Increasing supply is not the only answer to a stable energy future. Reducing demand through the improved efficiency of devices and procedures achieves the same effect.
The use of electricity is a dramatic example. During the 1970s, total U.S. electrical consumption increased 4.2% per year. In the 1980s, it grew only 2.6% annually, dropping to 2.3% in the 1990s. Current projections are 1.3% per year. That trend is partly a result of ongoing improvements in efficiency.42
Similar progress is visible in nearly every sector of the economy as a result of independent technological breakthroughs, directed research, government mandates and incentives, consumer education, or a combination of these elements.
One of the most impressive efficiency successes in modern memory is the result of the federal Corporate Average Fuel Economy (CAFE) standards established in 1975. CAFE standards stipulated that the average fuel economy for new passenger cars would be 27.5 miles per gallon (mpg) by model year 1985 – up from 18 mpg for model year 1978, an improvement of more than 50%.43 The U.S. Department of Transportation later stipulated that the average for light trucks would be 20.7 mpg. Automakers complied, dramatically improving the fuel economy of the nation's light-duty vehicle fleet, reducing dependence on imported oil, improving the nation's balance of trade, and reducing CO2 emissions. Had the CAFE standards not been enacted (and had fuel prices not increased), America's gasoline consumption would now be 14% higher than it is, or about 2.8 million barrels more per day.44
In December 2007, Congress passed an updated CAFE law mandating that new cars, SUVs, and light trucks together average 35 mpg by 2020, an increase of 40% from today's 25 mpg average. This legislation will further push technology, leading to greater fuel economy and reducing fuel consumption in the fleet.45
Automotive technology also demonstrates how developments and breakthroughs in fields unrelated to energy can have a profound effect on the energy sector. The electronics and computer revolutions of the 1960s and 1970s, which continue to this day, led to the development of very small sensors and computers. In addition, the ability to develop new materials such as catalysts – substances that prompt chemical reactions – led to ways to cut down on the pollutants in automobile exhaust (and in power plants). Putting these technologies together into systems on automobiles has led to more efficient automotive drivetrains, more power, better control, and lower emissions.
The continuing development of electronics, small electric motors, sensors, and computers is also contributing to the advancement of hybrid electric vehicles. Improved understanding of the combustion of fuels in the engine has led to more efficient engine technologies. At present, there are advanced technologies that have the potential to improve vehicle fuel economy substantially, but at a higher cost.
Refrigeration provides another case in which targeted research produced remarkable results: a reduction of more than two-thirds in the energy consumed by the household refrigerator during the past 30 years. In 1974, the average consumption per unit was 1,800 kilowatt-hours per year, and average sizes were increasing as well. At that point, a joint government-industry R&D initiative began looking for more efficient compressors, as well as improvements in design, motors, insulation, and other features.
The effort began to pay off almost immediately. By the early 1980s, electricity consumption per refrigerator had dropped by one-third and new developments kept coming. Even the changeover from ozone-threatening chlorofluorocarbons (CFCs) did not impede progress. Further design enhancements and tighter government standards since 1990 have saved the nation an estimated $15 billion in total electricity costs for home refrigerators over the entire life of the appliances.46
Today there are still enormous opportunities for efficiency gains across a wide range of products and processes. One area regarded as particularly ripe for improvement is lighting, which accounts for 18% of all electricity use in the United States47 and 21% of the electricity for commercial and residential buildings.48 Major research efforts are in progress to reduce those costs by using the same technology that now creates the glowing lights on appliances: the light-emitting diode (LED).
LEDs are “solid-state” devices made of materials similar to those in computer chips. They produce illumination by allowing electrons to flow across an electrical junction (the diode) and drop into a lower energy state, releasing the difference as light. LEDs generate relatively little heat, last 100 times longer than an incandescent lightbulb, and convert about 25% to 35% of electrical energy to light, as opposed to about 5% in a conventional incandescent bulb.49 Additionally, they do not require bulky sockets or fixtures and could be embedded directly into ceilings or walls.
At present, such systems are too expensive for broad commercial use. But if they can be made affordable, the effect will be dramatic. By one expert estimate, widespread use of LEDs would reduce consumption of electricity for lighting by 50% – a savings of about $10 billion a year in the United States. And it would reduce worldwide demand for electricity by 10%, an amount equivalent to about 125 large generating plants.50
Other researchers are exploring ways to make industrial and manufacturing processes much more efficient. Industry accounts for about 32% of all energy consumption in the United States, and seven energy-intensive industries use three-fourths of that power.51 As a result, public/private-sector partnerships and research programs are focusing on those areas.
One of the prime targets is the chemical industry, which uses 19% of all fuel consumed in the U.S. industrial sector.52 In particular, processes used to separate chemicals and to enable chemical reactions are being evaluated for possible savings.
A similar effort is under way in analyzing the energy-intensive forest products industry. Researchers have identified enhanced raw materials, next-generation mill processes, improved fiber recycling, and wood processing as candidates for improvements in efficiency.
Nonetheless, improved energy efficiency alone cannot solve all the nation's energy problems. Multiple parallel efforts will be needed, and that recognition has prompted intense interest in a wide variety of new technologies.
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