According to an article from the MIT Material Systems Laboratory called Life Cycle Assessment of Hand Drying Systems by T. Montalbo, J. Gregory, R. Kirchain--air hand dryers are much more environmentally friendly than their paper based counterparts. Also, according to AsapSCIENCE, the United States alone uses 13 billion pounds of paper towels in a single year.
In the article Analysis of Hand Drying Systems by R. Bacon from Washington State University Vancouver calculations were done to show the cost per month for air hand dryers and papertowels: