Improving energy efficiency The effectiveness of government action

Energy conservation involves the substitution of intelligence, prudence, maintenance, and better equipment for scarce, insecure, and costly energy. These substitutions improve efficiency of energy use and thereby enhance economic productivity. The benefits of conservation are clear, but the proper role for government is hotly debated. Although the normal workings of the market system are doing much to stimulate cost-effective conservation actions, several barriers to conservation still exist. Government programmes are needed to help overcome these barriers. Present US Department of Energy conservation programmes could reduce annual energy use by 2.7 quads in 1985 and by 13 quads in 2000. The present worth of the estimated cumulative oil saving over 20 years is $50 billion, in addition to the savings realized by energy consumers themselves.