Energy, Efficiency Gains and Economic Development: When Will Global Energy Demand Saturate?

Energy Intensity of Final Consumption: the Richer, the Poorer the Efficiency

“…7). Economic growth is sometimes considered useful to reduce energy use as it could drive technological progress, thereby reducing overall energy use 15 . However, the first consequence of economic growth is to produce more goods and services.…”

“…Many focus on the causality between both factors 13 while some advocate that economic value will be decoupled from energy consumption. An edifying example is a study assuming the existence of a Kuznet's curve between energy and GDP-an inverted U-shaped curve implying that total energy use tends to zero in an infinite economy-and predicting a peak of energy demand at US$107,000 per capita 15 . Yet, to analyse energy intensities, it is essential to see energy neither as a cause or consequence of GDP, nor as an indicator independent of GDP, but as a provider of energy services 16 which are subsequently estimated through the GDP prism.…”

Commodity Markets: Evolution, Challenges, and Policies

“…3 There is even some evidence of declining per capita consumption at higher levels of income for some commodities. The precise form of the 2 The nonlinear nature of the commodity consumption-income relationship throughout the development process has led to a strand of literature that comes under various names: the material or environmental Kuznets curve, S-shaped curve, inverted U-shaped curve, dematerialization hypothesis, the intensity of material use hypothesis, and plateauing hypothesis (Bogmans et al 2020;Clark 1940;Cleveland and Ruth 1998;Herman, Ardekani, and Ausubel 1990;Kuznets 1971;Radetzki et al 2008;Tilton 1990).…”

“…Demand for final products has also been studied extensively-see Kamerschen and Porter (2004) for electricity; Dahl (2012), Drollas (1984), and Gately and Streifel (1997) for gasoline and diesel. At the aggregate level, several studies look at the demand for energy (Bogmans et al 2020;Burke and Csereklyei 2016;Csereklyei and Stern 2015;Dahl and Roman 2004;Jakob, Haller, and Marschinski 2012), and Baffes, Kabundi, and Nagle (2022) cover both individual and group aggregates for energy and metals.…”

“…Technological developments can also introduce significant efficiency gains on both the consumption and the production side, which, in turn, can encourage large-scale commodity substitution Tilton and Guzmán 2016). For example, improvements in global energy efficiency, such as increased thermal efficiency of fossil fuel power plants and improved fuel economy of internal combustion engines, have been estimated to have lowered global energy consumption by about 1.2 percent per year between 1971 and 2017 (Bogmans et al 2020). Similarly, innovations in production processes can sharply reduce resource use and production costs in manufacturing processes (for example, 3D printing; Campbell et al 2011).…”