Environmental Engineering Reference
In-Depth Information
Energy conservation demands substantial socioeco-
nomic adjustments in return for its long-term benefits.
But its rewards go beyond energy savings. As it reduces
environmental impacts, it offers the satisfaction of secur-
ing additional needed energy by restraint and careful use
rather than by merely seeking an ever-greater supply.
But do conservation efforts reduce energy consump-
tion in the long run? Both economic theory and con-
sumer behavior lead us to expect a rebound effect as the
lower costs of energy services brought about by increased
conversion efficiencies stimulate consumption. The mag-
nitude of the direct rebound effect (for instance, using a
greater number of efficient lights and leaving them on
overnight) has been disputed, but it typically ranges be-
tween 10% and 30% for such common energy services as
space heating and cooling, lighting, and car transport
(Herring 2004). Other price-elasticity effects that tend
to increase the use of more efficiently delivered energies
include income-related effects (spending the savings on
other goods and services), product and factor substitu-
tion (more energy used in lieu of labor, time), and most
important, transformational effects resulting from long-
term technical and socioeconomic changes.
In the short run and at a microeconomic level, energy
conservation efforts are undoubtedly financially and emo-
tionally rewarding. Similarly, companies with energy-
intensive products can realize impressive savings that can
eventually extend to entire industries. But these savings
do not translate into any lasting reductions in the overall
use of energy in economies at large, and actually contrib-
ute to the growth of global energy use. The idea that
secular advances in energy efficiency lead to declines in
aggregate energy consumption was eloquently discred-
ited for the first time by W. Stanley Jevons, the first econ-
omist to address the potential of higher efficiency for
''completely neutralising the evils of scarce and costly
fuel'' (Jevons 1865, 137).
Jevons concluded, ''It is wholly a confusion of ideas to
suppose that the economical use of fuels is equivalent to a
diminished consumption. The very contrary is the truth.
As a rule, new modes of economy will lead to an increase
of consumption according to a principle recognized in
many parallel instances'' (Jevons 1865, 140). His prime
example was the diffusion of Watt's low-pressure steam
engine and later high-pressure engines whose efficiencies
were eventually more than 17 times higher than that of
Savery's atmospheric machine but whose diffusion was
accompanied by a huge increase in coal consumption.
His conclusions have been shared and elaborated by vir-
tually all economists who have studied the macroeco-
nomic impacts of increased energy efficiency. Herring
(2004; 2006) provides excellent surveys of these debates.
The most resolute counterarguments claim that the
future elimination of large existing conversion inefficien-
cies and the shift toward increasingly service-based, and
less material-intensive, economies can lead to stunning
reductions of energy use at the national level (Lovins
1988; Hawken, Lovins, and Lovins 1999). Lovins
(1988) also argued that at the consumer level the re-
bound effect, whereby savings accruing from more effi-
cient energy use lead to lower prices and hence to
increased consumption either in the same category (di-
rect rebound) or for other goods and services (indirect
rebound), is minimal, a position rejected by Khazzoom
(1989). But others argue that improvements in efficiency
are only a small part of the reason that total energy con-
sumption may have gone up and that the overall growth
of energy use is more related to increasing population,
household formation, and rising incomes (Schipper and
Grubb 2000).
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