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How The U.S. Is Breaking The Link Between Energy Use And Economic Growth

By Jeff Spross on January 29, 2014 at 9:54 am

"How The U.S. Is Breaking The Link Between Energy Use And Economic Growth"

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There’s growing evidence the American economy has severed the link between energy use and economic growth, and that energy efficiency efforts are a key part.

While the United States has no uniform national code for how buildings use energy, codes are adopted by state and municipal governments. The most widely used is the International Energy Conservation Code (IECC), which is put together and updated in cycles every few years by a non-profit coalition. The Department of Energy does give input into how the code is updated, and helps coordinate its adoption.

According to the Energy Efficiency Codes Coalition, an advocacy group put together in 2007 to push the IECC in a more ambitious direction, the last two updates improved efficiency in the code by 30 percent:

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The Department of Energy called it “the largest, one-step efficiency increase in the history of the national model energy code.” 

That’s arguably been a critical part of a remarkable trend the Natural Resources Defense Council noted last year. Up until the late 1970s, energy consumption grew in tandem with the economy. But after that, the two trends split, with economic growth continuing to go up and energy use increasing at a far lower rate.

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At this point, America’s energy consumption is well below where it was predicted to be in the 1970s. The Coalition quoted Duke Energy CEO Lynn Good that “improvements in energy efficiency for buildings and appliances appear to have broken the traditional connection between electricity demand and economic growth.”

What this is, in effect, is productivity — doing more with less — applied to how we use energy. And it’s really the holy grail of all economic activity. Greater productivity here means lower energy bills for consumers, less dependence on foreign oil, less extraction of natural resources, and, of course, lower carbon emissions.

And as Brad Plumer recently noted at the Washington Post, there’s also evidence the same thing is happening at the global level — though economists are split on what the data means, and some argue it’s more a change in the nature of the energy being used than an absolute decrease in how much energy is used per unit of global wealth created.

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