What is the efficiency paradox?

The proposition was first put forward by William Stanley Jevons in his 1865 book The Coal Question. In it, Jevons observed that England’s consumption of coal soared after James Watt introduced his coal-fired steam engine, which greatly improved the efficiency of Thomas Newcomen’s earlier design. Source: Wikipedia

Why is it that coal consumption soared after the efficiency improved? From an economic perspective, this should be perfectly obvious: as the efficiency of the coal engine increases, it becomes a cheaper option and is thus used at an increased rate.

The same is true with gasoline engines. The more efficient they become, the more likely it is that people will continue to use them. Even if the entire developed world spent tons of money to convert to electric cars and alternative energy, this would only make gasoline an even more viable option for countries which are still developing.

This summer, Tata Motors is releasing a $2,000 car in India called the Nano. It has taken a century for internal combustion automobiles to mature to a point where they can be produced at such low cost. The internal combustion engine is unhindered by patents and has been mass produced for almost 100 years. New electric engines are unlikely to hit that price point in the foreseeable future, and thus the fastest growing parts of the world are highly unlikely to choose them in an unregulated marketplace.

Energy efficiency will also decrease the price gap between the raising of livestock and the growing of plants. Considering the worst contributor of greenhouse gases is actually the livestock industry, this does not bode well for our planet.

Granted, in certain markets people’s habits do not greatly change as a result of efficiency gains. Hybrid car owners do not drive much more than regular motorists, and people who buy more efficient refrigerators are unlikely to use it more wastefully. Yet, the overall number of these machines purchased would likely increase and still cause any efficiency gains to evaporate.

If climate change is likely to cause significant problems for our civilization in the next century, we cannot expect the free market to correct the problem. If measures are not put in place to improve the competitiveness of carbon-neutral technologies, then drastic measures such as geo-engineering are inevitable.

The risks, moral hazards, and political implications brought forth by geo-engineering are going to be challenging indeed. Considering the overwhelming evidence pointing to humanity’s dangerous impact on the environment, we better prepare for this sooner rather than later. Geo-engineering must move closer to the center of the debate on climate change.

Other longer term options such as space colonization should also be considered. Interestingly, learning to live sustainably is a prerequisite for space colonization. Permaculture, recycling, vertical farming, energy efficiency, and the creation of harmonious ecosystems are key to living in space. NASA has known this for some time now, and it is time we start treating our situation here on Earth with as much foresight. Sustainability is key no matter what course we take.