Emissions on the Road: Environmental Impact of Automobiles and the Benefits of Going Green

Vehicles affect the environment. The Environmental Protection Agency (EPA) reports that transportation activities produced 29% of U.S. greenhouse gas emissions in 2021. These emissions cause air pollution, climate change and global warming — issues that affect your health and finances.

The financial impacts show up in your bills for food, utilities, gas, health care and insurance. Extreme weather events can cost you income or even your home. Climate change demands more responsible choices about vehicle usage.

Your driving habits contribute to global warming. But switching to environmentally friendly vehicles can reduce emissions and lower your auto insurance costs.

Greenhouse gas emissions, including carbon dioxide (CO2), methane (CH4) and nitrous oxide (N2O) emissions, harm the environment. In the U.S., transportation activities cause the most emissions at 29%. According to the EPA, a typical passenger vehicle emits 4.6 metric tons of CO2 annually.

Net emissions increased by 6% compared to the 2021 total, mainly due to increased economic activity after the slowdown during the COVID-19 pandemic. Overall, total emissions from the transportation sector grew 19% from 1990 to 2021.

Carbon dioxide emissions from energy consumption fluctuate as consumption levels change. Petroleum remains the highest contributor to CO2 emissions in the industry. Natural gas emissions are much lower but have increased consistently over time.

Source: Energy Information Administration

In 2021, the transportation industry had the highest greenhouse gas emissions in the country among all economic sectors, up 18.6% since 1990. Year-over-year, emissions increased as economic activity grew, dropping after the COVID-19 pandemic slowdown in 2020. The 2021 total is slightly lower than the 2016, 2017, 2018 and 2019 numbers but trends upward. Historically, greenhouse gas emissions in the transportation sector peaked in 2007 when it recorded 1,967.25 million metric tons of carbon dioxide equivalent.

Source: U.S. Environmental Protection Agency

In 2020, Texas recorded the highest energy-related CO2 emissions in the U.S., with 624 million metric tons, including 192.7 million metric tons from transportation. Vermont had the lowest total CO2 emissions, recording only 5.6 million metric tons, with transportation-related emissions accounting for 2.9 million metric tons.

The map below shows total CO2 emissions per state.

Source: Energy Information Administration

Vehicles are among the highest contributors of greenhouse gas emissions, but not all vehicles emit the same amount. Factors such as engine technology, fuel type, usage patterns and vehicle size all affect emissions. Among on-road vehicles, light-duty trucks have the highest greenhouse gas emissions in 2021 at 671.8 million metric tons of CO2 equivalent. They're followed by medium- and heavy-duty trucks (417.1 million metric tons), passenger cars (374.2 million metric tons), buses (25.7 million metric tons) and motorcycles (7.5 million metric tons).

These include light-duty vehicles with a maximum gross vehicle weight rating (GVWR) of <8,500 lbs. and medium-duty vehicles (8,501 to 10,000 lbs.). The EPA considers a vehicle a passenger car if it's primarily used for transporting 12 people or less. In 2021, passenger cars recorded the third-highest greenhouse gas emissions among on-road vehicles at 374.2 million metric tons. Beyond vehicle type, emissions vary by fuel type.

Here's a breakdown of light-duty vehicle emissions reported by the Bureau of Transportation Statistics (BTS).

Light-duty trucks refer to vehicles that carry passengers and cargo. These include sport utility vehicles (SUVs) and minivans. In 2021, light-duty trucks across the country produced 671.8 million metric tons of CO2 equivalent emissions. The EPA also reported that light-duty trucks traveled more than 1,492,200 million miles in the same year.

The table below shows the differences in estimated average emission rates between gasoline- and diesel-fueled light-duty trucks.

Medium- and heavy-duty trucks produced 417.1 million metric tons of CO2 equivalent in 2021, making them the second-largest contributor among on-road vehicles. These vehicles traveled 317,245 million miles that year. This category includes single-unit trucks, combination trucks, tractor-trailers and box trucks used for freight transportation, plus service and utility trucks.

The table below compares emission rates between gasoline- and diesel-fueled heavy-duty vehicles.

Buses were the fourth-highest contributor of greenhouse gas emissions. They totaled 25.7 million metric tons of CO2 equivalent or 1.3% of all emissions. Specifically, bus emissions include 25.1 million metric tons of CO2, 0.2 million metric tons of nitrous oxide and 0.4 million metric tons of various hydrofluorocarbons (HFC).

Motorcycles had the lowest greenhouse gas emissions among on-road vehicles. In 2021, motorcycles totaled 7.5 million metric tons of CO2 equivalent. Specific emission rates for typical motorcycles are as follows:

In 2022, the world recorded its sixth-warmest year since 1880, ten of which have occurred since 2010. During this period, the world has seen climate anomalies like rising seas, droughts and severe flooding. Temperature changes over time result from global warming caused by greenhouse gas emissions. Motor vehicles produce some of the highest emissions from multiple sources. In the U.S., the transportation industry has the highest impact among all energy sectors.

The effects of car emissions extend beyond weather-related events. Climate change has an indirect effect on the economy, health and personal finance. Home values decrease, utility bills increase and insurance costs go up due to higher risk of property damage from extreme weather events.

Cars, including passenger vehicles, are major contributors to global warming. They're major sources of greenhouse gas emissions. This isn't exclusive to the U.S. The transportation sector contributes 16.2% of all greenhouse gas emissions globally. Of these, 11.9% are from on-road vehicles.

Individual efforts add up when more people participate. When car owners choose fuel-efficient vehicles, reduce vehicle usage and practice eco-friendly driving habits, car emissions decrease, air quality improves and fossil fuel dependence drops. The United Nations includes sustainable transport in the sustainable development goals under the Paris Agreement on Climate Change.

Here are a few steps car owners can take to reduce carbon footprints:

Auto insurance provides financial protection against unexpected incidents. But depending on the policy, this may come at a high price. Many auto insurance providers offer green or eco-friendly auto insurance, in which green efforts are rewarded with discounts. Green car insurance may also refer to programs that allow you to pay premiums based on how much you drive.

Green auto insurance promotes sustainable driving through financial incentives. Insurance companies offer specialized coverage for low-emission vehicles like hybrids and electric cars. These policies include higher coverage limits for replacement parts and repairs. Some insurers add coverage for batteries and power cables or create incentive programs that lower your insurance costs.

For some insurance companies, green auto insurance comes from usage-based policies. With this, you'd only pay insurance for how much you drive. For example, the fewer miles you accumulate, the lower your premium. This is a way to reward drivers who reduce their car emissions and practice eco-friendly driving, such as smoother acceleration and braking and avoiding peak traffic hours.

Pay-as-you-drive programs install a mileage-tracking device in your vehicle. You get policy discounts when you drive fewer miles than average.

Insurance companies reward environmentally friendly transportation choices. Beyond pay-as-you-drive programs and specialized coverage, green insurers offer additional incentives.

The automotive market now offers more eco-friendly vehicles that run on alternative energy or use fuel more efficiently. These vehicles produce fewer greenhouse gas emissions and reduce your fuel costs over time.

Here's what to consider when switching to an eco-friendly vehicle.

Choosing to go green is a huge decision that requires commitment. MoneyGeek asked a few industry experts to provide some insights to help you better understand the correlation between vehicles and climate change.

Being informed about how cars affect global warming and educating yourself about possible solutions can help you start your journey to driving green. MoneyGeek listed some resources you may find helpful.

• AAA Electric Vehicle Range Testing: Compare the driving range of different EVs in the country. Find out what factors affect their driving range.
• AirNow: Enter your ZIP code, city or state and get air quality data.
• Center for Climate and Energy Solutions: Get tips on reducing transportation emissions. Check out other ways to reduce your home and work carbon footprint.
• Fueleconomy.gov: Compare cars' EPA ratings and features and see which is best for your needs. Access driving and gas mileage tips to become a more efficient driver.
• Health Effects Institute: Read studies about air pollution, common sources and health effects of long-term exposure.
• Kelley Blue Book: Search for cars for sale near you. Read reviews and compare different car types, models and prices.
• NASA Global Climate Change: Learn more about climate change, its causes, effects, global warming and what can be done to solve the problem. Monitor global temperature changes and carbon dioxide levels.
• National Conference of State Legislatures: Check out state policies on hybrid and EVs. Learn which states offer incentives.
• U.S. Department of Energy: Find resources on energy and fuel efficiency.
• U.S. EPA's Green Vehicle Guide: Find out what SmartWay Certified vehicles are and how they can help reduce greenhouse gas emissions. Search for SmartWay vehicles based on model year, make and vehicle class.
• U.S. EPA's Vehicle Emissions Inspection and Maintenance: General information for motorists: Learn about vehicle inspection and maintenance programs. Access relevant state and local government websites.