Demand for Transportation Fuel
The United States is a vehicle-dependent society. More than 9 out of 10 American households own at least one vehicle, and most households own two. In 2004, vehicles in the United States traveled close to 3 trillion miles, up more than 20 percent from 1995. Commuting and other business-related activities account for about 35 percent of vehicle miles traveled. Americans also use their cars and trucks to go shopping (15 percent of miles driven), attend to personal and family business such as medical appointments and dropping children off at school (25 percent of miles driven), and for social and recreational activities, including vacations (22 percent of miles driven).
In spite of widespread vehicle use, the proportion of the American household budget spent on transport fuel is small (less than 4 percent). That said, Chart 6-4 shows that a significant share of vehicle miles traveled are related to nonwork activities, indicating that households may have some flexibility to quickly adjust when the costs of travel are high. In response to higher prices, drivers make two adjustments: they drive less and they purchase more fuel-efficient vehicles. Several studies have found that these two effects combined imply that a 10 percent increase in the price of gasoline will result in about a 4 percent decrease in gasoline consumption in the long run. Compared to other commodities, households gasoline consumption may take several years to respond to price changes.
State and local initiatives that encourage use of mass transit and carpooling focus on encouraging people to drive less. In New York City, the most densely populated of all cities in the United States, mass transit accounts for 45 percent of all commutes into the central city. New York, however, is unique. Many U.S. cities, such as Phoenix and Los Angeles, are spread out over a large area, making it difficult to design mass transit corridors that effectively meet the commuting needs of travelers. Public transportation also has difficulty competing with the flexibility and convenience of car travel in these types of cities. In the entire United States, 5 percent of commuters rely on public transportation.
One way many urban areas try to encourage carpooling is through the designation of high-occupancy vehicle (HOV) lanes. This method rewards carpooling by allowing vehicles with two or more passengers to travel in lanes not open to vehicles with only one person in them. In this way, HOV drivers can reduce travel time when roads are congested. Unfortunately, HOV lanes are often underutilized and the popularity of carpooling is not increasing. In 2000, 90 percent of American commuters drove to work each day, but of these drivers only about 13 percent carpooled, down from almost 20 percent in 1980. This trend makes it unlikely that initiatives focused on carpooling will make large strides in reducing vehicle fuel use.