Office of Transportation and Air Quality

EPA-420-R-11-014

September 2011

Potential Changes in Emissions 

Due to Improvements in Travel 

Efficiency –

Supplemental Report: 

Analysis of Potential Co-Benefits
EPA-420-R-11-014

September 2011

Transportation and Climate Division

Office of Transportation and Air Quality

U.S. Environmental Protection Agency

Prepared for EPA by

ICF International

EPA Contract No. EP-C-06-094

Work Assignment No. 4-09

Potential Changes in Emissions 

Due to Improvements in Travel 

Efficiency –

Supplemental Report: 

Analysis of Potential Co-Benefits
iii

TABLE OF CONTENTS

1. INTRODUCTION ....................................................................................................................... 1

2. BACKGROUND/CONSIDERATION OF EXISTING RESEARCH .......................................................... 4

3. ANALYSIS METHODOLOGY ....................................................................................................... 5

3.1. Benefit/Social Cost Measures Identified for Quantification ....................................................... 5

3.2. Resources for Data and Assumptions....................................................................................... 7

3.3. Methodology for Calculating Co-Benefits .................................................................................. 9

4. RESULTS AND CONCLUSION...................................................................................................11

4.1. Results from Analysis of Co-benefits ...................................................................................... 11

4.2. Indirect Benefits....................................................................................................................... 13

4.3. Conclusion............................................................................................................................... 13

REFERENCES .............................................................................................................................14

APPENDIX ..................................................................................................................................16

LIST OF TABLES

Table 1. Summary of Daily Co-Benefits from Implementing Scenarios........................................................ 2

Table 2. Proposed TEAM Methodology for Measures Quantifiable in TRIMMS .......................................... 6

Table 3. Assumptions Used in the Analysis of Co-Benefits.......................................................................... 9

Table 4. Estimated Values for Fuel Prices and Fuel Economy Used in the Analysis, 2010-2050 ............... 9

Table 5. Co-Benefits Resulting from Daily Reduction in Vehicle Miles Traveled (discounted @ 3%) ....... 12

Table A-1. Methodology Used to Estimate Co-Benefits in TRIMMS .......................................................... 16

Table A-2. Co-Benefits Resulting from Daily Reduction in Vehicle Miles Traveled (discounted @ 7%).... 17

LIST OF FIGURES

Figure 1. Daily Vehicle Operating Cost Savings Resulting from Implementing Scenarios, 2010-2050, 

compared to Business-as-Usual scenario .................................................................................................... 3
iv

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1 

1. Introduc tion 

The EPA report, Potential Changes in Emissions Due to Improvements in Travel Efficiency – 

Final Report, analyzed the impacts of combinations of travel demand management, land use, 

transit, and road pricing strategies on trip making, vehicle miles traveled (VMT), and vehicle 

emissions using the Travel Efficiency Assessment Method (TEAM).1

 The analysis 

demonstrated potential reductions in vehicle trips and trip lengths, shifting of trips from peak to 

off-peak periods, and travelers’ shift from single occupancy vehicles to transit, ridesharing, and 

non-motorized modes. The analysis was done for urban areas; hence, the reductions in VMT 

and emissions represent those occurring from changes in urban travel activity. Data collected 

for the previous study was obtained from urban areas and the strategies analyzed are also most 

applicable in urban areas facing issues such as peak period congestion and associated air 

pollution and greenhouse gas emissions. Rural areas are not expected to be affected by these 

strategies.

A primary benefit of the changes in travel activity occurring from the analyzed strategies is a 

reduction in emissions due to reduced travel and reduced congestion, but there are several 

other ancillary benefits. In this supplemental report, these ancillary benefits are referred to as 

co-benefits because they are additional to the emissions benefits resulting from the 

implementation of the travel efficiency strategies or combinations of strategies (referred to as 

scenarios) described in the EPA report.

The co-benefits from implementation of these scenarios include a reduction in health impacts

associated with air pollution, reduced traffic congestion, reduced user costs for operating 

vehicles, improved energy security through reduced energy costs and dependency on oil 

imports, and reduction in vehicle crashes and accidents. When co-benefits are accounted for, 

transportation strategies aimed at reducing emissions show additional positive impacts. 

Therefore, it is important to carefully consider co-benefits in terms of their present value when

evaluating strategies or scenarios for implementation.

This supplemental report focuses on the potential co-benefits resulting from the seven scenarios 

analyzed in the EPA report. Although there are several potential co-benefits, the national level 

results for potential reductions in VMT and emissions from the previous analysis were used to 

quantify two key co-benefits that are straightforward to quantify. As with the VMT and 

emissions reduction, the co-benefits were quantified on a daily basis for each decade from 2010 

out to 2050 for each scenario and discounted to their value in 2010 dollars. The White House 

Office of Management and Budget (OMB) provides guidance on discount rates to assume, 

recommending the use of 3% and 7%. The guidance states that when regulation primarily and 

directly affects private consumption (e.g., through higher consumer prices for goods and 

services) rather than the allocation of capital, the lower discount rate of 3 percent is appropriate. 

The calculations are therefore, shown using a 3 percent discount rate. Nevertheless, following 

OMB’s overall guidance, the Appendix of this report (Table A-2) also includes co-benefits 

calculated at the higher discount rate of 7%. The co-benefits estimated in this report are: 

1) Vehicle operating cost savings – If vehicle owners make fewer trips and drive shorter 

distances, their vehicle maintenance and operation costs can be reduced. In total, the 

seven scenarios analyzed in the EPA report are expected to result in light duty vehicle 

 

1 U.S. Environmental Protection Agency (EPA). (2011). Potential Changes in Emissions Due to 

Improvements in Travel Efficiency – Final Report. EPA-420-R-11-003. March. Available at: 

http://www.epa.gov/oms/stateresources/policy/420r11003.pdf
2 

operating cost savings ranging from about $8.5 million to over $282 million in 2050 in 

2010 dollars, using a 3% discount rate.

2

Savings in fuel costs – Less fuel consumed means travelers pay less at the pump. This 

is a component of vehicle operating cost savings but is calculated separately because it 

is of particular interest. Not only is it the component of operating costs that is typically 

most directly observed by travelers, but there is often a lot of uncertainty surrounding 

fuel costs in future years. This depends on a multitude of economic and political factors 

out of the scope of this discussion. The seven scenarios are expected to result in fuel 

cost savings for light duty vehicles ranging from $1.4 to $48 million in 2050 (2010 

dollars, using 3% discount rate). 

2) Gallons of fuel saved – Strategies aimed at reducing transportation emissions are also 

likely to reduce fuel consumption, both from reduced VMT and from vehicles spending 

less time in congested conditions (which leads to excess fuel consumption due to idling). 

The seven scenarios are expected to result in fuel savings ranging from about 0.85 to 28 

million gallons in 2050.

The summary results from the analysis of co-benefits for each scenario in 2030 and 2050 are 

shown in Table 1. The baseline year for the previous analysis is 2010 and therefore, all cobenefit values in this report are presented in 2010 dollars. The co-benefits of vehicle fuel and 

operating cost savings were estimated for each future year on a daily basis and then discounted 

at the rate of three percent to derive the net present value. Figure 1 shows the daily vehicle 

operating cost savings resulting in each mentioned year from implementation of each of the 

seven scenarios, as compared to a business-as-usual baseline.

The analysis uses data widely available from public databases and literature and is based on 

standard assumptions followed in cost-benefit analysis studies and existing research on the 

analysis of co-benefits. The following sections of the report describe the data, assumptions, 

methodologies, and results for the analysis of co-benefits based on the outputs of the TEAM 

approach used to estimate travel activity and emission reductions in the previous EPA report, 

Potential Changes in Emissions Due to Improvements in Travel Efficiency – Final Report. 

 

2 White House Office of Management and Budget’s Circular A-4 provides guidance on discount rates (pp 

31-35), recommending the use of 3% and 7%; available at:

http://www.whitehouse.gov/sites/default/files/omb/assets/regulatory_matters_pdf/a-4.pdf
3 

Table 1. Summary of Daily Co-Benefits from Implementing Scenarios

Co-Benefits

2030 2050

Scenario

Vehicle operating 

cost savings 

($ millions)*

Fuel savings 

(million gallons)

Vehicle operating 

cost savings 

($ millions)*

Fuel savings 

(million gallons)

1- Region-wide TDM $2.84 0.27 $8.43 0.85

2 - TDM + land use changes $29.38 2.79 $94.75 9.51

3 - TDM + land use changes + 

transit fare reduction $40.63 3.86 $133.72 13.42

4 - TDM + land use changes + 

transit fare reduction + transit 

service improvements

$42.25 4.02 $139.23 13.97

5 - TDM + land use changes + 

transit fare reduction + transit 

service improvements + parking 

fees

$84.86 8.06 $222.37 22.31

6 - TDM + land use changes + 

transit fare reduction + transit 

service improvements + mileage 

fees

$56.65 5.38 $202.57 20.32

7 - TDM + land use changes + 

transit fare reduction + transit 

service improvements + parking 

fees + mileage fees

$99.36 9.44 $281.80 28.28

* All values in 2010 dollars

Figure 1. Daily Vehicle Operating Cost Savings Resulting from Implementing Scenarios, 2010-2050, compared to 

Business-as-Usual scenario

Scenario 1

Scenario 2

Scenario 3

Scenario 4

Scenario 5

Scenario 6

Scenario 7

$0.00

$50.00

$100.00

$150.00

$200.00

$250.00

$300.00

2010 2020 2030 2040 2050

Vehicle Operating Cost Savings in Millions of 

2010 Dollars
4 

2. B ackground/C ons ideration of E xis ting R es earc h

The study began with a review of current national research on the co-benefits resulting from a 

wide range of strategies aimed at reducing transportation emissions. The literature review 

considered several major reports: Multi-pollutant Emissions Benefits of Transportation 

Strategies (FHWA 2006), Growing Cooler (Ewing et al. 2008), Moving Cooler: An Analysis of 

Transportation Strategies for Reducing Greenhouse Gas Emissions (Cambridge Systematics 

2009), and NCHRP Report 462 Quantifying Air Quality and Other Benefits and Costs of 

Transportation Control Measures (2001). 

The literature review identified a range of benefits3

 Change in travel costs (time and out-of-pocket costs): traveler cost/benefit

or cost savings estimated as part of studies 

focusing on measures to reduce vehicle miles traveled (VMT) and/or emissions. Costs and 

benefits can be experienced either by travelers themselves or can be imposed by travelers on 

the rest of society. The latter are considered social costs/benefits, or externalities, because 

they are external to the traveler’s experience and are typically ignored by travelers when making 

travel decisions. The benefits or cost savings most commonly estimated are listed below as well 

as whether they perceived by the individual traveler or by society: 

 Change in fuel consumption costs: traveler cost/benefit

 Change in accident and crash costs: traveler and social cost/benefit

 Change in costs of congestion delays caused to others: social cost/benefit

 Change in health costs related to air pollution: social cost/benefit

 Change in costs of damages related to global climate change: social cost/benefit

 Change in noise costs: social cost/benefit

Other benefits that are not typically considered because they are either not applicable in all 

cases or are difficult to quantify are the costs of land (e.g., for parking), economic costs/benefits 

associated with changes in travel demand (e.g., change in property values, which results in 

higher property tax revenue for jurisdictions), and the economic costs of fuel consumption and 

imports (e.g., fuel cost subsidies to keep prices low and costs of maintaining the Strategic 

Petroleum Reserve to cushion the economy in case of interruptions in fuel supply). A qualitative 

discussion of some of these measures is included later in this report. EPA’s final rule on Light 

Duty Vehicle GHG Emissions Standards includes quantitative estimates of energy security 

benefits from fuel savings that the reader can refer to for further analysis.4

 Lifecycle costs and 

benefits associated with the production and distribution of vehicles and fuels are typically not 

considered in transportation demand analyses.

 

3 Savings in cost measures such as health costs or congestion costs are the same as benefits, i.e. 

negative values for costs imply positive benefits of the same magnitude. 4 U.S. Environmental Protection Agency, 40 CFR Parts 85, 86, and 600; U.S. Department of 

Transportation, National Highway Traffic Safety Administration, 49 CFR Parts 531, 533, 536, 537 and 

538 [EPA–HQ–OAR–2009–0472; FRL–9134–6; NHTSA–2009–0059], “Light-Duty Vehicle Greenhouse 

Gas Emission Standards and Corporate Average Fuel Economy Standards; Final Rule,” published on 

May 7, 2010, available at: http://edocket.access.gpo.gov/2010/pdf/2010-8159.pdf
5 

3. Analys is Methodology 

This section describes the benefits identified for the analysis that could be quantified based on 

the values of VMT and emissions reduction from each scenario estimated in the previous 

analysis.

5

3.1. Benefit/Social Cost Measures Identified for Quantification 

 The benefits for each decade from 2010 to 2050 are calculated on a daily basis and

presented in current (2010) dollars.

In the EPA report, the reductions in VMT were estimated using the TRIMMS (Trip Reduction 

Impacts for Mobility Management Strategies) model. The analysis associated with the EPA 

report used regional data as inputs to the TRIMMS model in order to test scenarios and 

determine potential VMT reductions from each. In order to apply the results to a national-level 

view, regional outcomes were applied to similar regions across the country and then aggregated 

to illustrate national results. 

Although TRIMMS can analyze co-benefits associated with calculated VMT and emissions 

reductions in each region, these regional results from TRIMMS were not directly used for the 

present national scale analysis. The TRIMMS model is designed for analysis at a project or 

regional scale at the start of the analysis and the user must select a region from 85 regions 

represented in TRIMMS. In calculating benefits and costs, the model uses region-specific data 

on wage rates to determine values of time, data on average speeds to determine congestion 

costs, and state-level data on fatality rates to calculate vehicle crash costs for each region. 

TRIMMS also scales the costs to account for cost of living differentials between regions. 

Although these underlying assumptions within TRIMMS make it inappropriate for the present 

analysis, the methodology and data sources referenced provide some guidance for the 

calculation of costs and benefits. This analysis relied on assumptions suited to a national 

analysis, but users may follow the methodology described here with regional values for 

assumptions such as fuel prices and auto operating costs. 

Table 2 shows the full list of benefit/cost measures that can be estimated by the TRIMMS model 

along with a brief description of each measure and the proposed methodology to support the 

TEAM analysis. The methodology describes the calculations and data sources that may be 

used to quantify each of the avoided costs, based on the VMT and emissions reductions already 

calculated. While being guided by the methodology used in TRIMMS, this analysis used

updated cost values available from literature and various national databases to apply to the 

national reductions in VMT and emissions previously calculated.6

Change in vehicle operating costs is the only direct user benefit in the list that accrues to 

travelers themselves; all others are social benefits.

The methodology used for 

each measure in the TRIMMS model is shown in the Appendix.

 

5 See EPA report, Potential Changes in Emissions Due to Improvements in Travel Efficiency – Final 

Report, available at: http://www.epa.gov/oms/stateresources/policy/420r11003.pdf 6 Note that while regional analyses using the TEAM approach could rely on TRIMMS, the TEAM approach 

and the methodologies described here allow regions to use more up-to-date emissions, travel, and cost 

data than is available in TRIMMS.
6 

Table 2. Proposed TEAM Methodology for Measures Quantifiable in TRIMMS

Measure Description Proposed TEAM Methodology

Savings in

Vehicle 

Operating Costs

Costs of vehicle ownership, 

operations, and maintenance

Auto operating cost savings from reduced VMT can be 

calculated based on available values in $/mile for the 

current year (2010 in this analysis). 

Savings in Health 

Damage Costs 

Due to Air 

Pollution

Costs of damage to human health, 

visibility, materials, agriculture, and 

forests from vehicle exhaust 

emissions, including CO, VOCs, 

and NOx

Emission factors from EPA’s MOVES model can be 

applied to the change in national VMT to calculate total 

reduction in emissions for a range of pollutants. 

Emissions damage costs in $/kg obtained from EPA 

(2010) can be used to quantify benefits.7

Reduction in

Congestion

Delays

Costs associated with congestion 

delay produced by motor vehicle 

use, i.e., the added delay imposed 

on all users when an additional 

vehicle is introduced into the traffic 

stream. These costs only pertain 

to the costs of added delay to 

others. 

Marginal added hours of delay per thousands of 

passenger‐car equivalent (pce) VMT (assumed to be 

61.26 hours of delay per 1,000 pce VMT in TRIMMS) x 

change in VMT estimated x value of time ($/hour = 40% 

of national average wage rate

Note: Can also be calculated using EPA’s estimates of 

external costs of congestion from EPA (2010). 

Reduction in

Excess Fuel 

Consumption

Costs of excess fuel consumed as 

a result of added congestion

National average fuel economy data from EPA and 

average fuel price available from the EIA can be used to 

estimate the benefits from savings in fuel consumed 

based on the calculated VMT reduction. 

Reduction in 

Impacts from 

Global Climate 

Change

Costs related to damages 

associated with global climate 

change

Emissions factors for CO2, N2O and CH4 from MOVES 

can be applied to the change in national VMT. 

Comprehensive GHG cost values in $/ton available 

from EPA (2010) can be used to quantify benefits.

Reduction in 

Costs Related to 

Accident s and 

Crashes 

Costs associated with crashes, 

such as property and personal 

injury damages caused by

accidents 

The change in comprehensive health and safety costs 

is based on the change in the number of vehicle 

crashes resulting from each scenario. This can be 

calculated using NHTSA data on average national crash 

rates by severity class per million VMT. NHTSA 

guidance on cost factors for crashes in different severity 

classes can be used to quantify benefits. Estimates for 

external costs of accidents are also available from EPA 

(2010).

Reduction in 

Noise Pollution

Costs of damage imposed on 

others through noise from engine 

acceleration and vibration, from tire 

contact on road surfaces, and from

brake and horn usage

Average noise costs for urban areas in $/VMT available 

from EPA (2010) can be multiplied by total national 

reduction in VMT to quantify benefits.

 

7 See EPA Rule “Light-Duty Vehicle Greenhouse Gas Emission Standards and Corporate Average Fuel 

Economy Standards; Final Rule,” published on May 7, 2010 (values available in Table II.F-2), available 

at: http://edocket.access.gpo.gov/2010/pdf/2010-8159.pdf
7 

In this analysis, the following key co-benefits were estimated for each scenario:

1) Vehicle operating cost savings: A reduction in trip-making and VMT is likely to reduce 

vehicle operating costs for ownership, operations, and maintenance, resulting in savings for 

travelers. These costs encompass fuel costs, which were also separately calculated.

Savings in fuel costs: On average, about twenty percent of total auto operating costs are 

attributable to fuel costs,

8 therefore, a reduction in vehicle travel and VMT is likely to result 

in fuel cost savings that are measured as a co-benefit. In projecting fuel costs in future 

years, a greater or lower proportion of total costs may represent fuel. These cost savings

may be considered a component of the total savings in vehicle operating costs.

2) Gallons of fuel saved: Strategies aimed at reducing transportation emissions are also likely 

to reduce fuel consumption resulting from vehicle operations overall and particularly when 

vehicles are operated in congested conditions. These fuel savings are measured as a cobenefit to society. The full range of benefits associated with reduced fuel consumption is not 

quantified here, but some of the related indirect benefits are discussed qualitatively in the 

results section. To quantify the energy security benefits related to fuel savings, the reader 

may refer to EPA (2010) for estimates of the economic benefits from reducing oil imports.

The above two co-benefits were selected for analysis because they are straightforward to 

calculate and because there is generally less uncertainty in estimating these co-benefits than 

the others listed. 

3.2. Resources for Data and Assumptions

This section describes the resources that were used to analyze the above illustrative cobenefits. 

Vehicle operating and fuel costs. Three primary resources support the determination of 

vehicle operating cost savings: (i) Standard Mileage Rate from the Internal Revenue Service 

(IRS) set every year by the federal government and reflecting actual operating costs,

9 (ii) 

estimates of operating costs broken down by cost category from annual publication “Your 

Driving Costs” published by the American Automobile Association (AAA) since 1950,10 and (iii) 

growth rates in fuel prices based on projections in the U.S. Energy Information Administration 

(EIA)’s Annual Energy Outlook (AEO) published annually.11

Either the IRS or AAA values may be used as the assumption for actual vehicle operating costs. 

The advantage of the AAA resource is that the operating costs are broken down in detail by cost 

category and ranges are provided for different types of vehicles (small, medium, and large 

sedans, minivans and sport utility vehicles) along with average values. In addition, ranges of 

costs are provided for different levels of mileage driven in a year (10,000 miles, 15,000 miles, 

and 20,000 miles). This allows the user to identify particular cost categories they are interested 

in for a detailed analysis. Similarly, for a regional analysis, the user may refer to the AAA 

 

 

8 AAA (2010), “Your Driving Costs”; available at: 

http://www.aaaexchange.com/Assets/Files/201048935480.Driving%20Costs%202010.pdf 9 IRS Standard Mileage Rate, 2010; http://www.irs.gov/newsroom/article/0,,id=216048,00.html 10 AAA (2010), “Your Driving Costs”; available at: 

http://www.aaaexchange.com/Assets/Files/201048935480.Driving%20Costs%202010.pdf 11 AEO (2011) projections for motor fuel and diesel prices are available at: 

http://www.eia.gov/forecasts/aeo/topic_prices.cfm
8 

resource for national average values of ownership and maintenance costs, while substituting 

actual fuel costs for their region.

The IRS mileage rate simply provides an average composite value that reflects the combined 

fixed and variable costs of vehicle ownership, operation, maintenance, repair, depreciation, and 

insurance. The most common use of this mileage rate is to reimburse employees for expenses 

involving use of their own cars for business purposes. The reimbursement rate applies to the 

broadly defined term "cars," which includes passenger vehicles, sports utility vehicles or SUVs, 

vans, and pickup trucks. The rate is also provided separately for three categories: business 

miles, medical/moving, and miles driven in the service of charitable organizations. The 

business miles category is applicable in this analysis. The IRS revises the rate annually and 

sometimes more than once per year if a particular component of the operating costs changes 

significantly. In the year 2010, the IRS mileage rate was 50 cents per mile. 

In this analysis, the IRS rate of 50 cents per mile in 2010 was selected since it is a widely used 

value for vehicle operating costs. Prior to conducting this analysis, the AAA values were 

compared with the IRS value. The costs reported by AAA in its 2010 publication range from 

47.6 to 73.9 cents per mile depending on the vehicle type and annual mileage driven. The total 

costs per mile for an average-sized sedan driven about 15,000 miles per year are estimated by 

AAA to be 56.6 cents. Because the AAA rate is close to the IRS rate of 50 cents per mile, it 

supports this reasonableness of the selected rate. 

The AEO is primarily useful in projecting operating costs in future years as it provides fuel price 

projections out to 2035. In this analysis, the 2009-2035 growth rate in fuel prices was used to 

project fuel costs in 2040 and 2050.

12

Fuel consumption. The analysis of fuel savings is based on data from the U.S. EPA on 

average light duty vehicle fuel economy. Future year fuel savings are based on projections from 

the AEO on how average light duty vehicle fuel economy is expected to grow. The annual 

growth rate for vehicle fuel economy from the AEO projects improvements in fuel economy out 

to 2035. Again, the growth rate from 2009 to 2035 was assumed to determine average fuel 

economy in 2040 and 2050.

The non-fuel components of auto operating costs were 

assumed to grow with inflation. The inflation rate for the period 2009-2035 was assumed to be 

2.2. percent per year, based on the assumptions used in the AEO.

Table 3 shows the assumptions used in the analysis and Table 4 shows the estimated values 

for fuel prices and fuel economy used for the analysis of co-benefits in future years.

 

12 AEO (2011) projections for motor fuel and diesel prices are available at: 

http://www.eia.gov/forecasts/aeo/topic_prices.cfm
9 

Table 3. Assumptions Used in the Analysis of Co-Benefits

Assumptions Value Unit Source

Calculating change in vehicle operating and fuel costs

Auto operating costs including 

ownership costs, 2011

50.0 cents/mile IRS Standard Mileage Rate, 2010

Average annual inflation rate for 

2001-2011

2.20% per year EIA, AEO 2011 Assumption

Calculating change in fuel consumption separately

Average light duty vehicle (LDV) 

fuel economy in 2010

22.4 miles/gallon EPA, Light-Duty Automotive 

Technology, Carbon Dioxide 

Emissions, and Fuel Economy Trends: 

1975 Through 2010

Average LDV fuel price in 2010 $2.70 per gallon EIA, Average US gas price in 2010

Growth rate in fuel economy 0.72% per year EIA, AEO 2011 average fuel economy 

growth rate for diesel and gasoline 

light duty vehicles

Growth rate in fuel price 1.80% per year EIA, AEO 2011 for motor fuel

Table 4. Estimated Values for Fuel Prices and Fuel Economy Used in the Analysis, 2010-2050

(in 2010 dollars)

Measure 2010 2020 2030 2040 2050

Average fuel economy in miles per gallon 22.40 24.07 25.86 27.78 29.85

Average fuel price per gallon $2.70 $3.23 $3.86 $4.61 $5.51

Average fuel cost per mile $0.12 $0.13 $0.15 $0.17 $0.18

Average non-fuel costs (ownership, etc.) per mile $0.38 $0.47 $0.59 $0.73 $0.91

Total operating costs per mile $0.50 $0.61 $0.74 $0.89 $1.09

3.3. Methodology for Calculating Co-Benefits

Based on the resources and assumptions described in the previous section, the illustrative cobenefits were calculated using the following methodologies.

1) Vehicle operating cost savings: 

In the analysis, light duty vehicle operating costs in 2010 were assumed to be 50 cents per 

mile, based on the IRS rate.

13

 

13 IRS Standard Mileage Rate for 2010; http://www.irs.gov/newsroom/article/0,,id=216048,00.html

 The VMT reduction for each scenario obtained from the 

earlier TRIMMS analysis was multiplied by the total per-mile operating costs to estimate the 

savings in vehicle operating costs resulting from each scenario. Vehicle operating costs 

were assumed to grow in each year based on the expected growth in fuel prices in future 

years and assuming that other costs (such as costs of ownership including licensing and 

registration costs, depreciation, taxes, and insurance, as well as costs of tires and 

maintenance) will increase with inflation. Using the cost components from AAA, fuel costs 

represent roughly 20-25 percent of total auto operating costs, while insurance coverage, 
10

licensing and registration taxes, depreciation, and finance charges cover the remaining 75-

80 percent. This analysis used the growth rate in fuel economy and expected growth rate in 

fuel prices available from the U.S. Energy Information Administration (EIA)’s Annual Energy 

Outlook (AEO) 2011.14 Total auto operating costs in future years were estimated using these 

data and an average annual inflation rate of 2.2 percent for the non-fuel costs, based on 

assumptions in the AEO. 

Savings in fuel costs: 

The baseline average gasoline price in the U.S. is assumed to be $2.70 in 2010 based on 

data available from the Energy Information Administration (EIA).15 Prices for gasoline and 

diesel are assumed to be the same to simplify the analysis.16 The AEO projects an average 

annual growth rate of 1.8% in prices of both fuels for the period 2009-2035.17 This analysis 

assumes the same growth rate out to 2050 to estimate fuel prices in miles per gallon for 

each future decade. Savings in fuel cost were obtained by multiplying the fuel price by the

gallons of fuel saved calculated in the second co-benefit. These costs may be considered a 

component of the total savings in vehicle operating costs calculated above.

2) Gallons of fuel saved

Data from the U.S. Environmental Protection Agency (EPA) show that the average light duty 

vehicle fuel economy in the year 2010 was 22.4 miles per gallon.

18 For the baseline year 

(2010), the reduction in fuel consumption was calculated by dividing the reduction in VMT by 

the fuel economy in that year. The 2011 AEO assumes that the fuel economy of light duty 

vehicles will grow annually by 0.72% on average for diesel and gasoline-fueled vehicles.

19

This growth rate was applied to estimate light duty vehicle fuel economy for all decades out 

to 2050. As for the baseline year, gallons of fuel saved in all decades were calculated using 

the reduction in VMT and fuel economy estimates.

 

14 U.S. EIA, Annual Energy Outlook (AEO) 2011, table titled “New Light-Duty Vehicle Fuel Economy, 

Reference Case (miles per gallon)” 

15 U.S. Energy Information Administration (EIA), Gasoline and Diesel Fuel update, 07/25/11; available at: 

http://www.eia.gov/oog/info/gdu/gasdiesel.asp 16 The price of diesel is about 0.25 cents per gallon higher than gasoline; however, accounting for the 

different prices of both fuels would require data on vehicle population fueled by each. This difference 

between diesel and gasoline prices was ignored to simplify the analysis. 17 U.S. EIA, Annual Energy Outlook (AEO) 2011, table titled “Petroleum Product Prices in 2009 dollars 

per gallon”. 

18 U.S. EPA (2010). Light-Duty Automotive Technology, Carbon Dioxide Emissions, and Fuel Economy 

Trends: 1975 Through 2010; available at: http://www.epa.gov/oms/fetrends.htm#archive 19 Average fuel economy growth rate for diesel and gasoline light duty vehicles is available from AEO, 

2011.
11

4. R es ults and C onclus ion

4.1. Results from Analysis of Co-benefits

The intent of this supplemental report was to analyze and illustrate key co-benefits of 

improvements in travel efficiency after the potential reductions in VMT and emissions have been 

estimated using the TEAM approach. The analysis focused on estimating savings in vehicle 

operating costs for travelers including savings in fuel costs, as well as savings in fuel 

consumption resulting from the seven scenarios defined in the EPA report. These co-benefits 

were analyzed for all decades from 2010 to 2050 on a daily basis. 

The key results are:

 In total, the seven scenarios are expected to result in daily light duty vehicle operating 

cost savings ranging from about $8.4 million for the least aggressive scenario to $282

million for the most aggressive scenario in 2050 (in 2010 dollars), compared to the 

business-as-usual scenario. 

 In total, the seven scenarios are expected to result in daily fuel cost savings for light duty 

vehicles ranging from $1.45 to $48.5 million in 2050 (in 2010 dollars), compared to the 

business-as-usual scenario.

 Expected daily fuel savings for the seven scenarios range from 0.85 to 28 million gallons 

in 2050, compared to the business-as-usual scenario.

Table 5 shows the results of this analysis in detail.
12

Table 5. Co-Benefits Resulting from Daily Reduction in Vehicle Miles Traveled (discounted @ 3%)

(in 2010 dollars)

Scenario 2010 2020 2030 2040 2050

Baseline national urban VMT (business-as-usual), 

in millions 5,118 5,889 7,130 8,254 9,555

1 Regionwide TDM 

 VMT Reduction from BAU baseline, in millions 0.00 3.49 6.98 16.12 25.26

 Auto operating cost savings, in $millions $0.00 $1.57 $2.84 $5.94 $8.43

 Savings in fuel costs only, in $millions $0.00 $0.35 $0.59 $1.12 $1.45

 Gallons of fuel saved, in millions 0.00 0.14 0.27 0.58 0.85

2 Land use changes + TDM 

 VMT Reduction from BAU baseline, in millions 0.00 36.10 72.20 177.97 283.75

 Auto operating cost savings, in $millions $0.00 $16.27 $29.38 $65.55 $94.75

 Savings in fuel costs only, in $millions $0.00 $3.66 $6.05 $12.35 $16.30

 Gallons of fuel saved, in millions 0.00 1.50 2.79 6.41 9.51

3 Land use changes + Transit fare change + TDM 

 VMT Reduction from BAU baseline, in millions 0.00 49.92 99.84 250.14 400.45

 Auto operating cost savings, in $millions $0.00 $22.49 $40.63 $92.13 $133.72

 Savings in fuel costs only, in $millions $0.00 $5.05 $8.37 $17.36 $23.01

 Gallons of fuel saved, in millions 0.00 2.07 3.86 9.00 13.42

4 Land use changes + Transit fare change + Transit service improvements + TDM 

 VMT Reduction from BAU baseline, in millions 0.00 51.91 103.81 260.38 416.94

 Auto operating cost savings, in $millions $0.00 $23.39 $42.25 $95.90 $139.23

 Savings in fuel costs only, in $millions $0.00 $5.26 $8.70 $18.07 $23.95

 Gallons of fuel saved, in millions 0.00 2.16 4.02 9.37 13.97

5 Land use changes + Transit fare change + Transit service improvements + Parking Fees + TDM 

 VMT Reduction from BAU baseline, in millions 0.00 104.26 208.52 437.22 665.92

 Auto operating cost savings, in $millions $0.00 $46.98 $84.86 $161.03 $222.37

 Savings in fuel costs only, in $millions $0.00 $10.56 $17.48 $30.34 $38.26

 Gallons of fuel saved, in millions 0.00 4.33 8.06 15.74 22.31

6 Land use changes + Transit fare change + Transit service improvements + Mileage Fees + TDM 

 VMT Reduction from BAU baseline, in millions 0.00 69.60 139.19 372.90 606.60

 Auto operating cost savings, in $millions $0.00 $31.36 $56.65 $137.34 $202.57

 Savings in fuel costs only, in $millions $0.00 $7.05 $11.67 $25.88 $34.85

 Gallons of fuel saved, in millions 0.00 2.89 5.38 13.42 20.32

7 Land use changes + Transit fare change + Transit service improvements + Parking Fees + Mileage Fees + TDM

 VMT Reduction from BAU baseline, in millions 0.00 122.07 244.15 544.01 843.88

 Auto operating cost savings, in $millions $0.00 $55.01 $99.36 $200.36 $281.80

 Savings in fuel costs only, in $millions $0.00 $12.36 $20.47 $37.75 $48.48

 Gallons of fuel saved, in millions 0.00 5.07 9.44 19.58 28.28
13

4.2. Indirect Benefits

The reduction of VMT and emissions from the analyzed travel efficiency strategies is likely to 

have benefits beyond those listed in Tables 2 and 5. These may be termed as indirect benefits 

because they are not directly related to the amount of travel reduced but could be indirectly

affected by implementation of the strategies. They are often not easily quantifiable since it is 

difficult to attribute these benefits solely to the transportation strategies considered. Several 

other external factors can have an influence, for instance, economic and political conditions 

governing fuel trade.

 Transit improvements constructed within a smart growth framework can lead to changes 

in the use and value of properties located near transit or near new infill developments. 

This increase in economic value is an indirect benefit of the transportation improvement.

 Improvements in transit service and intelligent transportation solutions (ITS) strategies 

could lead to greater reliability benefits for travelers, leading to enhanced productivity 

and more time spent in desirable pursuits rather than waiting at transit stations or sitting 

in congested traffic congestions. Tangible economic benefits can thus accrue from ITS 

strategies that lead to improvements in traffic flow and reduction in delays.

 Land use strategies like smart growth that involve compact development can increase 

regional accessibility and reduce the need for new infrastructure to be built further out in 

the region. These outcomes can lead to regional economic benefits from enhanced 

accessibility to employment and reduced costs for infrastructure provision. 

 Shifting to non-motorized transportation modes like walking and cycling can lead to 

additional health benefits associated with a physically active lifestyle and can reduce the 

incidence of obesity, other illnesses, and the stress of being “stuck in traffic”. The 

savings in health costs arising from using these modes are difficult to estimate because 

a traveler may choose to use these modes or not for other reasons, not directly related 

to the adopted strategy.

 Reducing fuel consumption by reducing VMT has the additional benefit to the U.S. 

economy of lowering the economic costs that result from U.S. petroleum consumption 

and imports. These external costs include subsidies on fuel prices, costs associated 

with the disruption in the flow of oil imports, outlays to support U.S. military activities to 

secure the flow of oil imports, and outlays to cushion the economy against possible 

interruption in oil imports by maintaining the Strategic Petroleum Reserve. Although 

these benefits can be quantified from guidance available from the Oak Ridge National 

Laboratories there is debate around the assumptions.

4.3. Conclusion

The analysis of co-benefits is crucial to understanding the full impacts of strategies aimed at 

reducing vehicle emissions and improving travel efficiency. It allows consideration of factors not 

directly perceived by travelers but with important social and economic implications. Given that 

transportation investment decisions frequently involve considerations beyond travel activity and 

emissions, it is important to be able to account for these co-benefits. Knowledge of the cobenefits allows transportation practitioners to evaluate projects and strategies in a more robust 

way, leading to a better allocation of resources. This supplement report provides quantitative 

and qualitative information for evaluating key-co-benefits that can prove helpful in decision 

making. The methodology used in this analysis may be applied to estimates of VMT reduction 

from implementing transportation strategies obtained using the TEAM approach and other 

methods. 
14

R eferences

AAA (2010), “Your Driving Costs”; available at: 

http://www.aaaexchange.com/Assets/Files/201048935480.Driving%20Costs%202010.pdf 

Cambridge Systematics (2001), Quantifying Air Quality and Other Benefits and Costs of 

Transportation Control Measures, NCHRP Report 462, Washington, DC: National Cooperative 

Highway Research Program, TRB.

Cambridge Systematics (2009), Technical Appendices, Moving Cooler: An Analysis of 

Transportation Strategies for Reducing Greenhouse Gas Emissions, prepared for Urban land 

Institute, Washington, DC: Urban Land Institute.

Concas, Sisinnio and Philip L. Winters (2008), Estimating Societal Benefits and Costs of 

Transportation Demand Management, paper presented at Transportation Research Board 

Annual Conference, Washington, DC. 

Concas, Sisinnio and Philip L. Winters (2009), Quantifying the Net Social Benefits of Vehicle 

Trip Reductions: Guidance for Customizing the TRIMMS© Model, prepared for Florida DOT, 

Tampa, FL: CUTR at the University of South Florida. Available at: 

http://www.nctr.usf.edu/pdf/77805.pdf

Ewing, Reid, K. Bartholomew, S. Winkelman, J. Walters, and D. Chen (2008), Growing Cooler: 

Evidence on Urban Development and Climate Change, prepared for Urban land Institute, 

Washington, DC: Urban Land Institute.

Federal Highway Administration (FHWA) (2006), Multi-Pollutant Emissions Benefits of 

Transportation Strategies, prepared by ICF International for FHWA, Washington, DC: Federal 

Highway Administration. Available at: 

http://www.fhwa.dot.gov/environment/conformity/mpe_benefits/

IRS Standard Mileage Rate for 2010available at: 

http://www.irs.gov/newsroom/article/0,,id=216048,00.html 

U.S. Energy Information Administration (EIA), Gasoline and Diesel Fuel update, 07/25/11; 

available at: http://www.eia.gov/oog/info/gdu/gasdiesel.asp

U.S. EIA, Annual Energy Outlook (AEO) 2011, table titled “New Light-Duty Vehicle Fuel 

Economy, reference case (miles per gallon)”

U.S. EIA, Annual Energy Outlook (AEO) 2011, table titled “Petroleum Product Prices in 2009 

dollars per gallon”

U.S. Environmental Protection Agency (EPA). (2011). Potential Changes in Emissions Due to 

Improvements in Travel Efficiency – Final Report. EPA-420-R-11-003. March. Available at: 

http://www.epa.gov/oms/stateresources/policy/420r11003.pdf

U.S. EPA (2010). Light-Duty Automotive Technology, Carbon Dioxide Emissions, and Fuel 

Economy Trends: 1975 Through 2010; available at: 

http://www.epa.gov/oms/fetrends.htm#archive

U.S. EPA, 40 CFR Parts 85, 86, and 600; U.S. Department of Transportation, National Highway 

Traffic Safety Administration, 49 CFR Parts 531, 533, 536, 537 and 538 [EPA–HQ–OAR–2009–
15

0472; FRL–9134–6; NHTSA–2009–0059], “Light-Duty Vehicle Greenhouse Gas Emission 

Standards and Corporate Average Fuel Economy Standards; Final Rule,” published on May 7, 

2010, available at: http://edocket.access.gpo.gov/2010/pdf/2010-8159.pdf

White House Office of Management and Budget (2003). Circular A-4, “Regulatory Analysis,” 

available at: http://www.whitehouse.gov/sites/default/files/omb/assets/regulatory_matters_pdf/a4.pdf 
16

Appendix

Information about the TRIMMS model

TRIMMS evaluates strategies that directly affect the cost of travel, like transit fare subsidies, 

parking pricing, pay-as-you-go pricing initiatives and other financial incentives. TRIMMS also 

evaluates the impact of strategies affecting access and travel times. The model allows the user 

to account for employer-based program support strategies, such as flexible working hours, 

teleworking, and guaranteed ride home programs. It allows the analyst to use local data or 

defaults from national research findings. The VMT impacts of a given mix of strategies are 

subsequently calculated. 

TRIMMS is a sketch planning tool that can be used to analyze many types of strategies at a 

regional or sub-area scale. However, strategies involving construction of new infrastructure 

such as new HOV/HOT lanes, new transit lines, and new bicycle/pedestrian facilities, can be 

analyzed most effectively using a regional travel demand model. In the TRIMMS model, such 

strategies can be modeled using the change in travel times and travel costs that such strategies 

represent. The TRIMMS model does not use trip tables. It requires average regional mode 

shares, average trip lengths and travel time by mode, average vehicle occupancy, parking 

costs, and trip costs as inputs. The user can change the price and travel time elasticity values. 

The tool provides changes in mode shares, trips, and VMT as outputs.

Table A-1. Methodology Used to Estimate Co-Benefits in TRIMMS

Measure TRIMMS Methodology

Change in Air Pollution Use of emission factors from EPA MOBILE6 model for 85 geographic regions 

represented in TRIMMS. Emissions damage costs in $/kg obtained from Delucchi 

(2005), inflated to 2009 dollars, and scaled for different urban areas, based on regional 

cost of living differences and population densities.

Change in Congestion Marginal added hours of delay per thousands of passenger‐car equivalent (pce) VMT 

(assumed to be 61.26 hours of delay per 1,000 pce VMT) x change in VMT estimated 

by TRIMMS x value of time ($/hour = 40% of average wage rate by occupation type, 

scaled to account for cost of living differences between regions).

Only pertains to the costs of added delay to others.

Change in Excess Fuel 

Consumption

Uses data on average travel speeds for 85 urban areas from the Texas Transportation 

Institute’s Urban Mobility Report to determine average fuel economy, and data on fuel 

prices in each urban area from the EIA.

Change in Impacts from 

Global Climate Change

Uses value of $50/metric ton of CO2 emissions from literature x (change in VMT) x 

CO2 emissions factor from MOBILE6.

Considers damages associated with CO2 only, following EPA guidance that other 

GHGs (N2O and CH4) are more volatile and difficult to estimate.

Change in Health and 

Safety 

Change in comprehensive health and safety costs is based on changes in the number 

of vehicle crashes resulting from each scenario.

Change in Noise 

Pollution

Changes in noise are calculated based on VMT ($/VMT) by mode type for urban areas. 

The costs are scaled to account for cost of living differentials between national 

averages and each regional area. Cost figures taken from Litman (2009).
17

Table A-2. Co-Benefits Resulting from Daily Reduction in Vehicle Miles Traveled (discounted @ 7%)

(in 2010 dollars)

Scenario 2010 2020 2030 2040 2050

Baseline national urban VMT (business-as-usual), 

in millions 5,118 5,889 7,130 8,254 9,555

1 Regionwide TDM

 VMT Reduction from BAU baseline, in millions 0.00 3.49 6.98 16.12 25.26

Auto operating cost savings, in $millions $0.00 $1.07 $1.33 $1.89 $1.84

 Savings in fuel costs only, in $millions $0.00 $0.24 $0.27 $0.36 $0.32

Gallons of fuel saved, in millions 0.00 0.14 0.27 0.58 0.85

2 Land use changes + TDM 

VMT Reduction from BAU baseline, in millions 0.00 36.10 72.20 177.97 283.75

 Auto operating cost savings, in $millions $0.00 $11.11 $13.71 $20.90 $20.64

Savings in fuel costs only, in $millions $0.00 $2.50 $2.82 $3.94 $3.55

 Gallons of fuel saved, in millions 0.00 1.50 2.79 6.41 9.51

3 Land use changes + Transit fare change + TDM

 VMT Reduction from BAU baseline, in millions 0.00 49.92 99.84 250.14 400.45

Auto operating cost savings, in $millions $0.00 $15.37 $18.96 $29.38 $29.13

 Savings in fuel costs only, in $millions $0.00 $3.45 $3.91 $5.54 $5.01

Gallons of fuel saved, in millions 0.00 2.07 3.86 9.00 13.42

4 Land use changes + Transit fare change + Transit service improvements + TDM 

VMT Reduction from BAU baseline, in millions 0.00 51.91 103.81 260.38 416.94

 Auto operating cost savings, in $millions $0.00 $15.98 $19.72 $30.58 $30.33

Savings in fuel costs only, in $millions $0.00 $3.59 $4.06 $5.76 $5.22

 Gallons of fuel saved, in millions 0.00 2.16 4.02 9.37 13.97

5 Land use changes + Transit fare change + Transit service improvements + Parking Fees + TDM 

 VMT Reduction from BAU baseline, in millions 0.00 104.26 208.52 437.22 665.92

Auto operating cost savings, in $millions $0.00 $32.10 $39.61 $51.35 $48.44

 Savings in fuel costs only, in $millions $0.00 $7.21 $8.16 $9.67 $8.33

Gallons of fuel saved, in millions 0.00 4.33 8.06 15.74 22.31

6 Land use changes + Transit fare change + Transit service improvements + Mileage Fees + TDM 

VMT Reduction from BAU baseline, in millions 0.00 69.60 139.19 372.90 606.60

 Auto operating cost savings, in $millions $0.00 $21.43 $26.44 $43.79 $44.13

Savings in fuel costs only, in $millions $0.00 $4.81 $5.45 $8.25 $7.59

 Gallons of fuel saved, in millions 0.00 2.89 5.38 13.42 20.32

7 Land use changes + Transit fare change + Transit service improvements + Parking Fees + Mileage Fees + TDM

 VMT Reduction from BAU baseline, in millions 0.00 122.07 244.15 544.01 843.88

Auto operating cost savings, in $millions $0.00 $37.58 $46.38 $63.89 $61.39

 Savings in fuel costs only, in $millions $0.00 $8.45 $9.55 $12.04 $10.56

Gallons of fuel saved, in millions 0.00 5.07 9.44 19.58 28.28