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Is Energy Efficiency Really Good? (A Look at the "Rebound Effect")

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new energy efficient light bulbs

You would think, intuitively, that energy efficiency is good — it saves us money and helps to protect the environment. But sometimes things are not as you would intuitively think they are, and some have claimed that energy efficiency is one such thing. Some have claimed that energy savings created from greater energy efficiency are offset by subsequent activities demanding more energy.

Let me explain with an example or two. The theory, known as the “rebound effect” or “Jevons paradox” (there is a difference, which I’ll explain at the end of this article), would postulate: if a person bought a highly efficient car that would result in energy savings of 10%, that person would end up driving so much more, or so much faster, that he/she would increase his/her usage so much that the 10% energy savings would be lost and he/she would end up using more energy than with a normal car.

The same theory is applied to energy-efficient light bulbs, energy-efficient machines, etc.

Jevons Paradox Doesn’t Hold Up in Real Life

While people may increase usage some after switching to a more energy-efficient technology, research has shown pretty conclusively that they don’t do so nearly enough to considerably offset the energy savings. Thus, they do end up decreasing energy usage, not increasing it, in the end.

One seemingly pseudo-environmental research institute, the Breakthrough Institute, recently made a lot of assertions in support of Jevons Paradox, but a number of leading energy experts quickly responded and the Breakthrough Institute, apparently, can’t hold their ground discussing the topic with these true experts.

Here’s a lengthy response to the Breakthrough Institute from Jonathan Koomey of Stanford University and a little commentary on it and on the Breakthrough Institute from Dr. Joe Romm of Climate Progress: Rebound effect: The Breakthrough Institute’s attack on clean energy backfires.

David Goldstein and Ralph Cavanagh, another two leading experts on the topic and co-directors of NRDC’s energy program, each of which have been “working to implement energy efficiency at the national and state level since the 1970s,” continue with the debunking here: Energy efficiency and the ‘rebound effect’.

Real Climate Economics expert Dr. Jim Barrett also joins in on the debunking: Debunking the Jevons Paradox: Nobody goes there anymore, it’s too crowded.

And here’s an article from September 2010 by Evan Mills, a leading scientist at Lawrence Berkeley National Laboratory, debunking the same issue after a poor piece by The Economist on the topic of energy-efficient lighting and the rebound effect: Efficiency lives — the rebound effect, not so much.

What’s the Difference between the Rebound Effect and Jevons Paradox?

The rebound effect is really just referring to the theory that 100% of energy savings from improved, more energy-efficient technology sometimes do not occur due to increased usage or change of behavior.

This could mean that 90% of the savings are still achieved, or 70%, or -30%. It does not specify how big the rebound effect is.

The Jevons Paradox claims that the rebound effect is higher than 100% (in other words, more energy is used than is saved)…

While there is a technical difference, the “rebound effect” is commonly used interchangeably with the Jevons Paradox with the meaning of the latter.

Concluding Point

Don’t be fooled, things aren’t always not as they seem. 😀

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Photo via NeoGaboX




8 comments
  1. Name (required)

    You bring up a good point, the “rebound effect” is also referred to as ‘induced demand’. Induced demand is due to several factors but it is mainly increased value that increases demand. Lower price may not increase demand if the lower price reduces quality or other benefits. If cost is reduced, AND benefits increase, there could be an increase in demand IF the market is not saturated. In a saturated market with several competitors offering the same product, the only way to increase demand is to improve value so the demand falls for the low value products.

    In the case of light bulbs, it is clear that the main benefit is light. If ones home is sufficiently lit up, that particular market for light is saturated — so lower cost (and or / longer bulb life) will win market share (CFs displace incandescent) — great energy savings is the main benefit of CF — value is increased — the light market is still saturated, so not much increased demand for light — the new demand is for efficiency (not light). If the market for light is constrained by bulb cost and energy cost, then it is very likely that a quantum improvement in bulb life per dollar (or energy efficiency) couple result in increased energy use for lighting because of expanding an unsaturated market.

    The same applies to transportation. Steam power in the late 1700s, and early 1800s displaced muscle power transportation due to major value improvement in transportation. Steam power was far less cost than muscle power — but river boats (and later trains) opened up so much new opportunity that much more energy end resources were used on transportation than with muscle power. By about 1880 the market for trains was nearing saturation, but overshoot occurred due to rail promoters understating costs of new expansions and overstating likely revenues.

    The same thing happened a hundred years later with the introduction of automobiles and aircraft. They offered much greater transportation value than trains and river boats. They offered increased benefits of accessibility, much lower initial and operating costs, and much faster speed, so they displaced trains and boats, (just like steam displaced muscle power). Even though more only slightly more energy efficient than trains for passenger travel (and in spite of less energy efficiency for cargo), cars and jets have greatly increased energy use because of the leverage in standard of living improvement that they offer (the net benefit is much greater than the costs – so spending more to travel more allows even greater income — and much induced demand or “rebound effect”. Just as trains and river boats hit market saturation (marginal ROI on continued expansion), so are cars and jets now in market saturation, and expansion will require lies (or government subsidy — another form of lie).

    Fortunately, there is a proven technology (Evacuated Tube Transport ™) that can provide 50 times more transportation per unit of energy than trains, ships, cars, or jets, and at less than 1/10th the cost, so in spite of the induced demand, energy savings will be greater than the induced demand from lower costs (unlike with the displacement of high cost trains by low cost cars).

  2. Thomas - Electric Car

    Therefore it would be good to receive a feedback about the individual energy usage. For example a Toyota Prius shows the gas demand on the fly. Therefore you have the possibility to use the efficieny of the car by driving more or less the same style than before or losing this efficiency effect by driving much faster than before without any advantage.
    But with the Prius its really hard to reach an energy demand in the same dimension than comparable conventional cars.

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