[BETA] Fortnightly

Federal data suggest it's not so in an "electrifying" economy.

Energy-related carbon emissions in the United States remained relatively flat last year, despite 4 percent U.S. economic growth. Although one year's data does not a trend make, the federal statistics seem to fly in the face of the notion that strict emissions cuts threaten the economy by raising energy prices and unemployment. Instead, says technology strategist Mark P. Mills, the figures evince a decade-old shift toward an electricity-driven economy.

According to the U.S. Energy Information Administration, carbon emissions from burning of fossil fuels were up just 0.4 percent from 1997, or from 1,479 million metric tons of carbon to 1,484 MTc. The primary energy mix for power generation changed little from the previous year, according to preliminary estimates.

According to EIA economist Perry Lindstrom, several factors contributed to low emissions growth in 1998. He says, "Most of this low growth can be attributed to energy intensity declining rather than carbon intensity declining." Carbon intensity has been on the rise since 1995, adds Lindstrom.

"[The 1998 data] isn't really different from what's been going on for a decade," says Mills, senior fellow with the Competitive Enterprise Institute. "The economy grew significantly, consumption of electricity grew significantly, but carbon emissions didn't grow very much."

Mills explains, "The data clearly show that the economy is electrifying, and that's largely because we've moved to an information economy." The information economy, which relies on computers, Internet commerce and variety of information-based equipment, is reflected on the supply side by increased electric demand, he notes.

Glenn R. Schleede, president of Energy Market & Policy Analysis Inc. in Reston, Va., agrees that electricity usage is on the upswing. He notes a diversion between energy use and economic growth that goes back 20 years.

"With the exception of electricity, the use of various energy sources has not kept pace with economic growth," says Schleede. "The economy just does not require as much energy per unit of GDP."

Like Mills, Schleede notes that the high-technology businesses that comprise a large chunk of the U.S. economy are less energy-intensive. He adds that many energy-intensive businesses have been moved overseas.

The reason this shift to an "electrifying economy" has received little notice, according to Mills, is that it is in conflict with the U.S. Department of Energy's initiative to reduce fossil fuel emissions. "It's not a trend that's helpful to their case because information-economy GDP growth is joined at the hip to electric growth, which continues to be dominated by the use of fossil fuels."

Regina R. Johnson is managing editor of Public Utilities Fortnightly.

Articles found on this page are available to Internet subscribers only. For more information about obtaining a username and password, please call our Customer Service Department at 1-800-368-5001.