1. Program in Transportation Transportation’s Role in the Climate Challenge Alain L. Kornhauser Professor, Operations Research & Financial Engineering Director, Program in Transportation Princeton University TRANSPORTATION & INFRASTRUCTURE ISSUES for the NEXT DECADE Princeton University, Woodrow Wilson School March 6, 2009

2. Program in Transportation The Climate Challenge It’s a global problem stemming from our fundamental way of life: –The size of our population –Our view on a “standard of living” –The economy that sustains both Transportation is a intermediate good: –Its sole value is the creation of time and place utility while incurring costs for our standard of living –Thus some elements, such as land use, ride sharing, SUVs are primarily standard of living issues Which have been facilitated by Transportation Transportation serves many elements (people, goods) in many ways (modes) –Powered almost exclusively by an inexpensive, highly portable energy source

3. Program in Transportation The Climate Challenge It’s a global problem stemming from our fundamental way of life: –The size of our population –Our view on a “standard of living” –The economy that sustains both

4. Program in Transportation Can Transportation Help? Transportation is a intermediate good: –Its sole value is the creation of time and place utility while incurring costs for our standard of living –Thus some elements, such as land use, ride sharing, SUVs are primarily standard of living issues Which have been facilitated by Transportation Transportation serves many elements (people, goods) in many ways (modes) –Powered almost exclusively by an abundant, inexpensive, highly portable energy source Transportation has helped with similar crises in the recent past: –Air Pollution (1970 Clean Air Act, etc.) Catalytic converters (Legislative mandate) CAFE standards Lead-free gasoline Cleaner engine designs, banning of 2-cycle engines –Essentially all transportation technology related, essentially no standard of living related (land-use, ride sharing)

5. Program in Transportation http://www.eia.doe.gov/emeu/aer/pdf/aer.pdf (10 15 )

6. Program in Transportation Transportation’s Role in the Climate Issue Mostly about consumption of Petroleum –Which can’t be cleaned Must Consume Less –Use more efficiently without reducing standard of living –Create a different abundant, inexpensive, highly portable energy source Hydrogen Clean Electricity (Nuclear, Clean Coal)

7. Program in Transportation How Can Policy Help Creation of –Abundant: Technology investment on Cleaning Coal; Risk absorption with strict regulatory oversight on New Nuclear Power –Portable: Technology investment in energy storage (batteries) –Inexpensive Impose exorbitant Sin Tax on Petroleum Treat it as we’ve treated cigarettes –>$2.575 per gallon ($2.575 per pack in NJ ; leading the nation) –Prohibit advertising of Petroleum powered automobiles –Place in large letters: “Hazardous to your Planet” across the side of every “Hummer” –Allow the parking of any gasoline powered vehicle only at the most distant outer fringes of any parking lot.