Category — Jevons Effect
Much of today’s energy policy assumes that regulations mandating greater energy efficiency will reduce energy use. But that isn’t always the case, and energy efficiency improvements are seldom as large as promised by engineering calculations because of “rebounds.” Such is the most general conclusion from hundreds of studies pertaining to the effects of energy efficiency, whether market or nonmarket.
For example, people who install lighting that is 50 percent more efficient frequently leave the lights on longer, negating some of the energy savings from greater efficiency. This is called an energy efficiency rebound. Sometimes these mechanisms even bring about net increases in energy use known as backfires.
Rebounds have a direct implication for energy efficiency mandates and incentives. If rebounds are substantial, efficiency policies will be less effective at reducing air pollutants, for example, because the “saved” energy gets consumed elsewhere. Energy consumption may even increase on net to cause backfires.
Rebounds, and certainly backfires, fall into the ‘unintended consequences’ category of government intervention into the complex market. It is reason to ‘let the market decide’ with energy usage, as in energy production. [Read more →]
July 17, 2012 5 Comments