American consumers have been enjoying Christmas since July – that is, July 2014, when the average price for all grades of gasoline peaked at US$3.75 per gallon, according to the Energy Information Administration. Since then, prices have declined substantially, as every motorist knows: to $2.90 by Thanksgiving 2014 and to $2.14 as we approach the end of 2015. In many parts of the country, the price of regular gasoline is well below $2 per gallon today.
Consumers say their home energy bills would have to more than double before they become unaffordable, according to the University of Michigan Energy Survey.
The survey measures the affordability of consumer energy costs based on two key indicators: home energy bills and gasoline prices. Consumer sentiment regarding home energy expenses has remained stable over the past two years, but it proved more sensitive to changes in gasoline price.
Consumers feel their home energy costs would have to more than double before they had to use less or reduce other expenses to compensate, according to a new index created by the University of Michigan's Energy Institute and released today. The university's energy affordability indices are modeled on U-M's Survey of Consumers, and like their progenitor, the surveys ask questions of consumers about how much their own bills for things like gasoline, electricity, and home heating would have to rise before they became unaffordable. The energy surveys, which canvassed 3,400 Americans over two years, found that throughout the survey period, even consumers in the lower third of the income scale would have to see their home energy costs double before costs broke the bank. The survey also looked at gasoline prices and found that consumers would not find it unaffordable to fill their tanks unless pump prices more than doubled to $5.50 a gallon.
Two newly developed indices measure the perceived affordability of energy by examining the levels of home energy bills and gasoline prices that U.S. consumers say they would find unaffordable.
To date, the affordability of energy has been typically studied through an economics lens. For example, researchers may set a household expenditure-based standard of living, then assess energy costs as a pre-determined share of a household budget assumed to sustain that standard of living.
But what do consumers themselves believe they can afford? That depends on their personal views of how their own energy expenses affect their everyday lives. Although they relate to household budgets, such beliefs are psychological rather than purely economic.
On November 30, as the Paris international climate conference was getting underway, the U.S. Environmental Protection Agency (EPA) announced a long-overdue update of Renewable Fuel Standard (RFS) requirements. Originally established in 2005 and then greatly expanded by the Energy Independence and Security Act (EISA) of 2007, the RFS mandates increasing use of ethanol, biodiesel and other biofuels in America's cars and trucks.
This week, leaders from about 150 nations have come together in Paris for the United Nations Conference on Climate Change, with the goal of taking international action to limit carbon and greenhouse gas emissions.
A delegation of 10 U-M faculty members and students are attending the U.N. conference, including participants from the School of Information, the School of Natural Resources and Environment, the College of Engineering and the Gerald R. Ford School of Public Policy.
Two new Department of Energy grants that total $5.4 million will let University of Michigan engineering researchers work on “transformational” engine and battery projects. Their efforts could lead to efficiency gains in cars and trucks, the electrical grid, and beyond.
ANN ARBOR—Could vehicles that communicate with each other and their surroundings, helping drivers avoid crashes, also save energy?
The University of Michigan is working with two U.S. Department of Energy national laboratories to study whether connected and automated vehicles could help people drive more efficiently. U-M, with Argonne National Laboratory and Idaho National Laboratory, won a three-year, $2.7 million grant from DOE to fund the research.