The implications of rebound effects for sustainability

Transcription

1 The implications of rebound effects for sustainability Steve Sorrell Sussex Energy Group, SPRU, University of Sussex RESOLVE Conference, London, 18 th June 2009

2 Propositions Rebound effects matter Policy can mitigate rebound effects Jevons Paradox holds in important cases Energy drives economic growth Efficiency must be combined with sufficiency Continued growth in rich countries is incompatible with sustainability Increasingly controversial!

3 Rebound effects - consumers Indirect Embodied energy Lower petrol bills Holiday in Spain More energy Less energy Direct Lower running costs Driver further or more often (or in a larger vehicle) More energy

4 Reinforcement of rebound effects

5 Rebound effects - producers Indirect Embodied energy Lower cost cars More car travel More energy Less energy Lower cost steel More steel production More energy Direct

6 Economy-wide rebound effect Counterfactual energy savings Actual energy savings Indirect rebound effect Economy-wide rebound effect Direct rebound effect

7 Two blind spots Energy efficiency may be measured in a variety of ways for a variety of system boundaries So rebound effects depend on how energy efficiency is defined Improvements in energy efficiency rarely occur in isolation So rebound effects need not be small just because the share of energy in total costs is small

8 Rebound effects matter Direct: 30% or less for car travel and space heating/cooling. Smaller for most other household energy services But: Only limited time periods studied. Marginal consumers ignored. Only subset of variables measured. Few studies of producers and/or households in developing countries. Economy-wide: Diverse CGE/econometric modelling studies suggest 25% to >100% But: Depends on nature and location of energy efficiency improvement. Sensitive to assumptions. Assumes only pure energy efficiency improvements Variable, significant and potentially larger than current studies suggest

9 Policy can mitigate rebound effects Policy targeting and headroom Progressive efficiency standards Carbon pricing Cap and trade schemes

10 Jevons Paradox holds in important cases Improved efficiency of steam engines Lower cost steam power Greater use of steam engines Steel-making Coal-mining Lower cost steel Lower cost rail transport Lower cost coal

11 Energy drives economic growth Main source of productivity improvements Productivity of energy inputs Scope for capital-energy substitution Decoupling of energy consumption from GDP Orthodox Exogenous or endogenous technical change Proportional to share of energy in value of output Substantial and indicated by substitution elasticities estimated at the sector level Has already occurred, with considerable scope for further decoupling Ecological Increasing availability of highquality energy, both directly and embodied in capital equipment and technology Greater than the share of energy costs in the value of output Limited and overestimated by substitution elasticities, since these neglect embodied energy Overstated in part because conventional measures neglect energy quality. Limited scope for further decoupling.

12 Efficiency must be combined with sufficiency If consuming efficiently or differently has limits, what about consuming less? Multiple benefits, but multiple obstacles Lock-in; rapid obsolescence; desire for status and positional goods; loss aversion; adaptation of aspirations to higher incomes; production & consumption of novelty; etc. Need financial security, deeply held values and considerable determination And sufficiency also has rebound effects

13 Continued growth in rich countries is incompatible with sustainability Limited historical evidence for decoupling, plus implausible scale of required decoupling e.g. Global CI reduced by 96% by 2050 Rebound effects and contribution of energy to economic growth reinforce the case for exploring alternatives Need better understanding of the structural drivers of growth including the debt-based monetary system

14 Reprise Rebound effects matter Policy can mitigate rebound effects Jevons Paradox holds in important cases Energy drives economic growth Efficiency must be combined with sufficiency Continued growth in rich countries is incompatible with sustainability

15 UK Energy Research Centre

16 Decoupling? Year GDP Primary Energy Use Quality Adjusted Final Energy Use Index (1947=100)