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The consumption trap

Financial Daily
from THE HINDU group of publications
Tuesday, August 07, 2001


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The consumption trap
Kumar Venkat
DESPITE serious energy shortages in the US, the American public has not
appeared willing to sacrifice environmental concerns for increased energy
supplies. Major opinion polls over the last few months have consistently
shown that a large majority support s, in principle, the basic elements of
an alternative energy road map -- such as conservation, utilising
renewable energy sources, increasing energy efficiencies, and curtailing
carbon-dioxide emissions -- which lead to global warming.
Many Americans also oppose the Bush Administration's controversial plan
for oil exploration in the Arctic National Wildlife Refuge, a sensitive
wildlife habitat in Alaska. There is increasing momentum building up
against the Administration's heavy focus on conventional energy production
using fossil fuels. The House of Representatives, clearly sensing where
the public stands on this issue, has just dealt the Bush Administration a
big blow by blocking new oil and gas production in environmentally sensiti
ve locations such as the eastern Gulf of Mexico and the Great Lakes.
While two-thirds of Americans disagree with Mr Bush's energy plan -- and
with his earlier decision to virtually abandon the global warming issue by
withdrawing from the Kyoto Protocol -- the alternative path promises to be
a difficult one. With less than five per cent of the world's population,
the US consumes about 25 per cent of the world's energy. It is also a
major contributor to global warming, accounting for one-quarter of the
global carbon-dioxide emissions.
Energy consumption increased dramatically during the economic growth of
the 1990s and is projected to further increase by 30-40 per cent over the
next 20 years. Long used to the availability of virtually unlimited energy
at low prices (by world standards ), the US is now struggling to match
future energy supplies with fast-growing demand, without damaging the
Americans consume significantly more energy per capita than most
industrialised nations -- twice as much as France or England, and 60 per
cent more than Japan. There is clearly room for large reductions in energy
consumption, but any such change would re quire cutting back on the
American lifestyle. A sustainable energy future is not out of reach, but
the transition is likely to be painful.
Much of the current debate swirls around higher efficiency standards for
power-hungry appliances such as air conditioners. Another major target is
the low fuel efficiency of sports utility vehicles and light trucks, which
now account for almost half of a ll automobile sales. The current
assumption is that new technologies can squeeze more out of existing
energy supplies, so that consumers do not have to squeeze any waste out of
their lives. But it will be years before some of these technologies can go
in to production, and longer still before most of the older appliances and
vehicles are replaced. These long-term energy savings are necessary, but
at best, they would help moderate the growth in demand.
The one issue not being debated is a direct, across-the-board reduction in
energy use. Neither politicians nor environmental groups have been keen to
engage the public in an honest discussion on conservation, for fear that
``pain is bad politics''.
If the US embarked on an immediate conservation effort, we would not have
to wait for energy-saving technologies. We could save what remains of our
wilderness from oil and gas production. We would not have to build
polluting power plants, nor would we ne ed to face the risks of nuclear
energy -- both of which seem inevitable at the moment. We could buy
ourselves enough time to develop safe and sustainable solutions based on
renewable energy sources, an approach that has not received adequate
attention or funding for a long time. And, the reduced carbon-dioxide
emissions would make conservation the right solution for global warming as
To get there, we would actually need to weed out many wasteful or
unnecessary uses of electricity, drive less, buy fewer products, and throw
away fewer things. Energy is used not only to run appliances and cars, but
also to make virtually everything we b uy -- from light bulbs to plastic
bottles to computers. It also takes energy to transport these products to
local stores and homes. Energy use cannot be cut significantly without a
general reduction in non-essential consumption. But such energy conservat
ion would have a major impact on the economy.
Since two-thirds of all economic activity in the US is consumer spending,
any drop in consumption would slow down the economy. A resource-conserving
lifestyle would be in fundamental conflict with the current economic
system, which demands growth from ye ar to year.
The energy crisis in California illustrates this in part. Electricity
consumption has temporarily decreased in the state by 10-12 per cent,
forced largely by skyrocketing prices and threats of blackouts. But
California's economy has already taken a hit, and could shrink next year
by up to 1.1 per cent instead of growing by 1.7 per cent.
The world is caught in a consumption trap. An increasing number of people
are passionate about maintaining a clean and unspoiled environment. Most
people also want the convenience and comfort of many consumer goods, rare
just a decade ago. We want increa sing personal incomes so that we can
afford the latest innovations, and a fast-growing economy that can sustain
the current lifestyles. Economic growth -- as defined now -- depends on
creating new wants and then satisfying them, and uses natural resource s
for energy, materials and waste disposal at every turn.
Can the natural environment support this ever-growing consumption by the
developed countries, increasingly joined now by large populations in
developing countries? Is global warming a signal we should seek for not
only cleaner energy sources but also red uced consumption under a more
benign economic system?
The US, with its high consumption levels, has clearly reached a point
where the battle between economic growth and preservation of the
environment is in full swing. There is, perhaps, both a lesson here and a
challenge for countries such as India and Chi na, which are on the verge
of great economic expansion. How will they supply the energy needed for
their growth? How will they lift the living standards of their vast
populations without damaging irreversibly the ecological systems that
sustain life?
Developing countries must work out development strategies that do not
steer them into the same consumption trap. They must develop not only
innovative technological solutions -- including small-scale renewable
energy systems suited for mass deployment -- but also new economic models
that can be sustained over the long term. The future of the world may
depend on their success.
(The author is a software engineer based in the Silicon Valley, US.)

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