When gasoline zoomed past the stomach-clenching $4 per gallon mark recently, did you cut down on your driving? That answer is probably "yes." After all, when it's costing you $40-$60 (or more) to fill up your tank, you think twice about driving an hour each way to your favorite restaurant in the city, shuttling your kids to the mall, or taking that weekend getaway to the other end of the state. It's just too expensive to waste gas on non-essential driving. (For more information on the cause of high gas prices, check out What Determines Gas Prices?)

TUTORIAL: Commodities - Crude Oil

And you're not alone in your frugality. Every time gas prices climb, demand goes down. Thanks to this spring's price spike, demand has fallen for twelve straight weeks, according to MasterCard's SpendingPulse report. We just don't like paying for gas, especially when it hovers around $4 per gallon. So, our cars end up hanging out in the driveway a lot more. (To learn more about the price at the pump, check out Will Gas Prices Ever Go Down?)

High gas prices may be a frustrating side effect of the nation's oil crisis, but there's actually an upside to sticker shock at the pump - it's good for the environment. Here are three ways this summer's high gas prices are helping Mother Earth.

1. We're Driving Less
As of March 2011, the U.S Department of Transportation reported that highway travel had declined 1.4% from a year ago, making it the first year ever that there was a year-over-year driving decline. In fact, on the West Coast, highway travel decreased by 2.4%.

The less we drive, the less oil we consume. Moreover, since we're so reluctant to drive our cars around, more of us are taking public transportation. Public transportation is not only cheaper than driving your own car, it also uses less energy and emits fewer greenhouse gasses per person.

The American Public Transportation Association reports that a single person who switches to public transport can reduce their daily carbon emissions by 20lbs, or 4,800lbs per year. And, public transportation in the United States saves 4.2 billion gallons of gasoline every year.

2. We're Buying More Efficient Cars
The higher gas climbs, the less we love huge SUVs. Sales of larger SUVs keep falling, which is great because not only are they expensive to fill up, they also emit 30% more carbon monoxide and hydrocarbons, and 75% more nitrogen oxides, than passenger cars.

In fact, many large SUVs are exempt from "light truck" emission standards because they're so heavy. So even though we drive them as much as we do a light car, they pollute like a heavier industrial truck.

But people aren't just down-grading from SUVs to smaller cars - sales of fuel-efficient cars and hybrids are steadily increasing. Ford and Toyota both posted higher sales for their fuel efficient cars and hybrids this spring. (To learn how the price of gas has affected you decision making process, see How Rising Gas Prices Affect Consumer Decisions.)

3. Businesses Conserve More Energy
Businesses, too, change their habits as gas prices rise. For instance, many businesses and even some city and state governments have made the transition to a four-day work week. This way, their employees wouldn't have to commute, and buy gas, for that extra day. If workers don't do any driving on their extra day off, this means they're using 20% less gas every week.

Working a four-day week also reduces energy consumption because the buildings don't have to be heated or cooled at their normal levels. When the state of Utah transitioned to a four-day week for government workers, the state saved 13% in energy costs.

There were also some other surprising benefits: absenteeism and health complaints declined, morale went up, and workers felt more relaxed and enthusiastic about coming in on Monday because they'd had three days off in a row.

The Bottom Line
So, what does all this mean for you? High gas prices are, without a doubt, painful, especially for low and middle class families. People often have to make incredibly difficult choices when gas prices climb, but the bright side is that higher prices do have positive benefits for the environment. We consume less oil, we keep more pollution out of the air, and traffic congestion eases. High prices force us to reexamine our habits to make smarter choices. This, in turn, results in a healthier planet for all of us. (We know how gas prices affect each individual, but it is also important to know How Gas Prices Affect The Economy.)

Related Articles
  1. Economics

    Explaining Manufacturer’s Suggested Retail Price

    The manufacturer’s suggested retail price (MSRP) is just what it describes – the price manufacturers recommend that retailers charge for their goods.
  2. Economics

    Calculating Cross Elasticity of Demand

    Cross elasticity of demand measures the quantity demanded of one good in response to a change in price of another.
  3. Personal Finance

    What to Collect: Apple Watch vs. Luxury Watches

    The "iWatch" is a new player in the luxury watch world. But will it stand the test of time? Some points for collectors to ponder.
  4. Stock Analysis

    The 5 Best Buy-and-Hold Energy Stocks

    Understand why energy companies' stock are volatile when oil prices are volatile. Learn about the top five energy companies to buy and hold.
  5. Investing

    Have Commodities Bottomed?

    Commodity prices have been heading lower for more than four years, being the worst performing asset class of 2015 with more losses in cyclical commodities.
  6. Investing

    Oil: Why Not to Put Faith in Forecasts

    West Texas Intermediate oil futures have recently made pronounced movements. What do they bode for the world market?
  7. Markets

    How Energy’s Debt Bubble Affects Your Portfolio

    Depressed crude oil prices are here to stay for the foreseeable future. Here's how it will affect an oil industry riddled with unsustainable debt.
  8. Stock Analysis

    2 Reasons PepsiCo's Snacks Division is Crucial to Its Growth

    Understand the recent trends in the North American snacks market. Learn about the top two reasons why PepsiCo's snack division is crucial to its growth.
  9. Stock Analysis

    2 Oil Stocks to Buy Right Now (PSX,TSO)

    Can these two oil stocks buck the trend?
  10. Personal Finance

    Alpaca vs. Cashmere: Which Luxe Wool Is the Best?

    Winter is coming. Which of these luxury threads is most worth the price (and how to distinguish true luxe from cheap imitations).
  1. What does marginal utility tell us about consumer choice?

    In microeconomics, utility represents a way to relate the amount of goods consumed to the amount of happiness or satisfaction ... Read Full Answer >>
  2. What are some common ways product differentiation is achieved?

    There are many ways to achieve product differentiation, some more common than others. Horizontal Differentiation Horizontal ... Read Full Answer >>
  3. What is the difference between an OEM (original equipment manufacturer) and a VAR ...

    An original equipment manufacturer (OEM) is a company that manufactures a basic product or a component product, such as a ... Read Full Answer >>
  4. Is the retail sector also affected by seasonal factors?

    Generally speaking, the retail sector is highly seasonal. Almost invariably, sales in the retail sector are highest in the ... Read Full Answer >>
  5. How much oil must be produced to maintain inventory levels in the United States?

    Domestic energy investors should track the reserve inventory of crude oil for the United States, which is released in a weekly ... Read Full Answer >>
  6. To what extent is the oil and gas sector dominated by a few major companies?

    Oil and gas are two expansive and highly diverse product lines, with active competition domestically and internationally. ... Read Full Answer >>

You May Also Like

Hot Definitions
  1. Capitalization Rate

    The rate of return on a real estate investment property based on the income that the property is expected to generate.
  2. Gross Profit

    A company's total revenue (equivalent to total sales) minus the cost of goods sold. Gross profit is the profit a company ...
  3. Revenue

    The amount of money that a company actually receives during a specific period, including discounts and deductions for returned ...
  4. Normal Profit

    An economic condition occurring when the difference between a firm’s total revenue and total cost is equal to zero.
  5. Operating Cost

    Expenses associated with the maintenance and administration of a business on a day-to-day basis.
  6. Cost Of Funds

    The interest rate paid by financial institutions for the funds that they deploy in their business. The cost of funds is one ...
Trading Center
You are using adblocking software

Want access to all of Investopedia? Add us to your “whitelist”
so you'll never miss a feature!