When you step back and look at the big picture of our national energy consumption, it's a gluttonous one.
Last month, I offered the opinion that the price we pay for energy in the U.S., especially for gasoline, has not reflected its true cost to us as a nation in terms of national security and environmental impact. In fact, we seldom stand back and look at the big picture of our national energy consumption. But if you do, it's a gluttonous one.
We have talked a good game about energy conservation ever since the early 1970s. Some efforts, such as government efficiency standards for home appliances, have curtailed the most offensive energy wasters. But as you can see from the charts on this page, our energy consumption per person is almost the same today as it was 35 years ago.
The population has grown since then, so our aggregate consumption is up quite a bit. For those concerned about global warming, so is our carbon dioxide production.
Further, when you look at the price we've paid for gasoline over that same period, you see that the real, inflation-adjusted price paid by consumers has been in decline for most of the past 25 years. Even at $2 a gallon, it sells for about the same price in real terms as it did in 1976. It's no wonder we use more of it.
Why editorialize about this in the pages of FM? Because I believe we are entering an era when energy will again become a subject of great national concern and during which its real price will once again begin to rise.
While energy costs will never be as significant as food and labor costs to the average operator, better energy management will become important to many of our institutions. The move to "green" buildings you can read about elsewhere in this issue will become more widespread. And in a time when world demand for oil exceeds supply, gasoline will become more expensive.-That will have real implicationsfor every organization whose employees commute to work in cars or go off site for lunch.
Oil is a dear resource and should be treated that way. And any politician who suggests we can "produce" our way back to a time of cheap energy profligacy is deeply misguided.
Let the true costs of energy be reflected in its price; implement better energy management to cope with that, and let the market work. That is a much more realistic, and more effective, long term energy strategy for the nation.
*Source: Energy Information Administration, Monthly Energy Review; American institute for Economic research (Great Barrington, MA)