Cheap electricity and gasoline fueled Tennessee’s prosperity over the last several decades. But Tennessee now ranks second in the nation in per-person residential electricity consumption, much of which is generated from coal, the most carbon-intensive fossil fuel, and Tennessee drivers rank among the highest in the number of vehicle miles traveled per person.
How can Tennessee succeed in a new energy era in which market pressures and carbon emissions limits will generate high energy prices for the foreseeable future? The first step is to recognize the challenge while there is still time to adapt. The industrial heart of the nation did not become the Rust Belt overnight. It simply continued with business-as-usual while major changes occurred in the global economy, only to find that its competitive advantage had eroded.
The formation of the Governor’s Energy Policy Task Force suggests that Tennessee can act with foresight and avoid the Rust Belt’s fate. The Task Force is examining how the state can prosper in this new energy era and how the state government can lead by example.
Meeting the challenge will require reducing demand through conservation and efficiency and increasing the supply of clean, secure energy.
Although it is tempting to look only at energy supply, if demand grows at historic rates, the game is up. We will not be able to avoid substantial risks to the economy and the environment. Dramatic advances in technology will occur, but they will take decades to develop and adopt. In contrast, reducing demand now through efficiency and conservation can cut energy costs and carbon emissions while providing jobs and a window of time to develop clean energy sources.
Research and experience suggest that large energy savings can be achieved today at remarkably low cost. Price increases alone will stimulate changes, but in some cases infrastructure changes also will be necessary. Good information is also important.
A National Research Council report concludes that we suffer from "energy invisibility" — we cannot identify our largest energy uses, so we don’t know where to save money and energy. The report notes that expecting households to reduce energy bills is like expecting shoppers to reduce grocery bills in a store where products have no price tags and shoppers only get a final bill at checkout.
Providing prompt, accurate information that attracts attention and sticks in the memory can have tremendous effects.
Studies show that simply providing real-time feedback about home electricity use can reduce electricity bills by 10 percent or more.
A program to train municipal employees to drive efficiently is saving one city roughly $300,000 per year. Our research at Vanderbilt has demonstrated that large savings can arise just from inducing drivers to reduce unnecessary idling to 30 seconds or less.
By identifying ways to reduce energy demand, the Task Force can lay the foundation for a prosperous future, generate new jobs, respond to carbon constraints, and demonstrate that the New South of today will not be the Rust Belt of 2020.
Michael P. Vandenbergh is a professor of law and co-director, Regulatory Program, at the Vanderbilt University Law School. He is on the Governor’s Task Force on Energy Policy.