News Flash: Americans Use Less Energy When It Costs More

The following post was written by Allison Bailes on his excellent blog Energy Vanguard and can be seen here.  It is being re-posted with his permission and fits in nicely with our last post titled Costs of Clean Energy vs. Dirty Energy.


I wrote about energy conservation versus energy efficiency last year and showed how things had stayed pretty level over the past three decades as we've spent our efficiency dividend on bigger houses and more electronics. Still, I had trouble believing we were actually using less energy per person than we did in 1970.

So I did what I always do when faced with a question like this. I went to the best source for energy data about the US: the US Energy Information Administration. Here's what I found (pdf):

energy data us consumption per person 1949 2009

Indeed, we do seem to be using less energy per person than we did in 1970. Wow! The shape of this graph tells a lot of American history, too. There's the sharp increase of the '50s and '60s as we suburbanized and accessorized. Then the two bumps in the '70s showing the downturns after the Arab oil embargo of 1973 and the Iranian revolution of 1979. Then followed the slow rise in energy consumption of the '80s and '90s as our economy recovered and took off.

Then, at the turn of the new millenium, energy consumption flattened out and turned down. We started using less energy per person. The decrease is mainly coincident with the economic downturn of the past few years.

Another graph from this same EIA document showed our expenditures per person over roughly the same time period:

energy data us expenditures per person 1970 2007

Well, there's the answer. Energy costs have been rising sharply since the year 2002. The only dip in the new millenium followed the attack of 11 September 2001, when the economy tanked for a bit.

The moral of the story: High prices influence behavior. The back story is that the days of cheap energy are over. Peak oil is a big part of the reason for that.


I'm a firm believer in basic economics.  If something costs more, people will use less of it.  If energy is cheap, nobody will try and conserve it.  The question is: What price of energy accounts for all negative externalities associated with dirty energy production while also being affordable for the public?

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