Morgan Williams taught me about a couple key concepts at Balaton: energy rebounds and energy amplifications.
Increased energy efficiency is an obvious good, allowing us to do more of the things we want to do at less cost and with a smaller ecological footprint. But it turns out that for a variety of reasons, people rarely merely implement improved energy efficiency and get on with their lives. Instead, one of two things often happens: either they end up again using more energy (their energy use "rebounds"), or the start down a path where they use even less energy (their energy efficiency is "amplified"). As Future Currents puts it:
When people save money by improving energy efficiency, or by cutting back their energy use, they have more money to spend. How they spend this money influences whether there is a rebound or an amplification effect, and the size of that effect. For example, if someone spends the money they saved on buying lots of aluminium, which is produced with large amounts of electricity, the rebound effect may be so large that total energy use goes up. However, if that person invested their money into further energy efficiency improvements, the savings would be amplified. Within this spectrum, goods and services vary considerably in the amount of energy needed to provide them. ...Energy use is still growing in many countries despite improvements in energy efficiency.
To use concrete examples, let's say that two people, Ms. R and Ms. A, have both decided to save energy and have taken the big basic steps one does -- replacing their light bulbs with compact florescents, buying energy efficient appliances, putting electronics on power strips to avoid vampire power drains, checking their homes' insulation and the like. Both will usually see significant savings. It's what they do next that makes all the difference.
Ms. R decides that she's been good, and money's looking flush, so she's going to get rid of her efficient little car and buy that SUV she's always secretly wanted. As a result, her gas use skyrockets, and, in fact her total energy could potentially even go up compared to what she was using before she began. This is rebound.
Ms. A, on the other hand, decides that she likes saving money on energy efficiency, and decides to use the extra money she has on buying a zero energy home, knowing that it will, over time, save her even more money though increased energy efficiency. This is amplification.
Since one of our big goals has to be increasing our energy intensity -- getting richer faster using less energy -- figuring out how to encourage more amplification and less rebound is pretty important.
New Zealand is exploring one way to reduce rebound and add amplification, particularly by encouraging people to invest in "cost-effective energy efficiency improvements that have very long payback periods." But this would also seem to be an area where making visible the invisible (perhaps be making the two patterns clearer to people through social marketing) could lead to people consciously deciding to amplify their own behaviors.
Well, the economist's version of this is the rather well-known Jevons paradox. What it really depends on are the economic parameters surrounding the products of the new more efficient process. Efficiency cuts costs, which pushes production higher on the supply-demand curve and may lead to increased, rather than decreased, net resource use.
That's the industrial supply/demand scenario version, but the same economic considerations apply in personal choices as well. If a more efficient car makes it less expensive for us to drive, we will inevitably drive more.
That's why regulatory enforcement, such as the "carbon freeze" Al Gore was talking about, is a much surer way to ensure the outcome you're looking for, than simply pushing for more and more efficiency...
Energy amplification - great idea, and a solid response to those who say that the Rebound Effect (aka Jevons Paradox) renders efforts at efficiency pointless.
Alex's post described how savings from efficiency could be invested in futher energy-reducing technology. Could I point out another strategy? Namely, not buying anything.
If one's expenses are reduced, it means that one is under less pressure to work at a paying job. Perhaps one parent can afford to stay home and take care of house and children. Or an older person can retire early. Or one can downshift from full-time work.
As the people in the simple living movement have discovered, there can be a "virtuous circle". Lower expenses -> less need to work -> less need for clothes, transportation and stress relief -> more time to do things for oneself -> lower expenses....
The efficacy of this strategy will become even more pronounced as energy prices increase.
Alex, there's a Danish researcher at the Technical University of Denmark at Lyngby, named Jorgen Norgaard. He's was a friend of Dana Meadows, and is a friend of Dennis Meadows. He has done a lot of work on this, with a number of papers in English. Dennis likely can put you in touch with Jorgen.
Back in the day, the Urban Solar Energy Association did solar barnraisings in various neighborhoods around Boston. When we did follow up studies of what happened to the energy bills of people with site-built air heaters and sunspaces and the like, the data showed greater savings than anticipated. It seems that the families that were interested in putting solar on their homes became more aware of their energy usage and continued to reduce it beyond the solar portion.
Urban Solar Energy Association lives on as the Boston Area Solar Energy Association (http://www.basea.org). Mostly what it does is a monthly lecture series, an annual solar cooker picnic, and the Junior Solar Sprint, solar model car races in the schools.
"If a more efficient car makes it less expensive for us to drive, we will inevitably drive more."
The word "inevitably" makes that statement false. People are not strictly rational in economic terms. For example, if your car insurance goes up 10% (for no good reason), do you alter your driving in any way? If your car insurance drops 10%, do you alter your driving in any way? [for the sake of arguement assume that the 10% difference does not cause financial hardship]
Look at it from a bit more historical perspective and the "curse of efficiency" stands out more clearly. Candles are a hugely inefficient source of light, yet in Shakespeare's days energy spent per capita on artificial light was puny. Flying is also a nice example: a 747 stuffed full with travellers provides transport more efficiently than a car, in terms of energy spent per passenger-kilometer. But who would argue that aeroplanes have reduced our transport energy needs?