BONUS - The Electric Vehicle Owner’s Talking Points

This is the bonus in my series on gas tax, roadbuilding and electric vehicles. You can find links to the other parts at the bottom of this post.

Download a printable PDF from here.

1. The gas tax does not fully fund road building and maintenance.Since the interstate highway system was implemented in 1947, U.S. spending on highways has exceeded the amount collected from fuel and vehicle fees by more than $600 billion.
2. Most of the deficit is made up with local, state or regional bonds or municipal property taxes. So even if a person doesn’t drive, if they pay state or federal taxes, they’re paying for road construction and maintenance, a type of infrastructure that only cars, trucks and buses can use.
3. Roads within cities are generally financed through local, property, and sales taxes. They do not get any of the gas tax collected at the pump.
4. Electric cars not paying the small amount that purchasing gas contributes to road maintenance is a bit of a non-issue. Society is subsidizing roads big time.
5. When Congress enacted Corporate Average Fuel Economy (CAFE) standards, they mandated auto manufacturers to improve the fuel economy across their vehicle fleet. Most people agree this is a good thing. As vehicles become more efficient, they put more miles on roads per gallon of fuel, reducing their per mile contribution to the road tax. This is what's really killing the Federal Highway Fund and state fuel taxes collected at the pump.
6. Hybrids vehicle sales account for 2.2 percent of overall vehicle sales, and have yet to hit four percent in a given year. This indicates that the problem of gas tax revenue lost through these vehicles is negligible compared to the decrease in tax collection that has resulted from the nation’s drastic drop in overall fuel consumption. 
7. As of August 2015, the lost gas tax revenue from electric vehicle sales of 365,000 vehicles is shown to be $71.9 million or a loss of 0.23 percent. That's two tenths of one cent of every dollar collected. Cut a penny into 10 parts, remove two of them. Not much.
8. Current assessment is that in 15 to 25 years EVs could make an impact on revenue. This means that now is the time to come up with a new way to tax vehicles for road construction and maintenance.The Highway Trust Fund has experienced a continuing shortfall that is attributed to three major factors:
1. more fuel efficient internal combustion engine (ICE) vehicles,
2. the fact that federal gas rates has not risen since 1993 and
3. the increased cost in highway construction and repairs.

...and not to the advent of electric vehicles.

• Part 1- Introducing the Tricky Question of Electric Vehicles Paying Their Fair Share 
• Part 2 - Changing Trends Include Far More Than Electric Vehicles 
• Part 3 - Gas Tax 101  
• Part 4 - Are Electric Vehicles Making a Dent in Gas Tax revenues NOW?
• Part 5 - Actual Impact of Electric Vehicles
• Part 6 - Some States Experiment With New Ways to Fund Roads
• Part 7 - The Truth is, Gas Taxes Don't Actually Paying for Road Construction and Repairs
• Part 8 - Conclusion
• BONUS - The Electric Vehicle Owner’s Talking Points 

Part 8 - Conclusion

This is the eighth in a eight-part series on gas tax, roadbuilding and electric vehicles. You can find links to the other parts at the bottom of this post.

Innovation (and a few of these blog posts) has laid bare the fact that making drivers compensate the public for their use of the roads through taxes on gasoline purchases alone may not work in the 21st century. In fact, it makes much more logical—and economic—sense to tax people based on the number of miles they drive, and perhaps on the size and weight of their vehicle. Furthermore, I don't believe that electric vehicles are not part of the road funding deficit, they merely point out the problem that funding road construction and maintenance from a gasoline "use tax" is an archaic method that needs to be replaced with something far more elegant, progressive and fair to ALL vehicles that put two, three, four, 10 or 18 wheels on the road.

There is one final perspective I think is worth adding to the road funding discussion. Somewhere along my life, I read that the Roman Empire was as good as it's roads. A quick online search for "roman road network importance" found the following fascinating article, 8 Ways Roads Helped Rome Rule the Ancient World. Of the eight, the following begin the formation of my final perspective:

• Roads were the key to Rome’s military might.
• They were incredibly efficient.
• They were easy to navigate.
• They were well-protected and patrolled.

The start of this idea is that far more than individual drivers benefit from roads. People who don't drive benefit from mass transit that does use roads. Police, ambulance and fire service use roads to quickly get to where they are needed. Of course they pay the gas tax when they fill up, but roads allow these services to add so much more value to society by allowing them to move quickly throughout the built environment.

On the other hand, while vehicles like buses, large trucks and even construction equipment driving on and building roads do pay the same gas tax, I question whether they are paying enough for the weight, wear and damage they apply to the infrastructure and the physical footprint they occupy on the actual road. For once, I'll give the military a break. When I was a kid my brothers and I would watch enormous convoys of military trucks driving up U.S. Highway 61, taking lots of space, adding their collective damage to the surface. However, since I have now learned that the federal government is adding a lot to the Highway Trust Fund, I'm giving the military a pass on their use of the roads. The federal government has covered their "use."

Well-placed, well-designed roads make life better for everyone. I am confident that as fuel efficient vehicles of all sizes continue to occupy roads and as electric vehicle sales increase, states and or the federal government will develop a road funding system that charges passenger and transport vehicles for the miles they are driven, plus state and federal funding that adds to highway and road needs because they are good for civil society for everyone.

Just for the fun of it, I created a bonus set of talking points for every electric vehicle driver to have on hand should someone start a conversation with “You’re not paying your fair share of the gas tax.” You can read and print them from my next blog entry.

Part 1- Introducing the Tricky Question of Electric Vehicles Paying Their Fair Share 

Part 2 - Changing Trends Include Far More Than Electric Vehicles 

Part 3 - Gas Tax 101  

Part 4 - Are Electric Vehicles Making a Dent in Gas Tax revenues NOW?

Part 5 - Actual Impact of Electric Vehicles

Part 6 - Some States Experiment With New Ways to Fund Roads

Part 7 - The Truth is, Gas Taxes Don't Actually Paying for Road Construction and Repairs

Part 8 - Conclusion

BONUS - The Electric Vehicle Owner’s Talking Points 

Part 7 - The Truth is, Gas Taxes Don't Actually Paying for Road Construciton and Repairs

This is the seventh in a eight-part series on gas tax, roadbuilding and electric vehicles. You can find links to the other parts at the bottom of this post.

Of all the reading and research I did for this series, what I found most interesting is that gas taxes don’t actually cover all the cost to build and maintain roads and highways. Gasoline taxes account for $31.1 billion or about 87 percent of the Highway Trust Fund (HTF). Since the interstate system was implemented in 1947, U.S. spending on highways has exceeded the amount collected from fuel and vehicle fees by more than $600 billion. Where does the rest of that money come from?

Most of the deficit is made up with local, state or regional bonds or municipal property taxes. So even if a person doesn’t drive, if they pay state or federal taxes, they’re paying for road construction and maintenance, a type of infrastructure that only cars, trucks and buses can use.

However, there is a legitimate argument to be made that regardless of vehicle ownership and gas purchases, we all benefit from roads for public transportation, commercial product transportation, civic use such as ambulances, police and fire vehicles. Roads within cities are generally financed through local, property, and sales taxes - not the gas tax.

In sum, taxes levied on fuel to pay for roads don’t fully cover their costs. Actually, they don’t even begin to cover the costs of ALL the roads in the build environment. So electric cars not paying the small amount that purchasing fuel contributes to road maintenance is a bit of a non-issue. Not saying they shouldn't, it's just not what's breaking the Highway Trust Fund bank. Truth is, federal, state and local governments, and thus tax paying society as a whole is subsidizing roads big time. cleantechnica.com

A recent study attempted to identify how electric vehicles (EVs) would affect the HTF using industry and government reports that detail fuel tax revenues and through analysis of EV sales from 2010 to 2015. Results for electric vehicle market penetration have shown increasing sales, but EVs have resulted in very little impact on gas tax revenues. As of August 2015, the lost gas tax revenue from EV sales of 365,000 vehicles is shown to be $71.9 million or a loss of 0.23 percent. That's two tenths of a penny out of a dollar. Current assessment is that in 15 to 25 years EVs could make a significant impact on overall revenue.

However, long before the advent of electric vehicles, the HTF has long experienced a continuing shortfall that is attributed to three major factors; more fuel efficient internal combustion engine (ICE) vehicles, the fact that federal gas rates has not risen since 1993 and the increased cost in highway construction and repairs. fsec.ucf.edu

Green cars, making up only 3.3 percent of all vehicles sold last year according to WardsAuto, are not creating much of this shortfall. Any special EV taxes or fees states collect in the near term will probably only fill in a few potholes literally. Washington State anticipates bringing in just $127,900 from its new annual $100 tax on drivers who don’t fuel up at the pump. “There are not enough electric vehicles on the road to make a material difference to significantly reduce the revenue to the transportation funds,” says Lloyd Levine, a consultant for the Sacramento Electric Vehicle Association, who drives a Chevy Volt. bloomberg.com

Part 8 concludes this series with a summary and a final perspective on the importance of roads to civil society - there's even a reference to the Roman Empire!

Part 1- Introducing the Tricky Question of Electric Vehicles Paying Their Fair Share 

Part 2 - Changing Trends Include Far More Than Electric Vehicles 

Part 3 - Gas Tax 101  

Part 4 - Are Electric Vehicles Making a Dent in Gas Tax revenues NOW?

Part 5 - Actual Impact of Electric Vehicles

Part 6 - Some States Experiment With New Ways to Fund Roads

Part 7 - The Truth is, Gas Taxes Don't Actually Paying for Road Construction and Repairs

Part 8 - Conclusion

BONUS - The Electric Vehicle Owner’s Talking Points 

Part 6 - Some States Experiment With New Ways to Fund Roads

This is the sixth in a eight-part series on gas tax, roadbuilding and electric vehicles. You can find links to the other parts at the bottom of this post.

In 2013, Oregon lead the way with a voluntary “usage tax” program. Using either a GPS-device (kind of creepy) or odometer readings, 5,000 owners of any car that gets more than 55 miles per gallon are charged a flat annual fee of $542.50, or a usage fee of 1.55 cents per mile. Gas tax paid at the pump is refunded by the state to avoid double taxation. I like this because it's a program that doesn't discriminate between electric vehicles and efficient conventional ones, and comes closer to charging for actual use of roads and bridges.

There are several benefits to this payment scheme. Primarily, people pay for the miles actually driven regardless of the type of vehicle (electric or conventional fuel). I also think that there could be an additional benefit to this type of charging in arrears because if drivers actually see the tax on a per mile basis, they might be encouraged to drive less. This is a behavior that would benefit everyone; fewer miles equals less road wear and tear, less pollution (formed by combustion engines or electric power plant emissions), less noise pollution and less road congestion. It could also encourage healthier behaviors such as biking, walking, carpooling or trip consolidation. It could also improve quality of life by encouraging less time in cars and more time at home. The Oregon program became operational by July 2015. http://motherboard.vice.com/read/what-replaces-the-gas-tax-once-electric-cars-replace-gas

In terms of tracking mileage as is being done in Oregon, some people are not going to like the GPS option. I think a pure odometer reporting mechanism would be a better, more private option. However, since the tax situation is state-based, perhaps the GPS option is necessary to only charge the additional tax for miles driving within the state, or to prevent double paying when using toll-roads. There is also a problem with buying fuel outside the state and where taxes should be paid or refunded.

Here is an example of the benefits of seeing a tax in action to change behavior. A Dutch study showed that information, feedback and suggestion can change behavior. An experiment was done with 5,000 participants divided into three groups; group A) received information about their energy consumption, B) received information and feedback about consumption, and C) information, feedback and suggestions for further reduction. "The results suggest that feedback through web applications does indeed increase perceived consumer awareness and reduces electricity consumption. Experimental groups scored an average much lower in terms of energy savings compared to the control group. Customers were also satisfied with what they had learned from participating in the experiment, implying that their awareness of electricity consumption had increased," (Hemmes, Papyrakis and Beukering)  consiliencejournal.org

In Massachusettes, one proposed source of supplemental income is from charging owners of electric vehicles an additional registration fee. The proposed bill was pushed by Representative Bradley H. Jones (R-North Reading), who called the issue “really one of equity,” making sure that everyone who uses the roads is pitching in. While Jones' bill, which called for an annual $100 registration fee for all-electric vehicles, fizzled in Massachusetts state legislature, other states already have such programs in place. The problem I see with an EV registration fee is that it does not take into account the actual miles driven. If an electric vehicle due to it's inherently limited range can't drive $100 worth of road tax, this becomes a regressive tax that's also "unfair."

I think there is one final consideration to take into account when figuring out a new road tax scheme. For non-commercial vehicles, weight and size are not currently measured or taken into account for road tax with the exception and assumption that they will use more fuel. My thought is that a Smart Car is two or three times shorter than a club cab truck, and is many times lighter. Because it literally occupies less space on the road, and applies far less weight to the road, should it not pay less tax than a large, heavy vehicle? To make my point, (and I know this is absurd, but work with me) if we ONLY drove 11-foot long smart cars, would it be possible that we'd need fewer lanes, shorter highway on and off ramps, less street parking, etc? Again, the point is only to show that yes, we'd need less road infrastructure. I think those vehicles that take up more space and exert more damaging weight on roads should also pay their fair share.

In Part 7 I disassemble the Highway Trust Fund and see that it isn't suffering because of electric vehicles. It's got much bigger problems.

• Part 1- Introducing the Tricky Question of Electric Vehicles Paying Their Fair Share 
• Part 2 - Changing Trends Include Far More Than Electric Vehicles 
• Part 3 - Gas Tax 101  
• Part 4 - Are Electric Vehicles Making a Dent in Gas Tax revenues NOW?
• Part 5 - Actual Impact of Electric Vehicles
• Part 6 - Some States Experiment With New Ways to Fund Roads
• Part 7 - The Truth is, Gas Taxes Don't Actually Paying for Road Construction and Repairs
• Part 8 - Conclusion
• BONUS - The Electric Vehicle Owner’s Talking Points 

Part 5 - Actual Impact of Electric Vehicles

This is the fifth in a eight-part series on gas tax, roadbuilding and electric vehicles. You can find links to the other parts at the bottom of this post.

While plug-in hybrids and full electric vehicles (EVs) have gained considerable momentum since the Chevrolet Volt and Nissan Leaf arrived in 2011, they’re still a minuscule fraction of the nation’s fleet. Through November, 2015, these cars accounted for just 0.6 percent of all U.S. light-duty vehicle sales. Hybrids vehicle sales (those that burn fuel) account for 2.2 percent of overall vehicle sales, and have yet to hit four percent in a given year. This indicates that the problem of gas tax revenue lost through these zero fuel burning or very efficient vehicles is negligible compared to the decrease in tax collection that has resulted from the nation’s drastic drop in overall fuel consumption. caranddriver.com

The following table shows overall revenue from gas vs. electric vehicles.

builtbymichigan.org

The average U.S. gas tax is about 48.7 cents per gallon; this is an average, state-to-state actual rates vary dramatically. The Wisconsin gas tax is 32.9 cents per gallon, with 2 cents of the tax targeted for cleaning up leaking underground storage tanks. At the average 13,476 miles U.S. citizens drive in a year, assuming 20 miles per gallon, using the U.S. gas tax average, the driver pays $328 annually in gas tax.

If they drive fuel efficient cars, their overall fuel tax paid obviously goes down. For example, at the current theoretical average of 25 miles per gallon, the average person pays about $263. If they drive a car that manages 30 miles per gallon, they are down to $218. According to the logic of electric car detractors, fuel efficient cars are getting an unfair ride, too. This is yet another reason to explore alternate ways of funding the Highway Trust Fund. cleantechnica.com

Part 6 explores some options being explored at the state level. 

Part 1- Introducing the Tricky Question of Electric Vehicles Paying Their Fair Share 

Part 2 - Changing Trends Include Far More Than Electric Vehicles 

Part 3 - Gas Tax 101  

Part 4 - Are Electric Vehicles Making a Dent in Gas Tax revenues NOW?

Part 5 - Actual Impact of Electric Vehicles

Part 6 - Some States Experiment With New Ways to Fund Roads

Part 7 - The Truth is, Gas Taxes Don't Actually Paying for Road Construction and Repairs

Part 8 - Conclusion

BONUS - The Electric Vehicle Owner’s Talking Points 

Part 4 - Are Electric Vehicles Making a Dent in Gas Tax Revenues NOW?

This is the fourth in a eight-part series on gas tax, roadbuilding and electric vehicles. You can find links to the other parts at the bottom of this post.

The "electric vehicles are expensive and paying a lot of sales tax" argument may be true, but it won't be for long. Both Chevrolet and Tesla are coming out with pure electric vehicles that will be under $30,000. And used electric vehicles have terrible resale value because new models are taking such huge leaps in technical ability. This means that you can pick up a used electric vehicle very reasonably.

Another problem with blaming EVs for the Highway Trust Fund budget deficit is their sheer numbers on the road. There simply aren't enough of them to single-handedly cause a significant or even a small problem.

“There are not enough electric vehicles on the road to make a material difference to significantly reduce the revenue to the transportation funds,” says Lloyd Levine, a consultant for the Sacramento Electric Vehicle Association. Hybrids, plug-in hybrids, and electric cars may collectively account for about three percent of car sales in any given month. That is to say, electric vehicles comprise a very small share of the vehicles on the road, and will not likely comprise a significant proportion of the vehicle pool for a decade or more.

I'm not saying that EVs should continue not paying for their contribution to road maintenance and building. I'm simply saying that the current problems are not, and can not be attributed solely to EVs. From what I can see, the more immediate issue is that conventional cars are becoming more fuel efficient. In 2012, the Obama administration released new Corporate Average Fuel Economy (CAFE) standards, requiring automakers to raise the average fuel efficiency of new cars and trucks to 54.5 miles per gallon by 2025. The current CAFE standard for small vehicles (cars) is 30 mpg.

Other unintended consequences of imposing special taxes on EVs could end up costing vehicle manufactruring states like Michigan in the long run. I think the last thing we want to do is dampen sales of a product that has a lot of potential to generate jobs for workers and new economic opportunities for auto and advanced-battery manufacturers. And as I pointed out earlier, at the moment EVs generally have a higher price tag, adding additional sales tax to state coffers.

In reality, while electric vehicle sales have been rising, they are still a very small part of the market, so imposing a new tax on them wouldn’t raise nearly enough money to overcome the shortfall states are facing from declining gas-tax revenues. Those revenues have been declining for a number of reasons including greater fuel economy in traditional vehicles and changing driving habits leading to fewer miles driven overall. This means that NOW is the right time to figure out how to tax vehicles appropriately for their use, wear and tear on roads and not to single out electric vehicles with special taxes or fees. ecocenter.org

In Part 5, I examine the actual tax impact of electric vehicles.

Part 1- Introducing the Tricky Question of Electric Vehicles Paying Their Fair Share 

Part 2 - Changing Trends Include Far More Than Electric Vehicles 

Part 3 - Gas Tax 101  

Part 4 - Are Electric Vehicles Making a Dent in Gas Tax revenues NOW?

Part 5 - Actual Impact of Electric Vehicles

Part 6 - Some States Experiment With New Ways to Fund Roads

Part 7 - The Truth is, Gas Taxes Don't Actually Paying for Road Construction and Repairs

Part 8 - Conclusion

BONUS - The Electric Vehicle Owner’s Talking Points 

Part 3 - Gas Tax 101

This is the third in a eight-part series on gas tax, roadbuilding and electric vehicles. You can find links to the other parts at the bottom of this post.

U.S. road and bridge construction and maintenance are paid for with the Highway Trust Fund (HTF) which is partially funded by federal and state gas taxes. In 2016, the United States federal excise tax on gasoline was 18.4 cents per gallon and 24.4 cents per gallon for diesel fuel. On average, as of July 2016, state and local taxes and fees add 29.78 cents to gasoline and 29.81 cents to diesel, for a total US average fuel tax of 48.18 cents per gallon for gas and 54.21 cents per gallon for diesel. These are averages as each state enacts its own gas tax on top of the federal tax. Wikepedia.org In Wisconsin where I pay most of my gas tax, we pay $.24 per gallon for both gasoline and diesel fuel.

As vehicle fuel efficiency increases, as required by the federal Corporate Average Fuel Economy (CAFE) standards, drivers are buying less fuel per mile driven. Tbe CAFE standards are U.S. regulations, first enacted by the United States Congress in 1975, after the 1973-74 Arab Oil Embargo, to improve the average fuel economy of cars and light trucks (trucks, vans and sport utility vehicles) produced for sale in the United States. These regulations helped the economy and (unintentionally) the environment by squeezing more miles per gallon, reducing the need to import oil and reducing carbon added to the atmosphere. Already in the 1970s, each mile driven was adding less tax to the HTF.

Fast forward to the advent of more fuel efficient hybrid and electric vehicles, and states are noticing big deficits in their road-building budgets. Lawmakers and tax collectors saw the obvious problem, electric vehicles (EVs) that don't pay gas tax were to blame. And some states decided they weren't going to idly stand by and put up with these tax evaders.

Right Now, Electric Vehicles are NOT Getting a Free Ride

There are some arguments to be made that EVs are not necessarily getting the free ride people think, even without paying gas tax for miles driven. “While it is true that electric vehicles do not burn gasoline and so do not contribute to the gas tax, electric vehicles generate more in registration fees and sales taxes because of their relatively higher sales prices,” says Ecology Center’s Charles Griffith. “Compared to their non-electric counterparts, electric vehicles contribute more gross revenue and more revenue per mile driven to the state coffers, so saying that electric vehicles get a ‘free ride’ on our highways is simply not true." Ecocenter.org

However, with the advent of the sub-$30,000 Chevrolet Bolt and a Tesla sedan (both releasing in 2017), this is a short-lived argument. So, the real question is, are electric vehicles making a dent in gas tax revenues now? 

In Part 4 I explore how electric vehicles are making a dent in collected gas taxes.

• Part 1- Introducing the Tricky Question of Electric Vehicles Paying Their Fair Share 
• Part 2 - Changing Trends Include Far More Than Electric Vehicles 
• Part 3 - Gas Tax 101  
• Part 4 - Are Electric Vehicles Making a Dent in Gas Tax revenues NOW?
• Part 5 - Actual Impact of Electric Vehicles
• Part 6 - Some States Experiment With New Ways to Fund Roads
• Part 7 - The Truth is, Gas Taxes Don't Actually Paying for Road Construction and Repairs
• Part 8 - Conclusion
• BONUS - The Electric Vehicle Owner’s Talking Points 

Part 2 - Changing Trends Include Far More Than Electric Vehicles

This is the second in a eight-part series on gas tax, roadbuilding and electric vehicles. You can find links to the other parts at the bottom of this post.

Twenty first century trends indicate an overall reduction in the demand for gasoline. First, as baby boomers age, they are driving less. That's a lot of people not using their cars as much. Next Millennials, a generation even larger than Boomers, tend to favor walkable neighborhoods and jobs they can walk, bike or take mass transit to. We all know who the Boomers are, but the term Millennial may need a bit of explanation.

Millennials have surpassed Baby Boomers as the nation's largest living generation, according to population estimates recently released by the U.S. Census Bureau. Millennials, whom we define as those born between 1982 and 2004, now number 75.4 million, surpassing the 74.9 million Baby Boomers (ages 51-69). Millennials eschew the traditional one-car-per-person household, opting to share cars, carpool, rent or use community cars as needed, etc. Similarly, over the past 25 years, there has been a significant decrease in the percentage of young people getting a driver's license. According to the Federal Highway Administration, in 2008, 31 percent of 16-year-olds had a license, compared with 46 percent in 1983. In addition, thanks to a recent weak economy and demographic shifts, the number of miles driven in the U.S. has generally declined or been stagnant since 2007. These generational changes and attitudes are resulting in fewer miles driven, which result in less gas tax collected at the pump.

However, all of these trends and demographic shifts pale in comparison to the real gas tax killer. In the 1970s in an effort to improve gas mileage, a max highway speed of 55 miles per hour helped reduce fuel usage by improving miles per gallon by up to 20 percent. I have read that for every mile faster than 55, the average vehicle loses two percent MPG. A clearer explanation comes from fueleconomy.gov. While each vehicle reaches its optimal fuel economy at a different speed (or range of speeds), gas mileage usually decreases rapidly at speeds above 50 mph. You can assume that each 5 mph you drive over 50 mph is like paying an additional $0.15 per gallon for gas. Kinda makes driving across town to save $.03 per gallon a little silly.

When Congress enacted the Corporate Average Fuel Economy (CAFE) standards, they mandated auto manufacturers to improve the fuel economy across their vehicle fleet. As vehicles become more efficient, they put more miles on roads per gallon of fuel, reducing their per mile contribution to the road tax. THIS is the actual gas tax killer - government mandated fuel-efficient vehicles are getting more miles per gallon, and therefore buying less gas and paying less tax. One could say this is an argument against government mandates. I think this is precisely the role of government, to progress technology and society in an upward trend. Seriously, who’s losing? Consumers get more miles per gallon.

For example, one of the reasons I bought a 2013 VW Golf TDI was because it got 40+ miles per gallon. My insistence on purchasing a fuel efficient vehicle was economic, environmental and practical. However, by purchasing this vehicle vs. a vehicle that got a more typical 25 miles per gallon, I was legally and without anyone turning their head, paying 62 percent less gas tax by driving the Volkswagen. Essentially, I gave myself a legal gas tax break.

The Volkswagen with 40+ MPG is simply an example of how automakers are designing, building and marketing conventional fuel-burning vehicles that burn less fuel. Automakers are successfully improving engine design, using lighter materials like aluminum and improving aerodynamics, all of which improve fuel efficiency. According to the University of Michigan Transportation Research Institute, the typical car sold in March 2015 gets 25.4 miles per gallon; that’s up 26 percent from October 2007 (but still a far cry from the 40+ MPG of the Golf). 

This means that CAFE standards, changing demographics, preferences and behaviors have all left a budgetary void for road maintenance and construction. Electric vehicles have very little to do with road tax shortfalls. 

More in Part 3 about the gas tax.

• Part 1- Introducing the Tricky Question of Electric Vehicles Paying Their Fair Share 
• Part 2 - Changing Trends Include Far More Than Electric Vehicles 
• Part 3 - Gas Tax 101  
• Part 4 - Are Electric Vehicles Making a Dent in Gas Tax revenues NOW?
• Part 5 - Actual Impact of Electric Vehicles
• Part 6 - Some States Experiment With New Ways to Fund Roads
• Part 7 - The Truth is, Gas Taxes Don't Actually Paying for Road Construction and Repairs
• Part 8 - Conclusion
• BONUS - The Electric Vehicle Owner’s Talking Points 

Part 1- Introducing the tricky question of electric vehicles paying their fair share

This is the first in a eight-part series on gas tax, roadbuilding and electric vehicles. You can find links to the other parts at the bottom of this post.

The nugget for these posts was born when I first brought up the idea of buying an electric vehicle (EV) with my dad, he was supportive AND had some reservations. "Roads are built and maintained with the gas tax. You won't be paying that, so you aren't paying your fair share." The A+B does not equal C equation sounded logical, and at the time, I had no response about this concern. During that visit, I agreed with him. States and the federal government will need to figure out a new way to pay for the roads that both fuel-driven and electric vehicles use.

I left uneasy that I would not be paying my fair share. And now that Jay and I own a Chevrolet Volt, a gas/electric hybrid sedan that doesn’t use any gasoline if driven <50 miles on an electric charge that also gets nearly 50 miles per gallon fuel when we travel more than 50 miles burning fuel, I've been thinking more about that conversation with dad. Since we haven't added gas to the vehicle since buying it a month ago, it was time to do some research.

The original idea behind funding road building and maintenance with the gas tax is the more one drives on publicly built roads, the more a vehicle wears and tears roads and bridges, and so with increased fuel purchases, the more the driver pays at the gas pump. Likewise, bigger and heavier vehicles that do more damage to roads and burn more gas pay a larger amount by buying more fuel. By devising a gasoline tax, we created a “use fee” that was easy to collect. By taxing drivers at the pump, the gas tax effectively charged roadway users their fair share.

Back in the "good old days” when vehicles used lots of gas per mile driven, this tax system nearly funded all road building and maintenance. However, herein also lies the problem: the gas tax only works if we continue to burn fuel at the same rate as when this tax scheme was created, and only works if we continue to drive a lot. Both of these trends are changing.

This entry is the first in a series about the gas tax and why we have a much larger problem than vehicles that don't burn fuel using public roads. I invite you to read about my research, exploration and thoughts on the following topics.

• Part 1- Introducing the Tricky Question of Electric Vehicles Paying Their Fair Share 
• Part 2 - Changing Trends Include Far More Than Electric Vehicles 
• Part 3 - Gas Tax 101  
• Part 4 - Are Electric Vehicles Making a Dent in Gas Tax revenues NOW?
• Part 5 - Actual Impact of Electric Vehicles
• Part 6 - Some States Experiment With New Ways to Fund Roads
• Part 7 - The Truth is, Gas Taxes Don't Actually Paying for Road Construction and Repairs
• Part 8 - Conclusion
• BONUS - The Electric Vehicle Owner’s Talking Points 

Solar panels commissioned, we're making electrons!

Update on our photovoltaic (PV) system. We are now creating electricity. With shortened days and snowfalls covering the panes for a few days until the snow blows or slides off, we're not creating nearly the maximum output, but it's still exciting to think that some of the energy we use each day comes from our panels. Below is a snapshot from the app (yes, it's got an app!) that shows December so far. You can see the days when there was snow on the panels (17-21) and when it's been cloudy (most of early December). As the days lengthen and sun gets higher in the sky, we'll get closer to our peak production capacity of six kilowatts and the production will average out.

In case you're wondering how all this works, so was I. I looked this up from eco2solar.

Solar PV systems use cells to convert sunlight into electricity. The PV cell consists of one or two layers of a semi conducting material, usually silicon. When light shines on the cell it creates an electric field across the layers causing electricity to flow. The greater the intensity of the light, the greater the flow of electricity. PV cells are referred to in terms of the amount of energy they generate in full sunlight; know as kilowatt peak or kWp.

I wrote a series about the solar system, if you'd like to read all the parts of this series, you can see them here.

Part 1 - How Volkswagen is Helping us Repay the Planet for Its Sins
Part 2 - Our Search for a Cleaner Car
Part 3 - Buying a Used 2016 Chevrolet Volt
Part 4 - A Lesson on Creating Clean Energy at Home
Part 5 - Making the Decision to Add Solar to our Urban Roof

Here at the bottom the app screen shot is cut off. It calculates an equivalent for three things based on how much energy we produced. They are:

• 2.16 equivalent trees planted
• 167.55 light bulbs powered for a day
• 85.61 pounds of CO2 saved from entering the atmosphere.

Meet Oscar and Bruno

If a picture says a thousand words, these are worth about a million.

We adopted Bruno (gray) and Oscar in October, but it took a long time for them to tell us their names. Oscar let us know first. The gray one whispered "Felix" in deference to The Odd Couple. However, our feline matron, Feliz, was not amused by the mere one letter difference between their names. Thus, we asked the gray one to continue to ponder his name.

Feliz was not amused with Felix's first choice of a name. He went back to the name book.

After a bit of thinking, the gray one came upon a list of Sesame Street characters, and to his delight discovered that Oscar the Grouch had a companion, a friend if you like, in Bruno the Garbage man. On the show, Bruno would pick up Oscar's can and take him for a walk around the neighborhood. Bruno is also a bit bigger than Oscar.

So, Bruno it is. We're loving having the kittens around.
The furniture isn't sure.
And Feliz still isn't amused. But she does love the extra doses of cat nip she's been getting!

Chickens earn their keep

This summer I built a chicken tractor. You can read more about that here. 

I built the dimension to be the same width and half the length of our backyard 5'x16' raised garden beds. The 5'x8' tractor fits neatly on top of the sides of the beds.

This allows me to put the lightweight tractor over a bed, and then after stuffing the birds in there (they haven't figured out how to get up into the beds and the tractor on their own) they scratch, poop and generally make a mess of the garden. This is EXACTLY what I want. They till the soil, eat bugs and leftover seeds and plant material.

So this, err, these, happened today

My day job is to teach small business owners how to use social media. So I know that cats rule the Internet. Forgive me for a moment to veer from sustainability, permaculture and community building to share with you photos of the newest additions to our urban family.

More about their story later - for now, enjoy kitten bliss.

Part 5 - Making the Decision to Add Solar to our Urban Roof

This is the last of a 5-part series about how buying a diesel vehicle in 2013 resulted in an electric car and renewable solar panels on our house in 2016. 

If you'd like to read all the parts of this series, you can see them here.
Part 1 - How Volkswagen is Helping us Repay the Planet for Its Sins
Part 2 - Our Search for a Cleaner Car
Part 3 - Buying a Used 2016 Chevrolet Volt
Part 4 - A Lesson on Creating Clean Energy at Home
Part 5 - Making the Decision to Add Solar to our Urban Roof

After seeing my friend Claire's photovoltaic (PV) array, I asked around and did some research to see what it would take to have a system installed on our urban home. I found three main solar panel installers. I met a representative from HH at Claire's house (learn more about Claire and her PV system), and asked them to come to the house to see if we had enough sunny roof space to make a viable PV installation. I liked them because Claire liked them and I trust her and because they were offering a group buy discount to anyone who was a member of Fair Share, our local community supported agriculture (CSA) coalition.

However, because a solar array is not cheap (more on this in a moment) I decided this construction decision required a second quote. Full Spectrum is the second company I invited to review our situation. They won the City of Madison request for proposal to be the preferred installer for their MadiSun program. They also had a group buy discount.

Both representatives were pleasant and professional. The Full Spectrum quote came in a little cheaper with a few additional benefits, and he seemed to understand the energy requirements needed to generate power for both the house and the electric vehicle. Being part of the MadiSun program gave me additional peace of mind. I accepted their offer and signed a contract, and sent a respectful note to HH indicating we had selected a different vendor.

The nuts and bolts of installing residential solar

The roof on the "bottom" faces southwest, not ideal,
but not a deal-breaker.

We have a southwest facing roof. In the photo at right, our house i the big one in the upper center. LOTS OF ROOF SPACE.

The ideal roof faces south, but our southwest orientation would work and in fact benefits the utility a bit. Late afternoon in the summer is when they experience high demand for energy use (think air conditioning). A solar array on our roof will produce electricity later into the day than a strictly south-facing roof, generating energy at peak demand times.

We have some shade on the southeastern part of our roof (you can see the shade in this photo) from our neighbors gosh darned red maple (I have harsher words, but this is a family blog). But enough of our roof is clear that we are a good candidate for a PV array.

Full Spectrum charges a Volt from panels on their shop roof.

The next thing was to determine the system's generating size. We provided the installer two years of utility bills to help determine our annual electricity usage. Fortunately, we've had our two roommates for one of those years, so the bills should reflect accurate energy use. We also told Mark from Full Spectrum about the planned Chevy Volt, and he crunched some numbers to figure out how much more energy we'd need to create and how much larger a system we'd need to build to power the car. Our project engineer, Mark, had a good idea about the vehicle needs because Full Spectrum has a Chevy Volt!

Here's how the contract works out:
The installer calculated that we would need to create 6 kilowatts of energy to cover our home and electric vehicle (EV) needs. Here is how we arrived at the final purchase price:

Approximate installation plan.

• $20,000 for panels, inverters, labor and an extended warranty
• - MadiSun discount. By attending a MadiSun class on how the program works, we were eligible for this discount. I don't know how much it took off the price of the system.
• - $2,400, rebate from Focus on Energy 
• - $6,000, 30% renewable energy federal tax credit. For those who aren't tax accountants, this is a credit against our taxes in the next year. That means if we owed $10,000 in taxes, and the system costs $20,000, we would pay 30% of $20k, or $6,000, less in taxes.
• $11,600 we have to pay after rebates, tax credits and discounts.

Now, we don't have $20,000 laying around, and even after we get the rebate, tax credit and the discount, we will need to come up with about $17,600 this year until we get the tax credit with our 2016 refund in early 2017.. We decided to take out a home equity loan of credit, which at today's interest rates is relatively cheap money. Still, it's an expense, and we will have about 10 years of payments to make. This will be a new loan, and new loan payments that we didn't have before the solar installation.

But without doing any funny math, I'm about to show you how to make this loan payment go POOF! bye bye. 

Remember those solar panels on the roof and the meter that runs forward and backward? If we size the system correctly, we will make just as much energy as we need each year. This means that the electrical portion of our utility bill will only have a gas charge plus the utility charge to be connected to the electric system. There should be little or no charge for electricity. Our bill will be literally $80-90 less each month. And remember our new Chevy Volt? No gas, or at least very little. Poof! No gas station trips, no money for gasoline.

What this means is that we will effectively send money to our credit union money for the loan and interest, and not send the utility roughly the same amount of money. The loan will be paid off in 10 years, and the panels will continue to produce energy for 20 more years.
This mean we will create emission free energy for 30 years, and cost-free energy for 20 years. Literally, free.

We do have one other expense. Our electrical service (the electric line from the street to our house and the breaker panel in the basement) are just on the cusp of being overwhelmed by the new PV system requirements. When adding circuits to accommodate charging the car we risked taxing the service. So we will pay $1,750 to upgrade to 200 amp service and install a new panel and electric meter. It's something we've thought of doing anyway, and any real estate agent will tell you that 200 amp service makes an older house much more sellable. And, any costs associated with installing PV service are also eligible for the 30% federal tax credit. This means the $1,750 upgrade that will make our house more salable down the road will cost us $1,225.

Let's be clear, you're helping me do this
The things that make this affordable are the federal tax credit, the Focus on Energy rebate and the group buy discount. Yes, we are using YOUR tax dollars to fund this. Another perspective is that I'm using the federal tax dollars I pay to help install sustainable electricity generation on our rooftop, and your tax dollars are going to build roads and fund the military.

Another way to think of it is that all of our tax dollars are going toward generating energy which, with enough residential installations, our local utility won't have to build another power plant (that would cost all of us more in utility rates) or the utility won't have to buy expensive energy during peak demand times because we have people generating energy for them.

However you slice it, this scheme is federally subsidized. Personally, I'd rather my tax dollars going to a distributed energy production system than corn subsidies, bombs or more roads.

Our system will be installed in early November. I'll be sure to write about it and include lots of photos.

If you'd like to read all the parts of this series, you can see them here.
Part 1 - How Volkswagen is Helping us Repay the Planet for Its Sins
Part 2 - Our Search for a Cleaner Car
Part 3 - Buying a Used 2016 Chevrolet Volt
Part 4 - A Lesson on Creating Clean Energy at Home
Part 5 - Making the Decision to Add Solar to our Urban Roof