The upside to pain at the pump

By LAURIE BLAKE
Minneapolis-St. Paul Star Tribune
Thursday, May 17, 2007

The $3 gas prices posted at the station he passes on the way to work give Kevin Ishaug 20 miles to gloat over how much he saves commuting by bike.

Ishaug, owner of the Freewheel Bike shop in Minneapolis, is one of those people who welcome higher prices at the pump. It brings more people into his shop for new bikes or repairs, as they switch to muscle-powered transportation to save money.

"People are really giving up the car for a change of lifestyle," said Ishaug. "We're nearing a tipping point with a lot more people getting that kind of mindset."

As gas prices sail to new highs most observers are expecting people to complain, pay up and keep driving.

But some welcome the rising cost of fill-ups _ not just bicycle dealers, but also environmentalists seeking to reduce air pollution and transit advocates who see hordes of new passengers.

"We are delighted that gas prices are going up," said Robert Gibbons, director of customer services for Metro Transit. "We had this experience last year and we are convinced it helped us increase our transit ridership."

Gas consumption has gone up every year since 2000, according to the U.S. Energy Information Administration. During the first week of May, when prices jumped to $3.05 a gallon, demand for gasoline dipped only slightly _ by about two-hundredths of a percent, the energy administration reported.

Akshay Rao, professor of marketing at the Carlson School of Management at the University of Minnesota, said gas prices won't dramatically reduce driving until the cost cuts into food or vacations or other things people would rather buy. "The vast majority of consumers will continue act as if there is no tomorrow," Rao said.

He thinks it's more likely that people will cut back on driving when they believe the predictions that oil is a finite resource that will last only another 30 to 35 years. "If people stop and think, that is likely to change their behavior."

The customers have started complaining, said Mark Olson, owner of a Richfield Mobil station, who said the high prices aren't actually helping his profit margins. "I just had two ladies walk out of here screaming and yelling, 'I have never put that much in my gas tank in my life.' "

For Jim Erkel, land use and transportation director for the Minnesota Center for Environmental Advocacy, the rising cost of tanking up could ultimately change the direction of community growth. At some point the prices will start to dampen enthusiasm for driving, Erkel said. Fewer car trips mean less air pollution and may discourage people from chewing up green space by moving ever farther from the metro core, he said.

Dobrila Stancevic, 52, recently moved from Eagan, Minn., to Minneapolis so she wouldn't have to drive as much. For the past two weeks, she has ridden a bicycle to her substitute teaching jobs, and has tried to persuade many of her colleagues to do the same, for the sake of fitness, the environment and other reasons.

As far as rising gas prices, Stancevic said, "To be honest with you, I hope they keep going up, because I think people are driving too much."

(Reach Laurie Blake at lblake(at)startribune.com. To comment or for more stories visit scrippsnews.com)

(Distributed by Scripps Howard News Service, www.scrippsnews.com.)