Transcript

Gas Prices: Saving at the Pump

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Brian T. Castelli
Executive Vice President and Chief Operating Officer, Alliance to Save Energy
Friday, August 19, 2005; 10:30 AM

Alliance to Save Energy 's Brian T. Castelli was online to discuss rising gas prices and how consumers can save at the pump and use energy more efficiently.

Castelli has nearly 30 years of national and international experience in the energy field, including expertise in energy efficiency, renewables, emission reductions, and electricity demand reduction. Prior to joining the Alliance in July 2005, Castelli ran his own energy consulting firm. The Alliance's mission is to promote energy efficiency worldwide to achieve a healthier economy, a cleaner environment and greater energy security.

A transcript follows.

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washingtonpost.com: Thank you for joining us today Mr. Castelli. Before we get started with questions from our readers, please describe the Alliance to Save Energy -- what your goals are, how your organization pursues those goals and who your partners are.

Brian T. Castelli: The Alliance to Save Energy is a non-profit coalition of business, government, consumer and environmental leaders that promotes energy efficiency world-wide to benefit the economy, environment, and energy security. We believe that energy efficiency should be the cornerstone of a national energy policy. Consequently, we advocate for clean, energy efficiency policies at the federal and state level as well as conducting consumer education campaigns to empower consumers to lower their energy bills at home and on the road, including our Powerful $avings Campaign with the US Department of Energy, as well as public service advertisements. We also conduct energy efficiency programs in the United States and overseas. These programs range from industrial programs such as BestPractices Steam to educational programs such as Green Schools and Green Campuses to codes and standards activities for the commercial and residential building sector. See, our website at www.ase.org for more information.

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Central VA: Good morning!; I really appreciate you taking my question. I drive a late-model Saturn SC, and my goal is to break 40 mpg. With slow take-offs, minimizing braking by coasting to red lights, and setting my cruise control to 60 mph, I've alllllmost gotten there -- my best showing so far is 39.55 mpg.

Is there anything else you can suggest? I'd really like to be able to make that number!;

Thank you ever so!;

Brian T. Castelli: One, you can keep your tires inflated to the recommended tire pressures. If you need new tires, switch to a comparable, but low rolling resistance tire. Two, you should avoid idling for any extended length of time. And three, you should perform regular oil changes, air filter changes and tune-ups.

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Reston, VA: OK, I keep my tires fairly well inflated, wash the car, keep my car light, drive without the A/C, and keep the windows up at speed. Essentially, I've kept my car as aerodynamically clean as possible......

And I tend to get 3-5 miles/gallon more than the rating for my car (I get between 29-32 mi/gal), so that tells me that my driving style isn't too bad.

What else is there to do?

Brian T. Castelli: We hate to see you going w/o the AC -- energy efficiency means using technologies --as well as what we call "smart energy practices" -- to use less energy w/o deprivation.

In addition to what we told the previous questioner, you can get regular tune-ups, combine trips to travel the shortest distance, use cruise control and overdrive on the highway as appropriate, and consider a hybrid the next time you are in the market for a new or used car.

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Silver Spring, MD: Besides higher prices, what needs to happen for a critical mass of consumers and businesses to take energy efficiency and its environmental benefits seriously enough to change their purchase behavior for appliances, cars, cooling equipment and the like?

Brian T. Castelli: While higher energy prices should signal consumers and businesses that energy efficiency purchases make economic sense, in some instances, higher costs for those products make a consumer hesitant to purchase and businesses reluctant to produce those products. Therefore, it is sometimes necessary to provide additional incentives to help mitigate the differential cost between energy efficient products and those that aren't. The newly signed energy law has provided tax credits for both the consumer (e.g. a number of more efficient products, ranging from hybrid vehicles to residential insulation, efficient windows, doors, etc) and businesses (clothes washers, dish washers and refrigerators).

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Reston, VA: Would a one day per week, or even one day per month boycott of fuel purchasing have an impact on current gas prices? If enough people didn't purchase gasoline on a specific day of the week, would it help to drive prices down?

Brian T. Castelli: What you are describing is a "conservation" strategy. It likely would have an impact on current gasoline prices, but would also come at a price to our normal practices. Having more efficient vehicles (higher mileages vehicles such as gasoline/electric hybrids) could provide a much longer lasting effect and impact on prices. When consumers continue demand for these vehicles, the price differential between the hybrids and comparable non-hybrid vehicles will drop and they will become a much larger share of the automobile market.

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Boss, Missouri: Mr Castelli

I realize that the U.S is a very wasteful country and needs to become more energy concious, However the intrastructure for transportation is not available to the rural citizens who must travel long distances to work, shop, or seek medical attention. Greed prevents real progress in creating effecient vehicles. In short the gas prices are devastating the general U.S. population who must constantly rearrange their already economically stressed budgets, just to keep gas in the car to go to work. Unnecessary trips like vacations and weekend outings are being cut, which means less vacation and customer service jobs and more unemployment. Less money for food, housing, clothes, or gas. Three cheers for the petroleum fat cats who are committing legal rape of their fellow citizens and don't give a dang about folks less financially secure then they are. Throw out the commandmant "thou shall not covet" throw out the advice "to do unto others as you would have done unto you". If its legal, then rape and pillage then run to another country with your ill gotten gains.

Where has the morality and caring about your neighbor and community gotten to?

Sincerely

Louise Shaw

Brian T. Castelli: WE feel your pain, Louise. a recent Associated Press-AOL poll showed that 64% of Americans felt higher gas prices would cause them and their families hardship over the next 6 months. the previous poll in April was at about 50%, and also showed that many folks were changing travel plans because of the higher gas prices. Contact your political leaders and demand that they address US oil dependence with meaningful national policies ot reduce our oil use.

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Arlington, VA: My family purchased a replacement washer and dryer this year and choose an energy/water efficient front loading washer. Are their any tax breaks available to us as consumers under the Energy Policy Act of 2005 for such a purchase? We've already noticed that we can wash bigger loads of clothing with significantly less water. Also, because the spin cycle is more efficient, our new dryer (with a moisture sensor) operates less as well.

Brian T. Castelli: Unfortunately the new tax credits don't go into effect until January 1, 2005, and those for washers go to manufacturers. we hope that they will pass along the savings to consumers in the form of lower prices for the products (also dishwashers and refrigerators). there are consumer tax credits in 2006 and 2007 for "building envelope" components like insulation, doors, and windows. see our website www.ase.org for details -- there is a link from the energy law story on our homepage. But good for you for going for the energy-efficient product, which WILL save you money on your home energy bills; you'll also produce less air pollution when as you use less energy.

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Arnold, Md: What is happening in the wind energy area? This is clean energy, I believe affordable but we are not seeing it's development

Brian T. Castelli: Actually, wind is being developed, both world-wide and in the United States, at a record pace. As you indicate, it can now be produced at a cost equal, in many cases, to the lowest cost fossil fuel electric generators. Many years of technological research and development (spearheaded by the National Renewable Energy Laboratory in Golden, CO) has gone into reducing the cost and increasing the output of wind turbines. In addition, many states have enacted Renewable Portfolio Standards, which are driving wind installations in those states.

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Vienna, VA: My husband and I grew up during the two energy crises of the 1970s and were profoundly affected by those events. We have put a lot of effort into insulating our small house to make it more energy-efficient, we use fluorescent light fixtures, we work at home instead of commuting, and most recently we replaced our Volvo with a Prius. (45 mpg in town, which is triple the in-town mileage of our previous car.)

We feel that all these measures save us a lot of money as well as using less energy. With the exception of the commuting thing, these energy-saving steps are readily available to everybody.

My question is this: If everybody in the country actually TRIED to use less energy, would these combined efforts allow our country to stop importing foreign oil?

Brian T. Castelli: The US can never be completely oil independent -- we use 20 million barrels a day out of a worldwide use of 80 million barrels, and we have only 5% of the world's oil reserves. HOWEVER, all the measures you have taken DO make a difference, and clearly if more folks did more to use less, we would be in a less vulnerable position with regard to national security and price. another factor is that we are in a global economy, and there is rising energy demand, particularly from China and India.

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Tulsa, Oklahoma: How quickly are the auto makers going to ramp up production on more fuel efficient cars?

Brian T. Castelli: worldwide, automakers are ramping up to produce more hybrid models across all lines -- from sedans to SUVs. there should be several dozen options w/in 10 years.

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South Arlington, VA: Mr. Castelli - I believe what a prior poster noted regarding avoiding gas purchases on a particular day was not "conservation" per se, but the so-called "gas-out." The idea is to put a dent in the "greedy oil baron's" profits to convince them to lower allegedly artificially high prices. Such "gas-outs," however, merely delay or advance fuel purchases without having any real impact on conservation or oil company profits. It seems that folks would be better served by limiting use of vehicles (i.e., walking or bicycling more and using mass transit), combining errands through efficient route planning, and carpooling.

Brian T. Castelli: Valid Point. However, if a consumer does not drive to work on a given day (but with the advances in technologies since the 70's - hi-speed internet, home computers, etc.) then consumption of gasoline for commuting is actually cut. In addition, as you note, not driving one day may in fact cause consumers to combine errands and short trips which also reduces oil consumption.

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Wheaton, MD: What are your thoughts about ideas that are kinda fringe now, like green roofs or passive solar design?

Brian T. Castelli: I don't consider these ideas as fringe. In fact, they are often incorporated into design and construction of new commercial and residential buildings. In fact, these technolgies are recognized and given credit by the US Green Building Council in develping their ratings for "green buildings".

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Washington, DC: Hello,

I remember a few years ago when hybrids were just coming out, there were some studies done that basically said that the money saved on gas would only defray only a portion of the extra thousands a hybrid costs. Any idea what price gas will have to reach to, on average, make a hybrid's gas saving equal the extra cost of buying one?

Brian T. Castelli: if you are replacing a vehicle that gets very low miles per gallon with a very high mileage hybrid, today's gas prices make it economically sensible to purchase the hybrid. also, there is currently a $2,000 tax deduction for that purchase (tax year 2005) and a potentially much more valuable tax CREDIT in 2006 and 2007 for hybrid purchasers; these credits help defray the higher puchase price. the IRS criteria are not yet spelled out, but Toyota has estimated that the credit for a Prius will be in the $2,500 to $3,000 range. each manufacturer is capped at 60,000 vehicles eligible for the credit, so sign up now for 2006 purchases!

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Arlington, VA: "Contact your political leaders and demand that they address US oil dependence with meaningful national policies ot reduce our oil use."

What national policies would you advocate? Hopefully, not something as meaningless as increased CAFE. From my view, blaming vehicle manufacturers for consumer demands for high horsepower, high fuel consumption, large vehicles is not the answer. It would seem that manufacturers are already financially motivated to produce the most fuel efficient possible - afterall, there are months long waiting lists for hybrids (which makes me wonder why the federal government passed incentives for these vehicles - seems the free market is already booming in this area).

How about INCREASING the gasoline tax? Seriously. Such an increase could be limited to urban areas where consumers have a choice in transportation modes. More rural regions could have less tax given the lack of alternatives like mass transit. Seems such a disincentive would work to really change consumer habits versus finding a quick scapegoat that doesn't really have any meaningful effect.

What other concepts would you or your organization advocate?

Brian T. Castelli: Go to our website www.ase.org and put "cafe loopholes" into the search engine to see a variety of optional policies that we advocate. Increasing the gas tax may be a moot point at this time, since the market seems to have raised the price of a gallon of gasoline far past any "gasoline tax" increase proposed in the past.

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Reston, VA: Brian

So what are some tips to keep our homes from eating at our budget? We have electricity and gas - how can we either minimize use (unplug the TV during the day?) or minimize cost (replace windows, etc.?)

Thanks in advance

Brian T. Castelli: Great question! we have a wealth of home energy- and money-saving tips on our website at www.ase.org/consumers. briefly, make sure you have sufficient insulation, look for the Energy Star label on many energy-using products, from home applicances to heating and cooling equipment, to electronics like computers, stereo equipment, answering machines, etc. A programmable thermostat costs about $100 or less and can automatically turn the AC or heat down -- so you don't have to remember on a daily basis -- when the house is empty for eight hours. Energy-efficient windows are terrific, but they are costly compared to other EE products -- but if you are replacing your windows anyway, certainly DO go for the EE ones.

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Falling Waters Wv.: Every time we hear of Fuel prices we have someone mention the high prices of fuel in europe, Why is it not mentioned that they pay the same prices we do for fuel, the difference is TAX,

Brian T. Castelli: Actually, we always note that the high European prices paid for gasoline, diesel, etc. are due to taxes imposed by those countries. However, those high prices over the past few decades have led their consumers to purchase more efficient vehicles and their manufacturers to produce them.

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Arlington, VA: It's very frustrating to want to be energy-efficien but have so little control over your finances. I would love to purchase a hybrid car, but as a graduate student, there's no way I can afford one. I rent, so I have no control over my appliances, therefore no way of controlling my energy bill. Besides taking the steps you've mentioned for improving gas mileage and basic energy-saving tips like turning off lights when you leave a room, how can someone with very little money help contribute and become less energy-dependent?

Brian T. Castelli: Compact fluorescent bulbs cost somewhat more than incandescent bulbs, but they last up to 10 times longer and use about 1/4 of the energy of incandescents. they also produce less heat, so you don't have as large a heating load in the summer. as noted before, for the products you DO purchase, look for the Energy Star label -- those products can save you up to 30% on your electric bil. If your landlord needs to replace an appliance like the refrigerator, suggest an Energy Star product. In any case, appliances are getting more energy-efficient all the time, so a new one will most likely use less energy than the old one, again reducing your electricity bill. if you pay for heat, caulk and weather strip around the windows and any doors to the outside to conserve heat, and/or get plastic film for the windows-- a low-cost item at a hardware store.

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Stratford, CT: What I do not understand about the gas prices rising is that the world's energy inefficiency is nothing new. What is that factor ultimately driving the price? Everyone says its complicated and it hinges on several things; however, if it were hinged on several things it could be de-hinged so to speak and I do not understand why it does not seem like any proactive motion is even taking place even on the drawing board.

Brian T. Castelli: World and US energy demand continues to rise -- and the price goes up with demand. economics 101. however, as we develop and use more energy-efficient products and technologies, we use less than we otherwise would. In fact,energy efficiency has met 40% of US energy demand in the past 30 years or so. that means that w/o EE, the US would use 40% more energy today than it does.

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McLean, VA: I have a year-old Jeep Liberty. Standard issue gas, not one of thier newer Diesel or other models. I bought an SUV for a specific reason (a small catering business), plus I had a short commute. Well, the reason I purchased the car is not taking up as much of my time as it did in the past, and now my commuting distance has more than tripled, plus it's stop and go vs. mostly highway. I sold my ancient VW which was giving me 27mpg for my liberty, which I feel lucky to be getting 15-16mpg. If gas prices continue to rise, I'm going to be in the poorhouse!; I've heard of converting a car to a hybrid, I've thought of selling for a more fuel efficient vehicle. But, bottom line, each option will cost me $$ - more money than I would save, though?? Any thoughts or tips??

Brian T. Castelli: Actually, some help may be at hand. The new energy law provides a tax credit for purchasing hybrid vehicles, starting January 1, 2006. (Remember a tax credit is more beneficial to you than the tax deduction that is currently permitted). If you move from a 15 mpg vehicle to a 50+ mpg vehicle, at the current gasoline prices, you can start to see a major annual fuel savings, which when combined with the tax credit, may not cost you any more than the purchase of a non-hybrid vehicle.

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Herndon VA: One thing I find interesting is how the recently passed energy bill does nothing to lower costs right now, nor does it appear to promote reduction in oil use. As much as I would rather not think our elected officials are looking out for their own best interests, this seems suspicious. There is a finite amount of oil left in the world, so it is in the best interest of the oil companies to make as much money as possible before they run out of product. Rather than having use trickle off over time, the oil companies would rather take as much profit as they can and let the next administration deal with the impending energy crisis. The energy bill should have increased mileage requirements for new vehicles and provided plenty of incentives for development of alternative energy sources.

Brian T. Castelli: For better or worse, increasing fuel economy standards is a political non-starter. And while the new energy law could have done a lot more on the energy efficiency front, it does take some steps in the right direction.

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Attention Suburbanites...: Quick Point:

My trip on Metro today cost less than your average gallon of gas, $2.25 vs. average gallon of gas $2.50. Even with the hikes in fare rates Metro seems like an easy way to defeat the costs at pumps.

Brian T. Castelli: We certainly do encourage use of public transportation. In fact, the Alliance provides its employees with MetroChecks (which can be traded in for bus tokens, too) to encourage that.

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Los Angeles, CA: Mr. Castelli, thank you for taking questions. I recently considered buying a Hybrid but decided against it based on 2 factors: one, the high cost of hybrids seems to negate the fuel savings and two, I'm told by people familiar with the technology that I should wait a few years until all the glitches are worked out--one incident they had in mind when telling me this is the recent recall of thousands of Toyota Prius hybrids because the engines were shutting off entirely at 55 mph speeds. your thoughts?

Brian T. Castelli: Maybe you should reconsider. I own two hybrids now and love driving both. I bought my first one 3 and one-half years ago, so enough time to work out glitches has passed. Virtually all makes of vehicles have had recalls and the hybrids, I believe, are among the lowest around. Also, a number of the technologies employed in the hybrid vehicles are found, individually, in non-hybrids. The technologies are not so much exotic, as they are packaged in an integrated manner that make the vehicle work so well.

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Crofton, MD: I own a Ford Explorer and recently found out that it can take the ethanol blend. After quite a bit of searching I found one gas station in my area that sells it. I know that it is environmentally more friendly and reduces the use of oil, but I lose 5 miles per gallon. So is it really a better trade off? And, no don't tell me to get a hybrid because I cannot fit two 90 pound German Shepherds in it, and this is my only car.

Thanks.

Brian T. Castelli: Now this one hits close to home. I also have two German Shepherds, both over 100 pounds, so I was faced with the same choice. However, both Ford and Lexus offer hybrid SUVs and my German Shepherds seem quite content riding in the space behind the back seats in our hybrid Lexus. Their are choices and the Ford SUV Escape may be the answer to your Explorer and Shepherds.

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washingtonpost.com: Brian, thanks for joining us. Any parting thoughts?

Brian T. Castelli: First, let me thank all of you out there for submitting such provocative and interesting questions. I'm sorry we couldn't get to all of them in the short time we had on-line. Please go to our website www.ase.org to learn more about the Alliance to Save Energy and the many tips on how to reduce your energy bills at home and on the road.

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