Alternative Fuels and Vehicles Cost-Competitive
The increase in the prices of major fuels, like gasoline and diesel fuel products is a major global problems recently. Those prices are increase associated with the global economic crisis. Now, it is the ideal time to move all the focus and effort to alternative fuels for vehicles. There are different types of alternative energy sources for fuel to choose from. But the hard fact is that the areas of alternative fuels have not passed many real qualitative and quantitative surveys and breakthrough research. The air pollution caused by fossil fuels above and the ever changing prices fluctuation of these fuels is the ideal situation for some basic research on alternative routes.
Natural-gas-derived fuels are the most cost-competitive because natural gas does not need to be refined like gasoline and diesel fuel from petroleum. Ethanol, a heavily subsidized alternative fuel, is not as cost-competitive as natural-gas-derived fuels. If not for the subsidies and environmental implications regulations requiring oxygenates, ethanol would not be used at all. The chances of ethanol ever becoming cost-competitive in the free market are slim since extensive land is needed to raise high-energy-yield plants for fuel, and the energy that must be expended to raise, harvest and dry the plants for the fermentation alcohol results in a low net energy yield.
When gasoline-powered automobiles are modified to burn a fuel such as ethanol alone, they are known as dedicated ethanol vehicles—risky investments for buyers who have concerns about future availability. For example, Brazil’s Proalcool program promoted and heavily subsidized ethanol, and thus dedicated ethanol vehicles, from 1975 to 1988. Once the subsidies were curtailed and then eliminated (estimates of the costs of the subsidy to the government range from $7 to $10 billion), shortages resulted. Many of the owners of ethanol-dedicated vehicles either had to junk or retrofit the vehicles to run on gasoline, and the sales of ethanol-dedicated vehicles went from 50 percent of the market in 1988 to 4 percent by mid-1990.
Aside from the difference in fuel costs, the cost of redesigning and equipping vehicles engines and fuel tanks to run on alternative fuels has to be considered. Responding to the desire to switch fuels for cost reasons, or refueling security when the alternative fuel is not readily available, several auto makers offer flexible fuel vehicles that run primarily on compressed natural gas, but also reducing gasoline when compressed natural gas is not available. These vehicles are sold at a premium and have shown little success in attracting buyers since low fuel prices ensure their return on investment will be poor in comparison to standard gasoline vehicles.