Jevon’s Paradox

In terms of the changes required to reduce greenhouse gas emissions, people are a big part of the problem.

What if we let people be people, without trying to change them?

I may be stating the obvious, but the challenges of altering human behavior are worth unpacking a bit because of what those challenges mean for enterprises and other organizations seeking to make a positive contribution to the clean energy transition.

Consider, for instance, Jevon’s Paradox.

As far back as 1865, William Stanley Jevons observed and noted in his book “The Coal Question” that efficiency gains in coal production and distribution resulted in an expanded set of use cases.

In other words, when technological progress increases the efficiency with which a resource is used, consumption of that resource tends to go up because of increasing demand – Jevon’s Paradox.

Another, more recent example. Fuel economy standards set by governments contributed to an ongoing increase in fuel efficiency (mpg or km/L depending on where you live) over time for passenger cars, pickup trucks, vans, sport utility vehicles, and crossover vehicles. Over the same period, total gasoline consumption for these vehicles has increased because of the number of vehicles in use and the number of miles traveled per vehicle.

In other words, regulations intended to lessen the impact of personal transportation on the environment are correlated with increased miles driven, likely contributing to greater emissions of carbon into the atmosphere. There are legions of environmentalists who will claim there are extenuating factors, but the correlation between increased fuel economy and miles driven cannot be contested.

An argument could be made that fuel economy standards were entirely misdirected. Rather than regulating fuel economy, why didn’t officials focus directly on the problem – the reduction of emissions. How different would the course of innovation in personal transportation have been if they did?

What does that mean for environmentally minded organizations, including enterprises and government regulators? It means that cause and effect, stimulus and response, action and reaction are far from straightforward calculations when an assumed change in human behavior is part of the equation.

What if… (we like “what if” questions at Tilt Global)… what if we approached the energy transition from a position that didn’t depend on changes in the consumption behavior of individual humans? What if we took human behavior as a constant to be worked around, not a variable to be altered? How would that change the way governments regulate and the way enterprises innovate?

What if we empowered your enterprise or government organization to think this way, to make better and faster decisions that account for the complex realities involved in navigating the transition to clean energy?

Contact us to learn more about better decision making for your team.