The use of compressed natural gas (CNG) in motor vehicles and its effect on employment and air quality

Abstract

This study measures industrial output, employment and air pollution effects through the use of CNG in motor vehicles by utilizing the Pollution-Related Multiregional Household-Interactive Variable Input-Output (PHVIO) model. The impact analyses are conducted with three consecutive year scenarios of different level of CNG conversion of motor fleet vehicles for the target year, 1991, 1992, and 1993. The use of CNG in bus and truck vehicles of private businesses, consumers, and state and local governments produces the ‘substitution’ effect and ‘income’ effect. The use of CNG reduces the costs of transportation, and the output, employment and air pollution effects of the reduced transportation costs are referred as the substitution effect. The use of CNG increases natural gas consumption and requires CNG duel engine installation while it decrease gasoline consumption. The output, employment and air pollution effects of this final demand change are referred to the income effect. The industrial output and employment effects are measured in Oklahoma and the Rest of the U.S. Then Oklahoma State industrial and employment effects are divided into Oklahoma SMSA, Tulsa SMSA and the Rest of Oklakoma. Finally, the stationary source air pollution due to industrial effects and mobiles source air pollution due to CNG using motor vehicles are measured in Oklahoma SMSA and Tulsa SMSA.