January 5th, 2009 · 2 Comments

The study weighed factors including the cost of the technology, fuel savings, performance, tailpipe pollutants and greenhouse gas emissions.

“Advanced diesel and hybrid technologies show very well in this study, in terms of benefits to the individual and society overall,” Graham said in a RAND press release.

“While it is assumed that the hybrid vehicle will save more fuel than the advanced diesel, the overall advantage goes to the diesel because of its lower technology costs and better performance such as increased torque,” Graham said. “For E85, it is the cost of producing the fuel, not vehicular changes, that drives the negative results.”

The RAND paper, however, assumed a much narrower price gap between gasoline and diesel that now seen at service stations across the country.

The results assume fuel prices of $2.50 per gallon for gasoline and $2.59 per gallon for diesel fuel – a gap of just 9 cents a gallon. The national average price of regular unleaded gasoline the week of December 22 was $1.66 per gallon, according to AAA. The average price of diesel was $2.49 a gallon – 50 percent more than gallon of gas.

The price difference hasn’t always been so stark. When fuel prices hit their peak in July, the national average price of a gallon of gas was $4.11 while diesel was $4.85 a gallon.

The price of diesel has stayed relatively high because worldwide demand for diesel is higher than the demand of gasoline, said Alan Shaffer of the Diesel Technology Forum. The gap should narrow again as the world economy slows.

While the price difference, for now, negates the savings that come with increased fuel efficiency, there are other benefits to diesel engines – high low-end torque that provides a little thrill when taking off from a red light, well-established durability and higher resale value.

“The informed buyer is going to look beyond what price is posted at the service station,” Shaffer said.
The new breed of diesel cars are eligible for federal tax credits, much like the gas-electric hybrid cars. The tax credit on the 2009 Mercedes-Benz GL 320 BlueTEC diesel, for example, is $1,800. The Jetta TDI is eligible for a $1,300 credit.

The choice among diesel cars is currently limited to BMW, Mercedes-Benz, Jeep and Volkswagen. Chrysler, Ford, GM, Nissan, and Subaru have indicated they intend to introduce clean diesel engines in their light-duty cars and trucks.

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