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In: Economics

What has been the common theme for the last thirty years of our domestic energy usable?

What has been the common theme for the last thirty years of our domestic energy usable?

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Expert Solution

Globally, between 1973 and 2007, gross energy consumption rose from 4,675 to 8,286 million tonnes of oil equivalent. The United States is now the biggest energy producer in the world, accounting for 20 % of the world 's main energy consumption. China, the second biggest customer, reportedly accounts for nearly 15 percent. Since 1970, energy use has risen by around 1 percent a year in the United States, but there is no longer a clear correlation between energy usage and economic development. For example, between 1973 and 2008, the U.S. energy intensity, calculated as the amount of energy consumed per gross domestic product ( GDP) dollar, reduced by half, or 2.1 percent per year. Despite this trend, per unit of GDP and per capita, the United States also has greater energy consumption than nearly all other developing nations.

The energy intensity of a country represents population and demographic and environmental trends, as well as the efficacy of the supply of goods and services and the desire of customers for these goods and services. A comparison between the energy intensity of the United States and that of other countries reveals that about half of the difference is due to energy quality variations. Structural influences such as the combination of industries ( e.g., heavy industry versus light manufacturing) and living, working, and travel habits, both of which may have evolved over decades or even centuries, are also expressed in the discrepancies.

It is important to understand trade patterns when accounting for the energy or environmental effects of changes in the balance of goods generated and consumed in the economy. For example, if the decrease in domestic steel output is offset by an rise in imports of steel, domestic GHG emissions may tend to decrease, but there may not be a net global decrease in GHG emissions (and emissions may also rise, provided the likelihood of discrepancies in the emissions related to production and the energy spent for shipping the imported product).


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