NEW JERSEY DEPARTMENT OF TRANSPORTATION

INCREASE IN FUEL TAX, STATEWIDE

RACM Analysis

Control Measure:

Increase in Fuel Tax

Description:

The current fuel tax is raised in order to provide a negative economic incentive, which is expected 

to alter commuter behavior, encouraging commuters to use alternative modes of transportation. 

According to the American Petroleum Institute’s most recent reports at the time of this analysis 

(July, 2005) the gasoline excise tax in the state of New Jersey was 14.5 cents per gallon (cpg).

Documentation:

 American Petroleum Institute, State Motor Fuel Excise Rates as of July 1, 2005. 

www.api.org

 Department of Energy, Energy Information Administration (EIA), Retail Gasoline Prices:

http://www.eia.doe.gov/oil_gas/petroleum/data_publications/wrgp/mogas_home_page.html

 Center for Clean Air Policy Guidebook: www.ccap.org/guidebook

 U.S. Department of Transportation. “Summary of Fuel Economy Performance,” National 

Highway Traffic Safety Administration, Washington, D.C., March 2005.

 Victoria Policy Institute. “Fuel Taxes, Increasing Fuel Taxes and Fees,” May 9, 2005. 

www.vtpi.org/tdm/tdm79.htm

Methodology:

The total annual and daily affected VMT were calculated. Emission factors, generated using 

MOBILE6.2, were then applied to obtain the emission benefits of increasing the fuel tax 

statewide.

Inputs/Assumptions:

 A 50 cpg fuel tax increase will be applied.

 According to studies conducted by the Victoria Transport Policy Institute, a fuel tax 

increase of 50 cpg can be expected to result in an average decrease in VMT of 4%.

 MOBILE6.2 was used to generate emission factors and VMT.

 An average fuel economy of 25 miles per gallon was assumed.

 Retail gasoline price = $2.40/gallon.

Results:

Total Affected VMT:

Daily: 5,116,135 miles/day

Annual: 1,789,569,054 miles/year
NEW JERSEY DEPARTMENT OF TRANSPORTATION

INCREASE IN FUEL TAX, STATEWIDE

RACM Analysis

Statewide Benefits (Emission Reductions):

Pollutant

Type

Analysis Year 2009

tons/day tons/year

VOC 3.06 NA

NOx 2.89 1,167.97

PM2.5 NA 140.03

SO2 NA 4.50

*Statewide emission benefits include counties not included below

Ozone Analysis – Daily Benefits (tpd) in New Jersey:

Benefits 

(Reductions)

Ozone Non-Attainment Area

NY-NJ-CT PA-NJ-MD-DE

VMT 3,644,892 1,181,392

VOC (Tons/Day) 2.09 0.98

NOx (Tons/Day) 2.07 0.83

PM2.5 Analysis – Annual Benefits (tpy) in New Jersey:

Benefits 

(Reductions)

PM2.5 Non-Attainment Area

NY-NJ-CT PA-NJ-DE

VMT 1,245,311,288 317,499,170

NOx (Tons/Year) 809.59 211.28

PM2.5 (Tons/Year) 113.57 4.32

SO2 (Tons/Year) 1.72 2.60
NEW JERSEY DEPARTMENT OF TRANSPORTATION

INCREASE IN FUEL TAX, STATEWIDE

RACM Analysis

Cost/Benefit Analysis

Total costs were estimated as follows:

Total VMT was divided by 25 mpg and multiplied by the $0.50 cent per gallon tax 

increase. This figure was subtracted from the total affected VMT (4%) divided by 25 

mpg and multiplied by the total amount saved per gallon. The total amount saved per 

gallon was estimated at $2.40 plus the $0.50 increase. These calculations were 

performed using both daily and annual VMT.

Cost Benefit Results:

Nonattainment Area

Ozone ($/tpd)

VOC NOx

NY-NJ-CT $ 670,824 $ 676,819 

PA-NJ-MD-DE $ 464,340 $ 549,353 

Statewide $ 604,972 $ 640,444 

Nonattainment Area

PM2.5 ($/tpy)

NOx PM2.5 SO2

NY-NJ-CT $ 590,672 $ 4,211,192 $ 278,563,708 

PA-NJ-DE $ 577,050 $ 28,222,246 $ 46,919,462 

Statewide $ 587,853 $ 5,091,174 $ 139,072,627