David Owen’s Efficiency Views Rebound With Error

David Owen continues to blame energy efficiency for the ills he ascribes to growth and wealth.

His misunderstandings of “rebound” in energy use were devastatingly rebutted when he published them in The New Yorker, and now he’s expanded them to book length. But his post in last week’s Wall Street Journal lucidly confirms that his big issue is much less with using energy efficiently than with the things people often choose to do with energy. In essence, he is echoing all major faith traditions’ warning against materialism—against what Ecclesiastes expressed as “He that hath silver shall not be satisfied with silver, nor he that hath abundance with increase; this is also vanity.”

Of course, the economic growth Owen decries is boosted not just by energy efficiency but also, and far more, by many other things he doesn’t choose to criticize, such as education, public health, capital markets, and technological innovation. He is right that consumption has impact, and that one way to reduce impact is to consume less or differently. But he is dead wrong that using energy more productively has the perverse effect of increasing its use, eliminating or reversing the benefits sought: this has never been observed, and a vast literature shows that actual “rebound” effects, when observable, are small and unimportant.

As often before, Mr. Owen also hasn’t done his technological homework. He correctly notes that airplanes have become far more efficient: actually, from 1958 to 2010, improved airplane design and airline logistics slashed the fuel burned per seat-mile by 82 percent. But this dramatic progress is very far from exhausted. Our new business book Reinventing Fire illustrates (at page 57) Boeing, NASA, and MIT airplane designs saving 59–80 percent of the fuel of today’s counterparts. Those new designs still burn kerosene, but the Pentagon is now driving a revolution in advanced biofuels (many needing no cropland), and over the coming decades, economically similar, even safer, and approximately climate-neutral liquid-hydrogen “cryoplanes” (p. 64) can ultimately raise efficiency even more.

To be sure, since fuel is a big cost for airlines, more-efficient airplanes with good returns on marginal cost may indeed make flying even cheaper—even as some jurisdictions, like the EU today, seek to internalize flying’s socialized external costs (a sound economic principle) so that flyers can’t impose their costs on others. Any resulting net drop in airfares couldn’t boost flying five times to offset the five-times fuel saving (let alone more, as Owen sometimes claims). The elasticities don’t work that way, so the great majority of the gross fuel saving will still remain as a net fuel saving. But it’s true that if flying did rise 5 times and fuels didn’t shift, we’d be back where we started.

The effects of flying, though, can differ in other ways than the efficiency of the airplane. When Owen flies to Melbourne, his muddled grasp of energy and economics could confuse people and cause some to reject energy efficiency—the most important single part of the solution to the problems he decries. In contrast, when I fly to Melbourne (or, as I prefer to, send just the electrons and leave the heavy nuclei at home), I reduce carbon and other impacts far more than enough to offset the flight, because I’m delivering not confusion but practical and profitable solutions that give more and better services with less energy, money, and impact.

Related: “As Jet Fuel Prices Soar, a Green Option Nears the Runway”

Related: “First Commercial U.S. Biofuel Flight Takes Off”

Related blogs: “Rebounds Gone Wild” and “Rebounds and Jevons: Nobody Goes Around There Anymore”