Technology Impacts on California Car and Truck Fuel Demand

This paper presents forecasts of future California car and truck fuel demand based on projected economic, demographic, and technologic variables. Vehicle stocks and sales are predicted based on changes of these variables. The paper presents several different cases of market-induced, technical fuel economy improvements. Increased fuel efficiency is projected to reduce fuel demand despite growth in income, population, and vehicle miles traveled. Implementation of relatively inexpensive, post-1985 fuel economy improvements is forecast to reduce 2002 fuel demand 9 percent from 1982 levels, assuming a fuel price escalation rate of 3 percent above inflation. An additional 7 percent reduction appears feasible through refinements in existing technology.