|January 16, 2012|
Energy Efficiency Rocks --- Rebound Effect Overblown
|Energy efficiency is an over-rated policy tool when it comes to cutting energy use and CO2 emissions---that's the basic message promoted by the US think tank the Breakthrough Institute (BTI), and amplified in major news outlets like the New Yorker and the New York Times. Their logic is that every action to conserve energy through efficient use leads to an opposite reaction to consume more energy---a "rebound" mechanism, which, according to the BTI, can negate as much as 60-100% of saved energy, and in some cases can backfire to increase net energy consumption.|
In this research note we refute this policy message and show that the BTI, as well as its champions in the media, have overplayed their hand, supporting their case with anecdotes and analysis that don't measure up against theory and data. Our fact-checking revealed that empirical estimates of energy rebound cited by the BTI are over-estimated or wrong, and they contradict the technological reality of energy efficiency gains observed in many industrial sectors.
We provide new statistical evidence to show that energy efficiency policies and programs can reliably cut energy use---a finding that is consistent with the policy stance of leading experts and organizations like the US Energy Information Agency (EIA) and the World Bank. Additionally, we take our policy message one step further---by using new insights from the emerging multi-disciplinary literature on "energy efficiency gap", we recommend that the world needs more energy efficiency policies and programs to cut greenhouse gases---not less as implied by the BTI and its cohorts in the media.