Even though many people believe that Americans have done almost nothing in response to higher oil prices and shortages, the United States is well on its way to using energy more efficiently, a new study released today by Resources for the Future concludes.
Resources for the Future is a nonprofit research organization specializing in questions involving natural resources.
Between now and the year 2,000, energy use in the U.S. will grow by only 1.8 percent a year if the economy expands at a 3.2 percent rate, the study forecasts.
Prior to 1973, energy use and the nation's output of goods and services were expanding together. Since then, the large price increases for energy have caused business and consumers to begin to conserve. The study predicts increased conservation.
The projection that total energy usage at the turn of the century will be about 115 quadrillion British thermal units is very close to a recent projection made by the Department of Energy for the 1990s.
A quadrillion BTUs - or quads, as they are known - is roughly the equivalent of the energy content released by using 500,000 barrels of oil a day for one year.
The study, which is being published as a book, "Energy in America's Fufture," thus concludes that total energy consumption will rise by less than 50 percent over the next 21 years.
Nevertheless, the book stresses that less and less naturally occurring oil and gas will be available, and that the country will be increasingly dependent on using more coal and uranium in one way or another.
"Even if imports of oil were maintained at the 1976 level of about 40 percent (of total oil use), and oil and gas consumption grew at an annual rate of 2 percent, conventional domestic oil and natural gas resources would last not much beyond the year 2000," says the book.
The four authors of the book - Joel Darmstadter, Harry Perry, William Ramsay and Milton Russell - believe that fuels synthesized from coal will be fully competitive with oil and gas, with prices no more than double their 1978 level in real terms.
Currently that would be close to $30 a barrel. Some oil is being sold for more than $20 a barrel.
The study's examination of the commercial potential of solar energy is less sanguine. The minimum price for an equivalent amount of energy from solar technologies is about $35, substantially above the likely cost of synthetic fuels such as liquids from coal or gas made from coal.
As the U.S. moves in these directions, it will import less and less of its energy supplies and begin to approach that goal announced a few years ago: virtual energy independence.
The authors see the nation's real energy problem as being more political and instijtutional than economic or technical. But resolving some of these conflicts is essential, say the authors.
"A consensus on goals is essential, not only to provide a starting point for launching timely initiatives to meet long-term needs, but also to aid in coping with short-run problems," they argue.
As economists, they enter a special plea on energy prices: "Effective energy policy is best served by a pricing system that tells each consumer accurately and directly what it costs our economy to use more energy, as well as each producer or importer how much those additional supplies will contribute. . . .
"While the price of imported oil does not reflect a competitive market price, it represents what must be surrendered in economic value for each imported barrel we use."