cantly enhanced of accelerating, in spite of persistent public misgivings, the development of coal and nuclear power, and of investing in the development of major new energy initiatives such as the SPS system. We now know, however, that the 1980s are likely to bring instead still further declines in the growth of American demand for conventional energy supplies. Efforts, such as this one by NASA planner Jesco von Puttkamer (32), that sought to justify the front-end investment costs of the SPS by reference to a desperate energy gap projected into the near future, are simply no longer believable: The problem of satisfying the estimated energy demand of the industrialized world will reach near-critical proportions over the next 25 years. The electrical power capacity of the U.S. alone is expected to triple (from 500 to 1500 gigawatts) before 2000, requiring investments on the order of a trillion dollars. No obvious single source can satisfy this growth in demand . . . By the year 2000, solar energy satellites could supply tens of thousands of megawatts of electricity to our energy-starved cities, meeting perhaps up to 20% of the power requirements of the U.S. at that time. ELECTRICITY DEMAND AND RENEWABLE RESOURCES Virtually all of the major energy studies, conducted under widely disparate auspices over the past few years, have converged in reporting a surprising degree of flexibility in the historical linkage between economic growth and energy consumption. The reports come from such variegated organizations as the Ford Foundation (33), Resources for the Future (34), the Harvard Business School (35), the Union of Concerned Scientists (36), and the National Academy of Science (37). All indicate that energy consumption tends to be a rational response to existing energy prices. In the years between 1951 and 1971, the real price of electricity fell by 43%, that of petroleum by 17% (38). Between 1967 and 1972, energy use increased by 22%, while the GNP rose by only 17%. That pattern was reversed during the next five years, however, in response to the price shocks that followed the Arab oil embargo: from 1973 to 1978, U.S. energy consumption grew by 5%, while the GNP, corrected for inflation, expanded by 12% (39, 40). Recent experience has demonstrated an unexpected degree of elasticity in energy demand. Evidently, rising prices do less to increase supply than to reduce demand, stimulating the development of ways to use less energy more efficiently. Sales of petroleum have been declining steadily since 1978; total U.S. energy consumption from all sources actually dropped by 3.4% in 1980 compared with 1979, while sales of electricity, projected by the utility industry to grow by 5.4% per annum through the 1980s (41), increased by only 1.12% in 1980 (42). The fluid relation between energy use and GNP is reflected in the overall improvements in energy efficiency that have been achieved by American industry since 1973: it now takes 10% less energy input to produce a dollar's worth of output (43). Energy demand is growing more slowly than the economy as a whole, bringing about a major change in the U.S. energy picture: It is plain that what was once considered a utopian vision — the possibility of improving the economy with “zero energy growth” — is becoming accepted among forecasters as a plausible way out of the current energy bind (44). It is important to recognize, however, that there continue to be significant political, institutional and regulatory impediments that prevent full exploitation of the energy-efficiency improvements that are already available through existing technol-
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