REPORT: U.S. Energy Security Linked to Efficiency

Americans spent US$285 billion on transportation fuel in the year 2000 – about as much as on national defense-according to a new report issued today by Rocky Mountain Institute (RMI).

Snomass, Colorado – May 20, 2003 [] The report, “U.S. Energy Security Facts,” makes clear that the U.S. can alleviate the vulnerabilities and costs of its oil supply by using oil in efficient, money-saving ways. “The Iraq war, the economic downturn, and the ongoing Congressional energy policy debate make this a ripe time to refocus attention on reducing America’s energy vulnerability by increasing her energy efficiency,” said the report’s author Amory B. Lovins. “Efficiency doesn’t require sacrifice, it makes money, it makes sense, and it’s the fastest, most powerful way we know to shift to energy sources that can’t be cut off.” The report documents energy’s diverse threats and costs, and highlights the potential for achieving large and rapid gains in U.S. oil efficiency. Almost unnoticed, since 1975 the U.S. has doubled the economic activity wrung from each barrel of oil. Overall energy savings, worth about US$365 billion in 2000 alone, are effectively the nation’s biggest and fastest-growing energy “source,” providing two-fifths of all energy services-equivalent to 1.65 times the total amount of oil use or 12 times the amount imported from the Persian Gulf. Without gains in energy productivity since 1975, energy consumption in the United States would have grown by 253 percent more than it did. Rather than further developing this enormous and largely unexploited “efficiency resource,” federal energy policy continues to focus on subsidizing and expanding the least competitive options-supplying more fossil and nuclear energy. The oil industry has dwindling reserves, falling output, and rising costs (including military), while the efficiency industry has expanding reserves, rising output, and falling costs. The report finds that during 1977-85, GDP rose 27 percent, oil use fell 17 percent, net oil imports fell 42 percent, and imports from the Persian Gulf fell 87 percent. If the country had repeated that 5.2 percent annual gain in oil productivity starting in 1/2000, Persian Gulf imports could have been eliminated by 5/2002. The key to the huge 1977-85 oil savings was Detroit’s 7.6-mpg-better cars. (Transportation uses the lion’s share of oil in this country – 68 percent – while buildings use 6 percent, industrial fuel, 8 percent, and industrial feedstocks such as asphalt and petrochemicals, 17 percent). Two decades ago, vehicles gained 3.25 mpg every 21 months while improving safety, peppiness, and emissions. But efficiency gains were soon followed by a period of stagnation through the 1990s. In 1991, the Gulf War cost the U.S. US$61 billion, of which allies reimbursed US$54 billion. If the nation had invested just the remaining US$7 billion in the cheapest available oil savings, the country could have displaced all of the oil it now imports from the Gulf. The budget for the Iraq war through June 2003 exceeds US$80 billion. Since 1975, oil imports have cost Americans over US$2 trillion.
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