Why energy efficiency isn't reducing consumption but how carbon rationing could.

• Author: Fitz, Don
• Position: Less Energy

Energy efficiency is not reducing the consumption of energy. This is true despite claims from green businesses, Al Gore, and Amory Lovins that it is the best way to cut down on use of coal, oil, gas, and nukes. Put these claims out of your mind for a couple of minutes and common sense will make it clear why efficiency doesn't deliver.

If you want to reduce the use of anything (energy included), what's the first idea that hops into your brain? "Raise prices," most people say. If something costs more, people use less. If the price of gasoline jumps to $5 per gallon, people drive less.

The flip side is: If you want people to buy more of something, reduce the price. Stores advertise sales because they get customers buying.

Energy efficiency is like putting energy on sale. If you insulate your home, get a fuel efficient car, or buy an appliance that runs on less electricity, then your energy costs go down. This makes it cheaper to use energy. Just as making energy more expensive means people will use less, making energy cheaper (or more efficient) leads to the prediction that people will use more.

It is only because we are told over and over again that energy efficiency results in less energy use that we would believe something that violates economic common sense. If a home is more energy efficient, it is tempting to turn the heat up to 72-75 degrees (rather than down to 60-65 degrees). If cars have more stringent fuel efficiency standards, expect more motorists to buy SUV equivalents and drive them more miles. Fuel efficiency could be the death knell for mass transit--expect [CO.sub.2] to pour from cement companies trying to supply widened roads for an influx of fuel efficient cars.

Products designed to be energy efficient are low cost energy on steroids. First, people use the product more because it is cheaper. Second, once people have spent money on a product, the best way to get a return on an investment is to use it as much as possible. No one buys something in order to NOT use it. Efficiency tends to result in energy use going up rather than down.

This "rebound effect" was observed as long ago as 1865 when Stanley Jevons wrote The Coal Question. New industrial techniques meant that only one third as much coal was needed to produce a ton of iron. Far from reducing the amount of coal used, the new methods were followed by a 10-fold increase during 1860-1863 in Wales. (1)

In 1980, Danile Khazoom and Len Brookes surveyed a range of...