1. SCENARIO 1: CURRENT MIX  CO 2 Emissions: 2.039 billion metric tons  Financial Cost: $492.4 billion Gross Consumer Cost: $489.2 billion Indirect Costs: $3.2 billion –Infrastructure: $0.7 billion –Conversion: $2.5 billion The Automotive Fuel Sustainability Model ABSTRACT While gasoline and diesel are the most commonly used automotive fuels, they contribute significantly to global warming through greenhouse gas emissions. As a result, scientists and engineers around the world are working to develop alternative fuels that have significantly fewer emissions. In order to make an appropriate comparison between the cost of using traditional fuels and alternative fuels, the entire lifecycle of each fuel must be considered, including production, transportation, and usage. For example, even though electric cars produce no emissions while running, the generation of that electric power may originate from highly polluting sources such as coal. This project team has designed a model that minimizes the total cost of automobile operations per year in a given country, using a linear programming optimization technique. The total cost is a weighted sum of the three primary cost areas of each fuel: gross consumer cost (P), environmental cost (E), and indirect costs (I). The weights are comprised of “country priorities,” which is a numerical interpretation of the importance of P, E, and I to that country. The model’s output is the optimal fuel mix a country should have given its unique costs, priorities, and constraints. The model can perform a large number of different scenario analyses, which renders the model ideal for use as a policy analysis tool. The most relevant model finding is that gasoline is not in the portfolio of optimal fuel mixes unless the user places a high weight on minimizing indirect costs. AUTHORS: TEAM 8 Can Ediboglu (ediboglu@seas.upenn.edu) Hande Erfus (handee@seas.upenn.edu) Brandon Hedvat (bhedvat@seas.upenn.edu) Guli Zhu (guliz@seas.upenn.edu) ADVISORS Dr. Peter Scott Mr. Walter Sobkiw DEMO TIMES Thursday, April 22, 2010 9.00 | 9.30 | 10.00 | 15.00 Special Thanks To Mr. Philip D. Farnum Dr. Ken Laker Dr. Raymond Watrous Mathematical Representation of the Model Comparison of Fuel Types LPG Current Price: $3.72/GGE Emissions: 397 grams CO 2 /mile Y2007 Vehicles: 0.06% E85 Current Price: $3.21/GGE Emissions: 381 grams CO 2 /mile Y2007 Vehicles: 0.15% CNG Current Price: $1.86/GGE Emissions: 405 grams CO 2 /mile Y2007 Vehicles: 0.05% B20 Current Price: $2.63/GGE Emissions: 345 grams CO 2 /mile Y2007 Vehicles: 0.16% GASOLINE Current Price: $2.64/GGE Emissions: 474 grams CO 2 /mile Y2007 Vehicles: 69.7% DIESEL Current Price: $2.54/GGE Emissions: 401 grams CO 2 /mile Y2007 Vehicles: 28.8% ELECTRIC Current Price: $1.82/GGE Emissions: 352 grams CO 2 /mile Y2007 Vehicles: 0.02% HYBRID ELECTRIC Current Price: $2.64/GGE Emissions: 343 grams CO 2 /mile Y2007 Vehicles: 1.7% Scenario Analysis Key FindingsSystems Methodology In order to use linear programming to determine an optimal fuel mix, the lifecycle of each alternative fuel must first be evaluated. The main costs associated with each fuel can be grouped into three primary cost areas: gross consumer cost (P), environmental cost (E), and indirect costs (I). The following diagram details the most prominent factors that contribute to each cost field. Many of these variables are interdependent, but when analyzed together, they yield a mix that accounts for the subsystems embedded in each stage of the lifecycle of each fuel: SCENARIO 2: BASE CASE  Weights: P = 33%, E = 33%, I = 33%  CO 2 Emissions: 1.666 billion metric tons  Financial Cost: $437.3 billion Gross Consumer Cost: $393.8 billion Indirect Costs: $43.5 billion –Infrastructure: $4.6 billion –Conversion: $38.9 billion SCENARIO 3: NO FUEL CAP  Weights: P = 33%, E = 33%, I = 33%  No constraint on rate of fuel adoption  CO 2 Emissions: 1.801 billion metric tons  Financial Cost: $432.7 billion Gross Consumer Cost: $390.6 billion Indirect Costs: $42.0 billion –Infrastructure: $8.4 billion –Conversion: $33.7 billion SCENARIO 4: ONLY ALT. FUELS  Weights: P = 33%, E = 33%, I = 33%  No constraint on rate of fuel adoption  No pure gasoline/diesel vehicles  CO 2 Emissions: 1.544 billion metric tons  Financial Cost: $453.2 billion Gross Consumer Cost: $394.1 billion Indirect Costs: $59.1 billion –Infrastructure: $0.0 billion –Conversion: $59.1 billion SCENARIO 5: IMPROVED I.C.E  Weights: P = 10%, E = 10%, I = 80%  Gasoline/Diesel Emissions: -25%  Gasoline/Diesel MPGGE: +25%  CO 2 Emissions: 1.558 billion metric tons  Financial Cost: $500.9 billion Gross Consumer Cost: $495.9 billion Indirect Costs: $5.1 billion –Infrastructure: $5.1 billion –Conversion: $0.0 billion SCENARIO 6: PRO-ENVIRONMENT  Weights: P = 10%, E = 80%, I = 10%  Gasoline/Diesel Price: $10/gallon  Carbon Cost: $50/metric ton  Electric Emissions: -50%  CO 2 Emissions: 1.636 billion metric tons  Financial Cost: $749.3 billion Gross Consumer Cost: $524.7 billion Indirect Costs: $224.6 billion –Infrastructure: $73.8 billion –Conversion: $150.8 billion The scenarios below provide the optimal fuel mix for T = 10 years in the future given the Y2007 mix of fuels and level of infrastructure in the United States. It is assumed that 250 million vehicles will traverse 3.5 trillion miles in at time T.  Scenario 2 (base case) yields the lowest gross consumer cost  Scenario 3 (no fuel cap) yields the lowest overall financial cost  Scenario 4 (only alternative fuels) yields the lowest CO 2 emissions  Scenario 5 (improved I.C.E.) yields the lowest indirect costs In each scenario, changes in assumptions and constraints significantly alter the optimal fuel mix. It is interesting to note that unless the user places a high weight on minimizing indirect costs, gasoline is not part of any optimal fuel portfolio. This result implies that diesel is a better traditional fuel in terms of overall price and environmental emissions. In general, given some user input of assumptions and constraints, usually one or two fuels dominate the optimal fuel mix. Key: MPGGE – Miles Per Gasoline Gallon Equivalent | WTW – Well-to-Wheel (from production to consumption) | I.C.E. – Internal Combustion Engine Red – scenario-specific assumption | Green – Lowest cost in category Gross Consumer Price (P) Price per GGE Subsidies Annual Demand Number of Vehicles Miles Driven Environmental Cost (E) CO2-Equivalent Emissions of Greenhouse Gases (Well-to- Wheel) Cost per Metric Ton of Carbon Miles Driven Infrastructure Costs (I) Cost of Adding or Upgrading Fuel Dispensers Incentives (Tax Credits) Number of Fueling Stations Compounded Growth Rate of Each Fuel UNIVERSITY OF PENNSYLVANIA SCHOOL AND ENGINEERING AND APPLIED SCIENCE Department of Electrical and Systems Engineering Source: Argonne National Laboratory GREET Model