Transcript DRA Process Description

Rebound in US
Productive Sectors
Presentation to the CEDM Workshop
June 27th and 28th, 2011
Harry Saunders
Managing Director, Decision Processes Incorporated
Senior Fellow, The Breakthrough Institute
Embedded energy use dominates.
 Globally, about two-thirds of energy is
consumed in the production of goods and
services.
 End-use energy consumed directly by
households and for personal transportation is
only about one-third.
 Worrisomely, embedded energy consumption
in the US dominates and historically has
grown…
2
Embedded energy has grown in
the US.
Final Consumer Energy Use by Source
Energy Use, Quadrillion BTUs
US, 1987
70
60
Government Services
50
40
Purchased Products &
Services
30
20
Personal Transportation
Energy Use
10
Household Energy Use
0
Embedded
Consumption
Direct Consumption
Final Consumer Energy Use by Source
Energy consumption
embedded in goods & services
grew from 1987 to 2002
(58% to 60% of total)
Energy Use, Quadrillion BTUs
US, 2002
70
60
Government Services
50
40
Purchased Products &
Services
30
20
Personal Transportation
Energy Use
10
Household Energy Use
0
Embedded
Consumption
Direct Consumption
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Historically, rebound has been
substantial in the US economy.
200%
100% Rebound
Actual
250,000
150%
Zero Rebound
200,000
Rebound
100%
150,000
50%
Rebound
Energy Consumption
300,000
Rebound Across 30 US Sectors
100,000
0%
50,000
0
-50%
1960
1965
1970
1975
1980
1985
1990
1995
2000
Direct rebound in the productive part of the economy (that
part producing the goods and services) was large from 1980
to 2000.
4
Rebound can be mitigated with a
carbon tax.
 An energy tax can be found that offsets rebound.
 The tax must be large—roughly equivalent to a carbon tax
of $95/tonne of CO2.
 The result is stabilization of energy use, not a reduction.
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Rebound mitigation carries welfare
losses.
Weighted
average
across all
sectors
Real Output Gain/Loss vs. Energy Saved
(No Payroll Tax Offset)
10%
0%
-5% 0%
10%
20%
30%
40%
50%
60%
-10%
-15%
Employment Rate Gain/Loss vs. Rebound
-20%
(No Payroll Tax Offset)
-25%
-30%
% Energy Saved after 20 years
% Employment rate Gain/Loss
after 20 years
% Output Gain/Loss
after 20 years
5%
10%
5%
0%
0%
20%
40%
60%
80%
100%
120%
-5%
-10%
Long-term Rebound to be Offset
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Rebound accelerates climate change.
 Current models used for energy forecasting
ignore or improperly treat rebound.
 IPCC
 IEA
 Stern
 This means we have less time than we think
to devise climate change remedies.
 Rebound research needs are vast – the topic
is shot through with subtlety and complexity.
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