Gas Should Cost $9.50 a Gallon

Gas Should Cost $9.50 a Gallon

May 24 2023

What if we started charging everybody who burns gas/diesel in their vehicle for the cost of pulling their CO2 emissions out of the atmosphere and sticking it back in the ground? We are going to eventually have to do that as total CO2 emissions are still going up from virtually all sources and we’re on track for a rise in temps of over 5 degrees Fahrenheit.

If we had started decades ago to cut fossil fuel emissions, we might have been able to avoid having to capture CO2 molecules already in the atmosphere and sequestering them back into the earth’s surface. While there are all sorts of ways to cut carbon emissions at their source, we are well past JUST limiting current emissions. There are agricultural methods, like growing trees, that can also perform direct air capture and we’ll pursue them. The problem is we are on path to send 50 Billion tons of emissions into the atmosphere for years to come and will, eventually, need to pull back 10 Billion tons per year — at a minimum. Trees don’t get it done.

We have a rough idea what this direct air carbon capture is going to cost. 60 Minutes did a story last month on the two biggest direct air capture and sequestration projects in the world. The one facility up and running is in Iceland. It pushes air through filters and extracts the CO2 molecules and then uses a chemical process to turn that CO2 into rock. It can capture 4,000 tons of C02 per year at a cost of about $800 a ton. The second, and more consequential project, is an Occidental Petroleum/Carbon Engineering project at the King Ranch in Texas. Construction has started; when finished it should be able to capture and sequester 500,000 tons per year at an unsubsidized cost of $600 a ton. (BTW, We’d need 20,000 of these facilities to suck up 10 Billion tons of CO2 per year.)

Using a $600 a ton estimate, it would cost $6 a gallon to sequester the CO2 produced from a gallon of gasoline. Right now, gas costs about $3.50/gallon, so $3.50 + $6 = $9.50. Nobody’s going to be paying the extra $6 a gallon for the foreseeable future but you can count on the fact that we’ll have to pay eventually. While costs will come down as carbon capture projects scale up, it’s going to be tough to get below $500 a ton, which translates to an additional $5 a gallon.

We recently reported that the true cost of ownership of EVs is already 20% less than the cost of ICE vehicles. If we add six bucks to the price of gas for ICE vehicles, the EVs are closer to half the cost of ownership.

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