Higher Gas Prices in China May Be Good

The Chinese government this week raised the price of gasoline almost 10 percent as shortages spread across the country. Higher gas prices may be just what Earth’s doctor ordered.

Given the recent rise in the cost of crude, the Financial Times reports, Chinese policymakers face challenges. To pay for expensive crude, retail fuel prices would naturally go up. But the government is concerned about inflation. And according to “analysts” in the FT article, concerns over public unrest would stop prices from rising more than about 10 percent further before the Olympics.

But some amount of public unrest over fuel prices may be what’s necessary to slow the rapid growth of automobile ownership and related pollution in Chinese cities. If it’s more expensive to drive, more people may choose public transport.

To SubwayMaking public transit cheaper has already had a partial effect. Last month, the number of public transit commuters surpassed car commuters for the first time since records were first kept in 2001. That landmark is largely due to the opening of the new Line 5 and a drop in ticket prices in early October. Since those changes, daily average ridership has reached 2.48 million, a 58 percent increase over the previous nine months.* Bus ridership also spiked after an earlier price drop.

The People’s Daily Online reports that 34.5 percent of Beijing commuters use public transit, versus 32 percent who use private vehicles. That leaves a third of commuters who use the most environmentally friendly methods: walk, bike, run, but don’t use a vehicle. Beijing wants to raise the proportion of public transit riders to 50 percent by 2012, but to do that, it will need to sufficiently discourage more people from joining the car-owning throngs. Perhaps more expensive fuel will do the trick.

Some environmentalists have encouraged the United States to levy heavy taxes on gasoline to encourage people to use alternative transportation and buy fuel-efficient cars. Others point out that this method puts the burden on commuters with lower incomes rather than on the individuals profiting from high emissions. At least in Beijing, however, this would not seem to be the case. Few if any low-income workers here own cars. Higher gas prices, if they can serve as an incentive not to pollute, will impact the people who have the luxury of choice. And with some luck, the city’s massive subway expansion projects will provide the capacity necessary to make that choice attractive.

* That statistic may be misleading. The previous nine months are warmer months, and the coming three will be cold. Some amount of this “increase” may be natural seasonal shift as people opt for a bus over a bike. At this time I only have this information from the People’s Daily Online article.

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