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The Economic Imperative of Energy Efficiency


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Evidence now documents the greater role of energy in maintaining a robust and resilient local economy — especially, the more efficient use of energy. Alternatively, the inefficient use of energy actually erodes the vitality of any regional economy. And the U.S. is not at all energy-efficient. Whether electricity, natural gas, or gasoline, the American economy wastes about 86 percent of all the energy it now consumes. This magnitude of waste imposes a huge array of costs that constrains the overall robustness of any local economic activity.

The questions we ask here: if energy prices prove more volatile, if energy supplies are disrupted, or if energy expenditures continue to rise slowly because of more consumption and greater costs, how might those "stresses" impact local consumers and businesses as well as industrial operations and governmental services? And how might those disruptions, in turn, affect local jobs, economic productivity, and overall economic activity?

The Energy Stress Test™ can provide business and community leaders with new insights and information that suggest ways to minimize future economic stresses – and even estimate quantitatively and qualitatively the net economic development benefits of improving the overall energy productivity within a given economic region. The resulting analysis and report will characterize the financial and economic impacts on the regional economy, and on utilities as well as energy suppliers and their customers. The Energy Stress Test™ can be applied further to other resources such as water, soil, and municipal solid waste. The analytical techniques can also be used to assess the robustness of individual businesses and natural gas and electric utilities.

— Economic and Human Dimensions Research Associates