Thursday, February 26, 2009

Laitner and Ehrhardt-Martinez: Information and Communication Technologies: The Power of Productivity

Laitner, John, and Karen Ehrhardt-Martinez. 2008. Information and Communication Technologies: The Power of Productivity. American Council for an Energy-Efficient Economy, February.

ICT helps to promote energy consumption savings. "For every extra kilowatt-hour of electricity that has been demanded by ICT, the US economy increased its overall energy savings by a factor of about 10" (v). There has been a delinking of economic growth from growth in energy consumption, and this report posits that ICT is a major contributor to this delinking. In addition, it indicates that we are probably not using ICT to its fullest potential.

"There is broad agreement that greater levels of productivity can lead to greater economic returns" (1).

"During the current historical period, gains in productivity are most likely to result from the continued development and application of new information and communications technologies" (1).

There is an outline of how ICT contributes to productivity, relying heavily on Jorgenson et al (2005). Then the topic of energy is explored: "...it does appear that ICT investments may actually be 'energy saving' more broadly speaking. That is, the same digital age investments that are driving a more robust economic productivity are also increasing the efficiency in how we use energy more generally" (3)

"As we implied in the previous section, ICT has not only transformed our economy and our lives, they ahve also reinvigorated economic productivity. What is less well-recognized is that ICT systems have revolutionized the relationship between economic production and energy consumption" (4).

"To more fully explore the ICT paradox and to gain a better understanding of the potential net energy benefits provided by ICT, this report explores the following questions: What is the enabling role of ICT investment and how might they be expanded to increase energy productivity beyond current patterns of improvement? How might a productivity-led ICT strategy provide greater energy security while contributing toward climate change mitigation efforts? What do current energy and efficiency trends look like and how do ICT provide a positive complement within the emerging trends? We begin by assessing where ICT fit within the historical and technological context and by discussing our working definition of the term 'energy efficiency" (4).

"Energy efficiency is a process that achieves the same ends with fewer energy inputs. It's about producing, transporting, traveling, lighting, cooking, heating, and communicating in ways that maintain or increase our productivity for every unit of energy consumed. In other words, energy efficiency is about providing the same goods and services using less energy. Energy efficiency and energy conservation are not the same" (6).

"In recent periods, there is no doubt that ICT have played a critical role in reducing energy waste and increasing energy efficiency throughout the economy" (8). Anecdotal evidence is provided.

Huber and Mills wrote in Fortune that PCs use much electricity, and they forecast that trend to continue. However, Koomey concluded that there was only an overall consumption of electricity of about 3% by computers in 2000 as opposed to about 15% by the former authors. The key question that this report attempts to address is not how much energy ICT uses, but what is the net effect of ICT on energy consumption.

There is then much anecdotal evidence that ICT is improving energy efficiency: processers in cars, smart homes, easy business transactions, etc.

The authors conclude with a statistical analysis of the relationship between ICT consumption and energy use, arguing that for every kilowatt-hour of electricity consumed by ICT, 6-14 were saved.