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Energy Efficiency and Curtailment: Are They Equal?

Given the war in Ukraine, rising inflation, and ongoing efforts to reduce greenhouse gas emissions, consumers in the United States and abroad continue to be concerned about energy. While some have decided to raise thermostats and reduce trips in their vehicles to save energy, others have invested in more efficient technologies, like better-mileage vehicles and smart appliances. But which strategy yields the greatest return? Is it better to invest in energy efficiency or curtail the use of energy whenever possible? Recent studies suggest that while consumers often adopt a combination of efficiency and curtailment measures, the conservation potential of energy efficiency is actually higher. This means that buying and maintaining a high-efficiency HVAC system or air conditioning unit saves more energy than keeping the thermostat at 70 to 72 degrees in the summer. Similarly, saving money to buy a fuel-efficient vehicle conserves much more energy than changing travel habits or carpooling to work. In the latter example, one study found that carpooling yielded a 4.2% improvement in energy consumption while using a fuel-efficient vehicle (30.7 mpg vs. 20 mpg) yielded a 13.5% improvement. And while improving energy efficiency often costs more than curtailment, energy efficiency measures are typically easier to implement. Individuals are more psychologically motivated to follow through with efficiency compared to curtailment. Research indicates that curtailment measures are difficult to maintain because they require constant attention on the part of the consumer and because they often lead individuals to feel as though they must sacrifice something to be successful. Findings from these studies support the notion that subsidies and rebates available to consumers for more efficient technologies are key to saving energy, reducing costs, and curbing emissions. While curtailment can help some, much greater impacts can be realized by investing in efficiency measures.

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