Tuesday, February 12, 2013

Dead Ball Game

Kenneth Gillingham, Matthew Kotchen, David Rapson and Gernot Wagner follow the bouncing ball and note that the second bounce, the rebound effect, after any efficiency increase is not very high.  The rebound effect is also known as the Jevons, effect, named after W.S. Jevons, who observed that any increase in efficiency leads to more use of a resource, in his case, coal in the mid 1860s.  Ethon bets, that if someone were foolish enough to put up the Benjamins, the Birdie could find some of the usual suspects using this as a standard lay back and enjoy it argument

Gillingham et al., observe that the bounce is usually low and depends mostly on cost.  You have to consider the cost of the replacement.  Funds spent there are not available either to buy more of the same, or in the case of increasing energy efficiency to buy something else that consumes energy.

They calculate that doubling fuel economy in the US will result in an efficiency gain of ~7% with a 2% rebound. 

Eli observes that Jevons made his observation at a time when coal was getting cheaper and more was being found as well as increasing manufacturing and mining efficiencies.  That is not the case today, either with coal or oil, in fact, increasing fuel economy standards are coming at a time when the costs of extracting petroleum and refining the lower grades that are being extracted are rising.  Thus one should on simple grounds expect much less of a rebound. 

4 comments:

David B. Benson said...

And GKRW do mention carbon pricing at the end...

Russell Seitz said...

Don't understimate the extent of potentially economic coal out Wyoming way- the depletion of the cheapest , which is all they've mined so far, leaves an abundance of the merely cheap and cheaper.

To get some idea of the gigatonnage, take a look at the NAS/NAE CONAES study, written a few years before the Energy Crisis turned into the Oil Glut.

crf said...

The problem is that people do not recognize that Jevon's paradox and efficiency are very uninteresting questions in the grand scheme of climate mitigation. And most people using those terms talk past one another, since how you can define them is slippery, with one definition or the other being tied very strongly to micro-policy situation under investigation and study assumptions. Jevon's paradox is fuzzy.

Coal to liquids could end up being cheaper, in real terms, that any oil being used now. If you think that will result in people using, to a degree significant to the climate, less or more of the stuff, because of an understanding you snatched from an argument between the breakthrough people and some sustainability people, who are mainly taking past each other with regards to Jevon's paradox, then you need to give you head a little shake.

Howsoever you care to measure Jevon's paradox in a particular application, it is likely utterly irrelevant to climate change mitigation. And apart from the fact that anyone who includes a "wedge" called "efficiency" in a worldwide climate stabilisation scheme has not first proved that they are not deluding themselves, how much is the rebound effect going to alter that wedge: probably very little either way.

Just look at world history: everyone, everywhere, uses more energy, year after year. Nobody has shown that Jevon's paradox matters the slightest in the big scheme of things. It's tic-tac stuff.

As a psychologist might say, you need a vacation from even thinking about Joe Romm and the Breakthrough Institute (because that's where I think this fixation comes from -- am I wrong?). I don't care. The world doesn't care. Why should I care?

EliRabett said...

Given fluorescents and other such, everyone using more energy everyday may not be such a safe bet.