The last 30 years in America have seen great improvements in the energy efficiency of electric motors, appliances, and other end-use equipment. Think of compact fluorescents, ground-source heat pumps, and thermal window glazing. Add variable speed drives, chilled water AC, and high-pressure sodium street lighting. You name it, we've got it.
But energy efficiency is no saving grace. Like a dieter who keeps gaining weight, our consumption of electricity continues to climb despite our efficiency gains, leaving our environment worse as a result.
Since 1969, we have created and promoted electric efficiency through the Department of Energy, various state energy offices, and the Environmental Protection Agency. We have enacted various energy efficiency tax credits, the Model Energy Code, ASHRAE Standard 90, appliance labeling, EPA's Green Lights and EnergyStar programs, a shared savings industry, and Energy Rated Homes.
Yet in the residential sector, we now consume 58 percent more kilowatt-hours (kWh) per individual electric meter than we did 30 years ago: 10,388 kWh per residential meter in 1999, versus 6,571 kWh in 1969, according to the Edison Electric Institute and its statistical yearbooks. The same source reports that power consumption per commercial meter was up 88 percent over the same period. Overall, the EEI data shows that the number of kilowatt-hours sold per American electric meter increased overall almost 40 percent in 30 years. But the increase in the amount of electricity available for consumption-up 2.4 times, or 144 percent, from 1969 to 1999-is even more astounding.
This is no environmental triumph. Yet few, if any, environmentalists dare question the gospel of improved efficiency, or discuss alternatives. They say instead that energy efficiency produces environmentally benign energy faster and cheaper than any other source of energy. I say we just waste more and more electricity, only more efficiently than before.
The proponents of improved energy efficiency argue that if only we do more with less, we won't ever have to face resource constraints. They say that improved energy efficiency is cheaper, faster, and environmentally cleaner than other additions to electric supply. Efficiency seems virtuous, similar to godliness, cleanliness, patriotism, mom, and apple pie. It is fundable, politically correct, popular, and clean. But improved electrical efficiency has not worked.
With all these improvements in electrical efficiency, and all the programs that promote them, electricity used per American electric meter should have dropped, but it hasn't.
Congress passed the National Environmental Policy Act in 1969. Then came OPEC, the oil embargo, and Three Mile Island. Oil production in the lower 48 states peaked in 1970, and since then we have known that oil and natural gas are limited resources. So, America found and imported more oil and gas, strongly motivated by oil price hikes in 1973 and 1978. Quietly, efficiency became one "source" of energy. But, is it?
Consider the notion of using demand-side management to create new energy resources-a cannon of environmentalism since the mid-1980s. Chart 1 shows the surprising results. The peaking line represents DSM expenditures reported by the Energy Information Administration, and the straighter line represents generated kilowatt-hours per meter reported by EEI. As you can see, all that money spent on DSM programs had no apparent influence on the number of kilowatt-hours of electricity consumed per meter.
To rationalize the huge increase in electric use, DOE, and even some environmentalists, state that improved energy efficiency is good because we are now able to produce more dollars of gross domestic product than before, using the same amount of energy. It may be true, as far as it goes, that GDP per kWh is rising. But ratios don't tell the whole story. The environment, however, dances to a different tune.
Environmentalists like to quote ratios. Here are some examples: miles per gallon, lumens per watt of light, SEERs and EERs for air conditioning, and energy per dollar of GNP. If we improve these ratios, we are off the hook; we don't have to shut down power plants. But to reduce the rate of toxins emitted per year, coal, oil, nuclear, and gas-fired power plants need to be shut down.
In other words, the environment is not made better with more lumens per watt of light; it is made better with fewer kilowatt-hours generated. Our environment is not made better with greater miles per gallon of gasoline; it is made better with fewer gallons combusted. By improving the miles per gallon, cars should pump less carbon dioxide into the air. However, we have chosen to drive alone, to drive more, to drive further and faster. While gallons per car per year declined 27 percent since 1970, we inhale 29 percent more carbon dioxide from gasoline burned by our car engines.
From the pollution point of view, each of us could own any number and type of car, even if they are huge SUVs that are badly out of tune, as long as we don't turn the ignition key and drive them. The environmental culprit becomes the small, fuel-efficient car that consumes a lot more gasoline per month compared to the Hummer that is parked.
Yet, since 1969, we have benefited from electricity to the extent that whole parts of our lives now depend on electricity-communication, security, information, banking, food preparation, entertainment, health and comfort-to name a few. And, the loads we add are much more efficient than past additions. So we increasingly waste electricity more efficiently.
On top of all this, the generation of electricity is inherently inefficient. We can't run a washing machine on coal or a computer directly on fuel oil, yet electrical generation is its own environmental downfall. Why?
While one kilowatt-hour provides 3,413 BTUs at our electric meter, it takes just over three times the fuel input BTUs to generate that kilowatt-hour. This "heat rate" for electrical generation from fossil fuels has stayed about the same over 30 years: 10,457 BTUs per kilowatt-hour in 1969 and 10,301 in 1999. Applying heat rates to all generated kilowatt-hours since 1969, however, shows an ever-increasing amount of fuel input (see Chart 2).
The lower line in Chart 2 shows the kilowatt-hours generated, and the upper line shows the kilowatt-hour equivalent of energy input necessary to generate the kilowatt-hours in the lower line (all data is from EEI statistical yearbooks).
The upper and lower lines diverge in Chart 2, showing that it takes an ever-increasing amount of raw energy to generate the kilowatt-hours we use, doubling the raw energy in 30 years. This means that the more electricity we use, the more energy we waste. If we double our use, our waste increases by a factor of seven.
In the past 30 years, electricity available to America has actually increased by 2.4 times. In this same interval, the total energy each American consumed annually increased only 9 percent, from 326 million to 355 million BTUs, according to the EIA. Yet, over the same period, per-person consumption of kilowatt-hours climbed 95 percent, from 7,116 in 1969, to 13,883 in 1999. That implies that gains made in saving energy in all other sectors of our economy have been overwhelmed by our increases in electric use.
We often hear that the more we use efficient electric equipment, the more we "save." Those who promote efficiency tell us that benefits from efficiency are like finding $20 bills on the sidewalk. They say that each kilowatt-hour saved is equal to a kilowatt-hour generated. They even tell us that the value of saved kilowatt-hours is negative, like a lunch we are paid to eat.
All this is mythical. The saved kilowatt-hours are additive, not subtractive, to the increasing generated kilowatt-hours. These promoters are really soothing our increasing addiction to the serv-ices that electricity supplies, even though we become less free, more dependent, more wired, and more polluted.
Electrical efficiency fails because it insulates us from the experience of saving energy. Newer products have additional options and choices, improved speed, and compactness. The benefits from using electricity more efficiently become inherent in the opaque design of the increasingly complex technology, not in its use. We consumers are asked merely to purchase more stuff, like EnergyStar appliances. Efficiency, therefore, makes us passive participants in saving electricity. But this is no substitute for lifestyle change; it is at most a postponement.
Conserving electricity is different. It means we choose not to use electricity, even for a moment. By turning off the switch, conservation makes us active participants, not just passive consumers, in saving electricity.