The Efficiency Dilemma

The Efficiency Dilemma, David Own, The New Yorker, December 20 and 27, 2010

If our machines use less energy, will we just use more?

"In April, the federal government ad­opted standards for automobiles re­quiring manufacturers to improve the average fuel economy of their new-car fleets thirty per cent by 2016. The Times, in an editorial titled "Everybody Wins," said the change would produce "a trifecta of benefits." Those benefits were enumerated last year by Steven Chu, the Secretary of Energy: a reduc­tion in total oil consumption of 1.8 bil­lion barrels; the elimination of nine hundred and fifty million metric tons of greenhouse-gas emissions; and savings, for the average American driver, of three thousand dollars .

Chu, who shared the Nobel Prize in Physics in 1997, has been an evange­list for energy efficiency, and not just for vehicles. I spoke with him in July, shortly after he had conducted an inter­national conference called the Clean Energy Ministerial, at which efficiency was among the main topics. "I feel very passionate about this," he told me. 'We in the Department of Energy are trying to get the information out that efficiency really does save money and doesn't nec­essarily mean that you're going to have to make deep sacrifices."

Energy efficiency has been called "the fifth fuel" (after coal, petroleum, nuclear power, and renewable) ; it is seen as a cost-free tool for accelerating the transition to a green-energy econ­omy. In 2007, the United Nations Foundation said that efficiency im­provements constituted "the largest, the most evenly geographically distributed, and least expensive energy resource." Last year, the management-consulting firm McKinsey & Company concluded that a national efficiency program could eliminate "up to 1.1 gigatons of green­house gases annually." The environ­mentalist Amory Lovins, whose think­ing has influenced Chu's, has referred to the replacement of incandescent light bulbs with compact fluorescents as "not a free lunch, but a lunch you're paid to eat," since a fluorescent bulb will usually save enough electricity to more than offset its higher purchase price. Tanta­lizingly, much of the technology required to increase efficiency is well understood. The World Economic Forum, in a report called "Towards a More Energy Efficient World," observed that "the average refrigerator sold in the United States today uses three quarters less energy than the 1975 average, even though it is 20% larger and costs 60% less"-an improvement that Chu cited in his conversation with me.

But the issue may be less straight-forward than it seems. The thirty-five-year period during which new refrigerators have plunged in electricity use is also a period during which the global market for refrigeration has burgeoned and the world's total energy consumption and carbon output, including the parts directly attributable to keeping things cold, have climbed. Similarly, the first fuel-economy regulations for U.S. cars-which were enacted in 1975, in response to the Arab oil embargo were followed not by a steady decline in total U.S. motor-fuel consumption but by a long-term rise, as well as by increases in horsepower, curb weight, vehicle miles traveled (up a hundred per cent since 1980), and car ownership (America has about fifty million more registered vehicles than licensed drivers). A growing group of economists and others have argued that such correlations aren't coincidental. Instead, they have said, efforts to improve energy efficiency can more than negate any environmental gains-an idea that was first proposed a hundred and fifty years ago, and which came to be known as the Jevons paradox*.

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* Note: In economics, the Jevons paradox, sometimes called the Jevons effect, is the proposition that technological progress that increases the efficiency with which a resource is used tends to increase (rather than decrease) the rate of consumption of that resource. In 1865, the English economist William Stanley Jevons observed that technological improvements that increased the efficiency of coal-use led to the increased consumption of coal in a wide range of industries. He argued that, contrary to common intuition, technological improvements could not be relied upon to reduce fuel consumption. Wikipedia