Thursday, July 27, 2006

Energy efficiency is a false target

You don't need to read much about energy or climate change before the goal of greater energy efficiency is stated, usually without any further analysis or justification. The United Kingdom's long-awaited and much researched Energy Review, published July 14th 2006, asserts the same goal. Unfortunately, the goal might have the opposite effect on climate change to that intended.

The only figure that will affect climate change is our absolute rate of greenhouse gas emissions. How many people it took to put the molecules of CO2 in the atmosphere, or where they were living at the time, is entirely irrelevant. We will get no points for reducing our per-capita use of energy if there are simply more of us, and no points for merely reducing the rate at which our emissions increase.

If we are to avoid explicit population controls and rationing, then surely improved efficiency is to be welcomed as a way to reduce emissions? Not necessarily. The problem is that efficiencies can drive down costs and thereby increase consumption. The net effect of efficiency is not always obvious. In very general terms, as a society our industrial and domestic efficiencies have never been higher - along with our consumption.

This effect is well-known in economics as Jevon's paradox.

As an example, consider the efficiency of the airline industry. As it improves, the price per seat falls. Those that flew before notice a cost saving and the industry uses fewer resources servicing them, but soon a slew of new customers arrive who find the price affordable. Consumption rises. In the same vein, as we improve the performance of battery-powered devices, electric cars, lighting and so forth, expect new applications to appear that will help us reach new heights of consumption.

Should we target overall consumption instead? Yes, but we must be aware of another potential problem, ultimately that of social unrest. How should a finite resource be rationed and distributed among a population? We want it all - a stable climate, with the lights on and freedom from the fear that a disgruntled neighbour with fewer rations doesn't overthrow society and break those lights we worked so hard to keep glowing.

Sadly, the call for efficiency repeated by the Energy Review and governments around the world could backfire. More consideration to other effects is needed. Although the treacherous rocks of inadequate energy supplies, climate change and social unrest have been charted by many, no-one appears yet to have understood how to navigate our civilization safely past all three.

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