Saturday, March 14, 2009

An Open Letter to the EPA and the Department of Energy

March 14, 2009

Administrator Lisa Jackson
Office of the Administrator
Environmental Protection Agency
Ariel Rios Building
1200 Pennsylvania Ave., NW
Washington, DC 20004

Dr. Stephen Chu
Secretary of Energy
U. S. Department of Energy
1000 Independence Ave., SW
Washington, DC 20585

Dear Administrator Jackson and Secretary Chu,

I am writing to ask you to consider adding gas consumption information to the fuel efficiency information currently provided on automobiles sold in the United States. Currently, as required by law, the EPA provides information on “miles per gallon” (MPG). However, in research published in June, 2008 in Science (Larrick and Soll, "The MPG Illusion," Science, 320 (5883) p. 1593-1594), my co-author and I showed that MPG misleads car buyers when they compare the gas savings available from different cars.

The following table shows gas consumption for vehicles with different levels of MPG over 10,000 miles of driving:

10.0 MPG = 1000 GPM (Gallons per 10,000 Miles)
11.0 MPG = 900 GPM
12.5 MPG = 800 GPM
14.0 MPG = 700 GPM
16.5 MPG = 600 GPM
20.0 MPG = 500 GPM
25.0 MPG = 400 GPM
33.0 MPG = 300 GPM
50.0 MPG = 200 GPM

Because GPM is the inverse of MPG, gas savings declines rapidly as MPG increases. Thus, the largest gas savings come from removing the most inefficient vehicles. Replacing a car that gets 14 MPG with a car that gets 25 MPG reduces gas consumption (and carbon dioxide emissions) more than any possible replacement of a 33 MPG car over the same distance. MPG obscures these savings.

The research in the Science article showed that people tend to subtract MPG when they assess the gas savings of different vehicles. This “linear” thinking creates illusions, leading people to undervalue replacing inefficient cars. Only a measure of GPM can be subtracted.

What can the EPA and the Energy Department do to help consumers? The remainder of this letter suggests possible improvements to the website and the annual Fuel Economy Guide ( which are jointly run by the EPA and the Office of Energy Efficiency and Renewable Energy (EERE) of the Department of Energy.

First, there are two things that the EPA and DOE do not need to do. First, you do not need to explain the MPG Illusion to car buyers, which may not be of interest to many consumers. Second, you do not need to use the acronym “GPM,” which may strike some consumers as unnecessary.

What the EPA and EERE should consider doing is the following:

1) Emphasize clearly on the opening page of the website (and in the Fuel Economy Guide) that consumers should compare the gas consumption of cars, not MPG. Almost all consumers will care about gas consumption. It needs no further justification.

2) Provide consumers with a salient, immediate measure of gas consumption when they examine cars. The measure could be gallons per 100 miles or gallons per 10,000 miles. It could be displayed as a column of data in the Fuel Economy Guide and could be exhibited next to MPG in the car comparison windows on the

Having the option of tailoring the distance to a consumer’s choice is also useful. The following Duke Calculator is a model for this type of information. It allows car buyers to calculate gas consumption for their current vehicle (calculator 1) and compare it to all new 2009 vehicles (calculators 2 and 3):

The current website provides some of this information, but only to a limited extent.

There is an option of switching to gallons per 100 miles—although no explanation is given for why consumers would want to focus on gallons per 100 miles. Because the site never mentions the need to compare gas consumption, few consumers are likely to elect the option.

The website automatically displays fuel consumption per 25 miles for each vehicle. However, the distance is so small that it makes all cars appear very similar in terms of gas consumption. Using a larger base—at least 100 miles, or better, 1,000 miles or 10,000 miles—makes differences in gas consumption between cars clear.

The site also automatically displays a number of annual measures that are linear proxies of gas consumption: Barrels of oil consumed, carbon footprint, and gas costs. These proxies are very useful. However, none of these are effective as a standard, memorable unit of efficiency (i.e., they are not comparable to MPG in terms of how well they "stick"): Barrels and carbon footprint are unfamiliar. Gas costs fluctuate with gas prices so memorizing listed gas costs in the year of purchase (if possible) is uninformative for later car purchase decisions. In contrast to the proxies, gas consumption is intuitive. Like MPG, a standard measure of gas consumption can be remembered and compared across cars and over time.

In sum, you will be helping consumers to make wiser decisions about gas consumption, and carbon dioxide emissions, by providing them with salient information on gas consumption. Please emphasize and make easily available information on gas consumption.


Richard Larrick

Updated: 2:40 pm March 16