What should the government do about petrol prices?
The “hot topic” in the press in Australia at the moment has been centred on what action the Government should take on the current soaring petrol prices. With petrol prices recently rising from $1.30 a litre to over $1.60 in only a few weeks, many Australian families are spending more and more on the family car.
The Federal Government is setting up a FuelWatch scheme to encourage better competition and allow motorists to find the cheapest price. The Opposition is suggesting lowering the excise currently charged on petrol by 5c per litre. Unsurprisingly, each side of politics is quick to point out why their plan is superior!
While both options might offer some minor, short term relief, neither plan seems to offer a long term solution, for two reasons:
Peak Oil
No-one debates that we will eventually run short of oil - the main question is whether it is happening now, in the next 5-10 years or the next 50 years. But as developing countries’ thirst for oil increases, and the amount of oil being pumped decreases, simple supply and demand tells us that the price of oil will skyrocket. In fact, many analysts blame the current high prices on just this.
Unfortunately, all the fuel monitoring schemes in the world won’t effect global demand, and excise cuts will quickly be dwarfed by the price rises. If petrol prices climb to, say, $3.00 per litre, a 5c excise cut will barely be noticeable.
Global Warming
Emissions due to transport are one of the big contributors to carbon dioxide emissions. And as we collectively drive our billions of kilometres every year, those CO2 emissions are contributing to climate change.
Sooner or later, we’re going to need to tackle the transport emissions we produce as a nation. Trying to make petrol more affordable is just a step we’re going to need to reverse sooner or later, down the track.
So, whats a well-meaning, but far-sighted Government to do? At the end of the day, any solution should come down to one simple premise:
Reducing our reliance on petrol.
By reducing our reliance on petrol, we become less affected by changes in the price. It’s like the difference between bread and lemonade - if the price of bread goes sky-high, we’re all affected as we all need to buy bread every week. But if the price of lemonade rises, we’re not that affected - we don’t buy that much of it in the first place.
One of the best ways to do this would be to improve our public transport systems. In many cities, the public transport system is an object of ridicule - “rarely on time”, “never going where you need it”, and “more expensive than just driving the car” are some of the common complaints. But all this could be fixed if more money was spent on our public transport:
- buying more buses, trams and trains
- hiring more drivers, conductors and security
- analysing people’s commuting patterns
- overhauling the transport interchanges and stations
There will always be some occupations that aren’t amenable to public transport, but with an injection of funds, public transport could become a viable, even attractive, form of commuting for many Australians.
A slightly longer term fix is the urban redesign of our cities. Currently, those people who can least afford rises in the cost of petrol tend to live in the outer suburbs and are therefore most affected by price increases. Urban redesign, where people don’t have to drive for an hour each morning just to get to work would help reduce the average families fuel bill. Providing incentives for workplaces like offices and factories to be located closer to the workforce is one possibility. Increasing the number of residential properties near existing workplaces (through the building of units, or land release/rezoning) is another.
There are countless other possibilities. Making alternative commuting options like cycling more attractive is something a number of cities are already exploring. Providing incentives for people to downsize their cars to smaller models, perhaps through registration discounts, is another way to reduce our need for petrol. I’m sure that you could come up with hundreds of other ideas - feel free to share them in the comments!
Politics being what it is, we can expect plenty of airtime over the coming months to be devoted to which side of politics is going to bring the price of petrol down. But, fingers crossed, hopefully our politicians will start to think about how they can help the average Australian’s wallet by reducing our need for petrol in the first place.
(Image courtesy of “Rama”, licensed under the Creative Commons “Attribution ShareAlike 2.0 France” license.)
Categories: automotive, current affairs, efficiency, environment, green, reduce, transport
Tags: car, commute, petrol, public transport, reduce
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