Why does energy use continue to increase despite the constant appearance of better, more efficient technology? Given that energy consumption per dollar of GDP is decreasing (energy intensity is increasing), some people might say that energy subsidies are justified, at least in the industrial and commercial sectors. So, why should energy consumption increase in the residential sector? By far the greatest single use of energy in the home (almost half) goes towards heating (only 6% goes towards air conditioning) [DOE]–and let’s face it, the climate ain’t getting colder. If we look at the residential energy use patterns over the years, a surprising trend is visible. The greatest energy-using states go from the North (in the 1970s) to the South and Midwest. Something besides a winter storm is brewing.
Price certainly plays a large role. The states whose per capita energy consumptions were the highest in the last five years of data do have some of the cheapest energy prices in the country (North Dakota, Kentucky, Nebraska, Missouri, Tennessee, Indiana, Oklahoma, and Alabama had the 4th, 5th, 6th, 7th, 9th, 14th, 15th, and 24th cheapest residential electricity prices in 2007) [DOE].
Another factor to consider is the square footage of the residences, which has also been continuously increasing over the last few decades [US Census].
This doesn’t mean that price per square foot is decreasing, however. If we look at the median selling prices of new homes over the same time period (discounted to 2007 dollars), this is also increasing [DOE].
It’s no wonder that the current credit crisis started in the housing market. We’re making bigger and bigger investments on bigger and bigger houses–and then paying energy bills to keep all the extra space running. Per capita income may be increasing with GDP, but not as fast as home price is rising. If we divide median selling prices of new homes by median income, the quotient is increasing over the years.
The question is: why do we need all this extra space when household size is decreasing?









