Report Predicts More Use of Diesel as Oil Prices Climb

Findings by the Energy Information Administration indicate that the diesel market will Be 29-percent higher than expected by 2025.

WASHINGTON, D.C. – Allen Schaeffer, executive director of the Diesel Technology Forum, issued a statement today following the release this week of a new report by the Energy Information Administration (EIA), which indicates more high oil prices for U.S. energy markets and a greater than expected increase in U.S. diesel vehicle sales by the year 2030.

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“The Energy Information Administration’s (EIA) release this week of its 2006 Annual Energy Outlook indicates that U.S. consumers will continue to face high oil prices and more pains at the gasoline pump in the years ahead,” Schaeffer says. “Nevertheless, the report also shows that as consumers look for greater fuel economy in their cars, trucks and SUVs, increased efficiency in U.S. light-duty vehicles will be built upon a sharp increase in the sale of diesel and hybrid vehicles.” Schaeffer estimated that 1.3 million diesel vehicles will be purchased annually in the U.S. by the year 2025, according to the EIA report. This represents a 29-percent increase (290,000 more vehicles) over the agency’s 2005 predictions for the same time frame. The full report is available at www.eia.doe.gov/oiaf/aeo/index.html.

According to EIA, diesel offers a 20- to 40-percent greater fuel efficiency over comparable gasoline engines, which could help reduce dependence on foreign oil. The U.S. Department of Engergy estimates that a 30-percent market penetration of diesel vehicles by 2020 would reduce U.S. net crude oil consumption by 350,000 barrels daily. Congress has recognized the energy-saving benefits of clean diesel during the summer by passing new tax incentives up to $3,400 for consumers purchasing advanced clean diesels starting in 2006. EIA expects this incentive to spur the growth of diesel in America.

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Recent survey suggest that American drivers already are turning to diesel-powered vehicles. A 2005 analysis of data from R.L. Polk & Co. shows that annual registrations of new diesel passenger vehicles in the U.S. has grown from 301,000 in 2000 to nearly 470,000 in 2004 – a 56 percent increase. GIE Media’s Snow magazine, sister publication of Lawn & Landscape, has recently surveyed its readership on the use of diesel vehicles in their companies.

According to the research, many snow contractors are considering the switch to diesel-powered vehicles to lessen the financial blow of fuel prices, which jumped to more than $3 per gallon at some points in 2005. In past years, the split between the use of diesel vs. gas-powered vehicles has been about 65/35, in favor of gas. However, recent research shows fleet composition is now 60-percent gas and 40-percent diesel. In contrast, Canadian contractors run fleets comprised of 75 percent diesel and 25 percent gas-powered vehicles, according to Snow magazine research.  

Concurrent with rising sales of diesel vehicles has been a greater availability of diesel fuel at local filling stations. According to a recent report commissioned by the Diesel Technology Forum and released last spring, diesel is now available at nearly half (42 percent) of fueling service stations across the country – a 12 percent increase from EPA estimates released in 2000. However, the AAA Daily Fuel Gauge report today is showing diesel at a national average price of $2.56 per gallon, compared to regular unleaded gasoline, with a national average price of $2.21.

“As more consumers become aware of the increasing availability and energy-saving benefits of these vehicles, we can expect that the popularity of light-duty diesels in the U.S. will continue to grow,” Schaeffer says. Consumers interested in learning more about diesel cars, trucks and SUVs can visit the Forum’s web site at www.dieselforum.org for a complete list of the light-duty diesel vehicles available in the U.S. and additional information on the environmental, economic and energy conversation benefits of modern clean diesel technology.

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