many more petrol stations to offer the respective fuels. The study also analysed how valuable consumers deem an extension of the fuel station infrastructure to be. These values vary significantly depending on car price and the current network of petrol stations. An extension of the network from 20 percent to 30 percent, for instance, would justify an increase in car price of 3,800 to 5,800 Euro, according to consumers (see Table 1).

Currently there are some 15,000 fuel stations in Germany. Only about 1,900 of these carry biodiesel, 3,900 liquid gas. This means that Germany is far from establishing a developed network of petrol stations for alternative propulsion technologies. In order to compensate for this disadvantage, vehicles with alternative propulsion technologies would thus have to become much more affordable than conventional technologies. Given the current state of technology, this is highly unlikely. Switching to environmentally friendly cars will thus have to wait.

For further information please contact

Dr. Georg Bühler, E-mail: buehler@zew.de