By Roza Kazan

Prices have been falling for two years now. At an average of about $2.20 a gallon, it’s a far cry from the record $4 a gallon during the 2008 recession.U.S. consumers are spending less at the gas pump these days, paying on average about $2.20 per gallon. The American Automobile Association said prices are at their lowest in 12 years.

About a quarter of all gas stations in the U.S. right now are selling gasoline for less than $2 a gallon. Consumers haven’t seen prices this low during the summer since 2004.

But while cheap gas is good for commuters and vacationers, the Environmental Protection Agency said, it’s bad for the planet.

The government’s Environmental Protection Agency said driving is responsible for more than 16 percent of the U.S. greenhouse gas emissions. Due to the lower gas prices, Americans have returned to driving and buying bigger cars.

The U.S. government said Americans saved $700 on gas per household last year. Economists expect that to be good news for the economy as consumers drive and spend more.

However, the U.S. shale oil boom led to tremendous production of oil and gas. But as oil prices dropped, the industry has slowed down dramatically.

“There’s been a lot of people that have been laid off, tens of thousands if not more,” Sam Ori, executive director from Energy Policy Institute at the University of Chicago, said. “And the amount of capital that the industry is investing in the U.S. economy in particular took a more than a $100 billion hit.”

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Areas of Focus: Energy Markets
Definition
Energy Markets
Well-functioning markets are essential for providing access to reliable, affordable energy. EPIC research is uncovering the policies, prices and information needed to help energy markets work efficiently.
Fossil Fuels
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Fossil Fuels
Under current policies, fossil fuels will play an important role in the energy system for the foreseeable future. EPIC research is exploring the costs and benefits of these fuels as...
Transportation
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Transportation
Mobility is central to economic activity. Yet, a lack of fuel diversity and continued demand growth have made the transportation industry a major contributor to global pollution and carbon emissions....