Energy and Materials Efficiency: Shortcut to Sustainability or Postponing Hard Choices? February 19, 2007Posted by Michael Hoexter in Efficiency/Conservation, News and Events, Sustainable Thinking.
Tags: Energy Efficiency, energy sustainability, Materials efficiency, paradox of efficiency, utility maximization, William Stanley Jevons
News of last few weeks points to a building consensus in the U.S., historically the home of cheap energy and profligate energy waste, that energy efficiency is not only a good thing but it is the next good thing. President G.W. Bush, not the most consistent or far-sighted advocate of green technology, has ventured in the 2007 State of the Union address that CAFÉ standards might be raised to increase fuel efficiency, albeit in a not particularly aggressive way. Bush, in subsequent remarks, has trotted out his plans to increase our energy efficiency primarily as part of the effort to reduce foreign entanglements but also, in a first for his Administration, to deal with “climate change”. Almost any business leader who ventures to talk about climate change and corporate responsibility will now cite energy efficiency as one, if not THE, prime strategy for addressing the emissions of greenhouse gases. There is now a storm of marketing efforts in the home building market pushing the efficiency aspect of materials, systems. On a personal note, I am currently working on a project related to energy efficiency in commercial kitchens, which I will discuss in a later post.
In the catalog of the aspects of sustainability I created (blog posts of October 10th and 12th), I placed what I called “Efficiency/Conservation” as the 4th most central aspect of ecological sustainability:
- Balanced exchange between humanity and nature
- (Holistic) Systems thinking (“everything is connected”)
- Long Time-horizon/Responsibility for the future
- Greener Innovation and Invention
- Biomimicry and Biophilia
- Linking and Valuing the Local and the Global
As a practice, particularly on an organizational or corporate level, energy and materials efficiency takes on a much larger role, as they are concepts that can be measured and practiced on a day-to-day basis. The potential measurability of efficiency is an advantage for its usage in regulations, and establishing attainable social and corporate goals.
Though the central concepts in sustainability in my catalogue, “Balanced Relationship with Nature” and a “Holistic Systems View” of life and work, may yield fundamental insights into what is or isn’t sustainable on a global scale, Efficiency and Conservation have a powerful ally from the world of contemporary business and economics: Efficiency is one of the central characteristics of a profitable enterprise. Businesses and other organizations responsive to a purpose or goal have priorities that rival efficiency in importance but it is near the top of the list.
In business, efficiency is not solely energy and materials efficiency but it is also time, labor, and cost efficiency. These efficiencies can compete with one another in some projects and project areas but can also work together with each other in other areas and at other times. Time efficiency often necessitates the use of energy intensive means of transporting goods, like the use of airfreight or air travel. Materials efficiency might mean manual separation of waste materials and therefore not be as labor and cost efficient as old-fashioned waste removal. Sustainable businesses will need to balance the costs associated with raising the priority of material and energy efficiency over other competing efficiency goals.
Efficiency, unlike “balance with nature” or “holistic thinking”, can be measured fairly easily, especially when describing a machine or fairly simple physical process. Efficiency is sometimes used as an umbrella concept for the related concept of efficacy, which describes whether and how much of a desired effect is produced with a given input.
In this case, the units do not have to be the same, so we can get familiar terms like “miles per gallon” or, in Europe, “liters of petrol per 100km traveled” (which flips the equation on its head as less liters is more efficacious than more liters).
A stricter definition of efficiency in scientific and engineering terms measures the input and output in the same units (energy units usually). If the input and output are measured in the same units, you are able to determine the percentage efficiency of the system or device by multiplying by 100.
With materials efficiency, there is currently less publicity than with energy efficiency as it seems less central to the looming climate crisis. Materials efficiency also varies more from one application and economic sector to another. A multidimensional measure of materials efficiency might include the following aspects: percentage of new material, percentage reused/recycled material, water used in production and transport, percentage organic or non-toxic production process, proximity of material origin (really closer to energy efficiency and other concepts). but lately more attention has been paid to the amount of water required to grow crops or other desirable outcomes
When we start to look at more complex processes that involve people and a complex set of variables, measuring efficiency/efficacy becomes more complicated and diverse. Many analytic instruments in economics and finance are trying to get at efficiency/efficacy using monetary and other variables as part of the equation.
Efficiency and Maximizing Economic Utility
“Utility maximization” is economists’ best description for what drives economic activity: the compound effect of human desires and needs tempered by their varying ability to be realized in any given situation. “Utility” is the black box of economics, describing what people want from each other and the earth and how they push forward in trying to get some of what they desire realized. The word “utility” is adopted from the classical utilitarian philosophers who founded the economic profession by theorizing about and eventually studying what drove people to work and trade with each other. Economists avoid where possible defining what utility is and instead accept it as a given.
The measurement of efficiency also leaves out of the picture, evaluative judgment about what is desired. “Useful work” or “effectiveness” are accepted as givens or defined by others. The torque provided by an engine or motor or the heat provided by a furnace is the purpose for constructing these gadgets in the first place, so it is fairly non-controversial to accept the output of torque or heat as the one desired and desirable outcome for these devices. Efficiency then is one route to utility maximization, especially when the costs of that maximization are factored into the ultimate utility equation.
The agnostic nature of efficiency with regard to ultimate ends meshes well with businesses’ ultimate goal to serve the ends of their customers and stockholders and not to exercise evaluative judgment about those ends. While inspiration and creativity are important in ultimate business success, efficiency in execution is a prime pre-occupation for departments as diverse as finance and operations, contributing a great deal to ultimate success and competitiveness.
The Paradox of Efficiency
Increasing materials and energy efficiency then sounds like a paradise for a greener sustainable economy that is not too unlike our current one. By increasing our energy and materials efficiency we can then continue to serve an unlimited growth in (economic) utility for growing numbers of people throughout the world.
But wait…there is a well-established literature that has found that rising efficiency does not slow consumption of energy or material resources. Called the paradox of efficiency or the Jevons paradox after 19th century economist William Stanley Jevons, it seems that increased resource efficiency lowers the cost of a good or service and then people use it more. Examples include the increase in jet fuel consumption despite rising airplane efficiency as well as the steady increases in fuel consumption in the US over the last few decades despite overall efficiency gains in engines. Some advocates of sustainable transport planning are even opposed to instituting efficiency standards for automobiles, instead seeking to limit demand by increasing the cost of automobile use through congestion charges, fuel taxes, automobile insurance that is pro-rated for automobile usage.
Does a greener economy entail then a limitation of demand, tinkering with utility’s “black box”, to stop people from eating up the planet with their urge to consume? Is an emphasis on efficiency too easy, encouraging a postponement and a devaluation of the hard choices we need to make between essential, sustainable economic activities and frivolous, wasteful ones?
As a strategy in and of itself, increased materials and energy efficiency is insufficient to arrive at a sustainable economy. Still it is an indispensable tool AMONG OTHERS for to help us to create a more sustainable society. Increasing efficiency is about eliminating wastefulness, one of the prime characteristics of an unsustainable economy.
However, increased energy and materials efficiency is not a panacea…the paradox of efficiency shows us that left by itself efficiency only serves to cheapen goods and services that then boost overall consumption on a macro-economic level, especially in a world where the vast majority of the world’s population is now hoping to enjoy the luxuries now restricted to the wasteful few in the US and other industrialized countries.
In the area of energy, increased efficiency CAN potentially lighten the burden which a new cleaner energy infrastructure centered on renewable energy sources like wind, solar, biomass and ocean energy would power. Efficient energy conversion devices (like more efficient motors and heat sources) and regulating and reducing per-person and overall energy demand will allow us to reach a carbon neutral economy sooner. In the area of materials, lower materials use per “unit” utility will allow people to gain similar or greater satisfaction of their wants with less impact on the world as a whole.
Beyond decreasing the overall cost to the planet of each of our individual satisfactions, even as we grow in number and in expectations, we will need to continue developing new, cleaner sources of energy and materials. An efficient use of gasoline or other fossil fuels still increases overall carbon emissions if increasing numbers of people hop into cars that run more cheaply. Shifting to an electricity based economy powered largely or entirely by renewables, would lead to massive decrease in our carbon emissions and dependence on fossil fuels. Efficiency in and of itself cannot shift use to such an economy but, as it turns out, useful work performed by electric devices is in most cases more efficient than the same work done by heat engines fueled by fossil fuels. The shift to renewables and electricity requires a paradigm shift and to some degree a power shift among industry sectors and activities.
Energy efficiency is a point where many can agree but we may also need to step into more controversial areas that involve re-thinking what we value and demand from others and from the natural world. More on this in future posts.