How much difference can energy efficient technologies really make in reducing greenhouse gas emissions?

The question isn’t rhetorical. I’m genuinely curious, and more than a bit concerned that the answer may be “not much.”

Books such as Factor Four (by Ernst von Weizsacker and the redoubtable Hunter and Amory Lovins) argue that smart technologies make it possible to quadruple the amount of wealth generated by a given unit of natural resources. I like the sound of that: maintaining a high standard of living with one-fourth the ecological footprint, or (an easier sell) doubling our wealth while halving our environmental impact, sounds like something everyone could get behind.

But is that what would really happen if we improved energy efficiency? The experience of the last several decades gives me reason to doubt it.

  • The energy crunch of the late 1970s ushered in huge investments in energy efficiency. Today, our refrigerators, TVs and other home appliances use much less electricity than they did two decades ago; auotomobile engines are far more fuel-efficient; new generations of furnaces and water heaters use energy more sparingly; and the list goes on.

    But person for person, energy consumption in the Northwest has basically remained stagnant, stuck at the same high level since the early 1980s. For every increase in efficiency, we saw a corresponding increase in consumption: bigger living spaces, larger fridges (and maybe an extra freezer in the basement), more TVs, scads of new appliances, homes farther out in the suburbs that require more driving, faster speeds on the highways, and on and on. Like Alice’s Red Queen in Through the Looking Glass, energy efficiency runs faster and faster, but consumption stays in the same place.

    Part of the problem can be traced to the “rebound effect“: efficiency increases also reduce consumer costs, so people can afford to use a little more than they otherwise would. For example, if you add insulation to your home, or buy a more efficient furnace, you might also turn up your thermostat a couple of degrees. That tendency—which is observed in all sorts of realms, not just home heating—means that actual energy savings are often less than the efficiency gains alone might predict.

    Rebound effects may also be visible on a larger scale. If lots of people install the latest high-efficiency appliances in their homes, then that drives down energy demand. The fall in demand helps hold down energy prices. But low prices encourage higher consumption somewhere else in the economy—which further attenuates the gains from efficiency.

    Most troubling of all, high-efficiency technologies may actually lead to increases in energy consumption. This is known in economics circles as the Jevons Paradox, named after the British economist who noted that coal consumption in England soared after James Watt’s steam engine was introduced. Watt’s engine was much more efficient than earlier engine designs. But that meant that coal-fired steam technology suddenly became cost effective in many more industries. Where coal was once impractical, it suddenly became economical. Coal use soared, even as the amount of coal needed for any particular application fell.

    On a global scale, efficiency advances could make modern conveniences more affordable. That’s a good thing for the standards of living of the world’s poor—for whom the cost of energy can make even basic necessities unaffordable. But if Jevons’ observations are any guide, we can’t count on efficiency advances to reduce energy consumption—or the attendant greenhouse gas emissions—by themselves.

    That’s not to say that resource efficiency is irrelevant to halting climate change—just that it’s only a piece of a very large and complicated puzzle.