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International audience; The majority of global energy scenarios anticipate a structural break in the relationship between energy consumption and gross domestic product (GDP), with several scenarios projecting absolute decoupling, where energy use falls while GDP continues to grow. However, there are few precedents for absolute decoupling, and current global trends are in the opposite direction. This paper explores one possible explanation for the historical close relationship between energy consumption and GDP, namely that the economy-wide rebound effects from improved energy efficiency are larger than is commonly assumed. We review the evidence on the size of economy-wide rebound effects and explore whether and how such effects are taken into account within the models used to produce global energy scenarios. We find the evidence base to be growing in size and quality, but remarkably diverse in terms of the methodologies employed, assumptions used, and rebound mechanisms included. Despite this diversity, the results are broadly consistent and suggest that economy-wide rebound effects may erode more than half of the expected energy savings from improved energy efficiency. We also find that many of the mechanisms driving rebound effects are overlooked by integrated assessment and global energy models. We therefore conclude that global energy scenarios may underestimate the future rate of growth of global energy demand.

As current action remains insufficient to meet the goals of the Paris agreement let alone to stabilize the climate, there is increasing hope that solutions related to demand, services and social aspects of climate change mitigation can close the gap. However, given these topics are not investigated by a single epistemic community, the literature base underpinning the associated research continues to be undefined. Here, we aim to delineate a plausible body of literature capturing a comprehensive spectrum of demand, services and social aspects of climate change mitigation. As method we use a novel double-stacked expert—machine learning research architecture and expert evaluation to develop a typology and map key messages relevant for climate change mitigation within this body of literature. First, relying on the official key words provided to the Intergovernmental Panel on Climate Change by governments (across 17 queries), and on specific investigations of domain experts (27 queries), we identify 121 165 non-unique and 99 065 unique academic publications covering issues relevant for demand-side mitigation. Second, we identify a literature typology with four key clusters: policy, housing, mobility, and food/consumption. Third, we systematically extract key content-based insights finding that the housing literature emphasizes social and collective action, whereas the food/consumption literatures highlight behavioral change, but insights also demonstrate the dynamic relationship between behavioral change and social norms. All clusters point to the possibility of improved public health as a result of demand-side solutions. The centrality of the policy cluster suggests that political actions are what bring the different specific approaches together. Fourth, by mapping the underlying epistemic communities we find that researchers are already highly interconnected, glued together by common interests in sustainability and energy demand. We conclude by outlining avenues for interdisciplinary collaboration, synthetic analysis, community building, and by suggesting next steps for evaluating this body of literature.

Annual review of environment and resources 46(1), 135-165 (2021). doi:10.1146/annurev-environ-012320-084937, Published by Annual Reviews Inc., Palo Alto, Calif.

A series of weaknesses in creativity, research design, and quality of writing continue to handicap energy social science. Many studies ask uninteresting research questions, make only marginal contributions, and lack innovative methods or application to theory. Many studies also have no explicit research design, lack rigor, or suffer from mangled structure and poor quality of writing. To help remedy these shortcomings, this Review offers suggestions for how to construct research questions; thoughtfully engage with concepts; state objectives; and appropriately select research methods. Then, the Review offers suggestions for enhancing theoretical, methodological, and empirical novelty. In terms of rigor, codes of practice are presented across seven method categories: experiments, literature reviews, data collection, data analysis, quantitative energy modeling, qualitative analysis, and case studies. We also recommend that researchers beware of hierarchies of evidence utilized in some disciplines, and that researchers place more emphasis on balance and appropriateness in research design. In terms of style, we offer tips regarding macro and microstructure and analysis, as well as coherent writing. Our hope is that this Review will inspire more interesting, robust, multi-method, comparative, interdisciplinary and impactful research that will accelerate the contribution that energy social science can make to both theory and practice.

Construction must play a major role in meeting climate change targets, but this will require major changes in industry practice. The sector will need to adopt innovative low-carbon technologies, integrate these within novel building designs and ensure these designs are constructed, implemented and optimised successfully. A likely precondition for this is greater levels of integration within the construction supply chain. While there is evidence that supply chain integration (SCI) can improve project performance and enable innovation, the literature rarely differentiates between different types of innovation and has paid little attention to low-carbon innovation. This paper synthesises insights from three different bodies of literature – construction innovation, low carbon buildings and SCI – to create a typology of low-carbon innovations in non-domestic buildings and to identify conditions and strategies for their successful implementation. It proposes that low-carbon innovations are ‘building-enhancing’ ‘integral’ and/or ‘user-dependent’ and their effective implementation requires collaboration, championing and user-involvement. The paper uses two case studies to illustrate the diversity of mechanisms through which these conditions can be realised. It concludes with some reflections on the methodological challenges of studying this topic, together with the wider implications of the proposed framework for industrial practice and public policy.

This article presents a critical assessment of research over the last 40 years that may be brought under the umbrella of “energy efficiency,” spanning different aggregations and domains – from individual producing and consuming agents to economy-wide effects, the role of innovation, and the influence of policy. After 40 years of research, energy efficiency initiatives are generally perceived as being highly effective. Innovation has contributed to lowering energy technology costs and increasing energy productivity. Energy efficiency programs in many cases have reduced energy use per economic output and have been associated with net improvements in either welfare or emission reductions or both. Rebound effects at the macro level still warrant careful policy attention as they may be non-trivial. Complexity of energy efficiency dynamics calls for further methodological and empirical advances, multidisciplinary approaches, and granular data at the service level for research in this field to be of greatest societal benefit.

Information and communication technologies (ICTs) increasingly enable employees to work from home and other locations (‘teleworking’). This study explores the extent to which teleworking reduces the need to travel to work and the consequent impacts on economy-wide energy consumption. The paper provides a systematic review of the current state of knowledge of the energy impacts of teleworking. This includes the energy savings from reduced commuter travel and the indirect impacts on energy consumption associated with changes in non-work travel and home energy consumption. The aim is to identify the conditions under which teleworking leads to a net reduction in economy-wide energy consumption, and the circumstances where benefits may be outweighed by unintended impacts. The paper synthesises the results of 39 empirical studies, identified through a comprehensive search of 9000 published articles. Twenty six of the 39 studies suggest that teleworking reduces energy use, and only eight studies suggest that teleworking increases, or has a neutral impact on energy use. However, differences in the methodology, scope and assumptions of the different studies make it difficult to estimate ‘average’ energy savings. The main source of savings is the reduced distance travelled for commuting, potentially with an additional contribution from lower office energy consumption. However, the more rigorous studies that include a wider range of impacts (e.g. non-work travel or home energy use) generally find smaller savings. Despite the generally positive verdict on teleworking as an energy-saving practice, there are numerous uncertainties and ambiguities about its actual or potential benefits. These relate to the extent to which teleworking may lead to unpredictable increases in non-work travel and home energy use that may outweigh the gains from reduced work travel. The available evidence suggests that economy-wide energy savings are typically modest, and in many circumstances could be negative or non-existent.

From a sociotechnical perspective, improving energy efficiency and reducing energy demand are understood as social processes with complex interactions between multiple actors (firms, researchers, policymakers, consumers) who develop strategies, make investments, learn, open up new markets and develop new routines. A sociotechnical perspective views energy services as being provided through large-scale, capital-intensive and long-lived infrastructures that co-evolve with technologies, institutions, skills, knowledge and behaviours to create broader ‘sociotechnical systems’. This chapter develops a rationale for the sociotechnical approach, describes its general characteristics and identifies some core research debates. It elaborates upon three research themes – emergence, diffusion and impact – and identifies key issues and debates within each.

Progress on improving energy efficiency of UK homes has stalled in recent years and the question arises how much more potential for further energy savings exist across the housing stock. Whilst there are some high-level estimates of the potential for buildings energy efficiency in the UK, a more granular assessment is needed to understand exactly where this potential lies and what form it takes. Our analysis fills this gap. It is based on the best available evidence on the remaining potential for energy efficiency improvements within UK residential buildings. Using UK government criteria for investment appraisal, we demonstrate that there is a significant resource of untapped energy-saving opportunities in UK homes. Specifically, our estimates suggest that: one quarter of the energy currently used in UK households could be cost effectively saved by 2035; and this could increase to one half if allowance is made for falling technology costs and the wider benefits of energy efficiency improvements. However, these estimates are sensitive to the assumptions made about capital, energy and carbon costs, and capturing this potential will require both significant policy change and large-scale investment.

Effective mitigation of climate change will require far-reaching transformations of electricity, heat, agricultural, transport and other systems. The energy studies and modelling research that so often dominates academic and policy debates provide valuable insights into these transitions, but remain constrained by their focus on rational decision-making and their neglect of non-linear dynamics and broader social processes. This review paper describes insights from a complementary socio-technical approach that addresses the interdependent social, political, cultural, and technical processes of transitions. Focusing on the ‘Multi-Level Perspective’ (MLP), the paper conceptualizes transitions as arising from the alignment of processes within and between three analytical levels: niche-innovations, socio-technical regimes and the socio-technical landscape. This analytical framework is illustrated with a case study of the German electricity transition and used to appraise low-carbon transitions in several other sectors. We end by articulating four lessons for managing low-carbon transitions.

Rapid and deep reductions in greenhouse gas emission are needed to avoid dangerous climate change. This will necessitate low-carbon transitions across electricity, transport, heat, industrial, forestry, and agricultural systems. But despite recent rapid growth in renewable electricity generation, the rate of progress toward this wider goal of deep decarbonization remains slow. Moreover, many policy-oriented energy and climate researchers and models remain wedded to disciplinary approaches that focus on a single piece of the low-carbon transition puzzle, yet avoid many crucial real-world elements for accelerated transitions ( 1 ). We present a “sociotechnical” framework to address the multidimensionality of the deep decarbonization challenge and show how coevolutionary interactions between technologies and societal groups can accelerate low-carbon transitions.

This paper investigates the relationships between energy efficiency improvements by producers, the ease of substitution between energy and other inputs and the size of the resulting “rebound effects”. Fundamentally, easier substitution leads to larger rebounds. Focusing upon conceptual and methodological issues, the paper highlights the challenges of estimating and modeling rebound effects with the help of production and cost functions and questions the robustness of the evidence base in this area. It argues that the multiple definitions of “elasticities of substitution” are a source of confusion, the most commonly estimated elasticity is of little practical value, the empirical literature is contradictory, prone to bias and difficult to use and there are only tenuous links between this literature and the assumptions used within energy-economic models. While “energy-augmenting technical change” provides the natural choice of independent variable for an estimate of rebound effects, most empirical studies do not estimate this form of technical change, many modelling studies do not simulate it and others simulate it in such a way as to underestimate rebound effects. As a result, the paper argues that current econometric and modelling studies do not provide reliable guidance on the magnitude of rebound effects in different industrial sectors.

Business model innovation is increasingly necessary for the transition to a sustainable energy system. In this paper we outline how whole-house energy ‘retrofits’ are likely to require business model innovation to gain widespread adoption. Through semi-structured interviews and document analysis, we undertake a case study of the ‘Energiesprong’ retrofit business model and contrast this with the existing ‘atomised’ market model. We highlight the central role of an innovation intermediary - the Energiesprong ‘market development team’- in this business model innovation and further how Dutch policymakers sought to promote it through the creation of this intermediary. In doing so we develop a novel framework, combining the components of business models with the functions of intermediaries. We suggest that for radical energy business model innovations to be adopted, intermediaries may need to facilitate, configure and broker system innovation in multiple system elements. Finally, the paper suggests this case and framework could provide lessons for how intermediaries and in turn policymakers might foster energy business model innovation in other sectors.

This paper examines whether the core assumptions underlying the so-called multilevel perspective on sociotechnical transitions (MLP) stand up to scrutiny. The paper clarifies the explicit and implicit assumptions within the MLP about the nature of reality (ontology), the status of claims about that reality (epistemology), and the appropriate choice of research methods, and assesses the consistency of these with the philosophical tradition of critical realism. The paper highlights a number of weaknesses of the MLP, including: the ambiguous distinction between systems and regimes; the problematic conception of social structure; the use of theory as a heuristic device rather than causal explanation; the ambition to develop an extremely versatile framework rather than testing competing explanations; the tendency to incorporate an increasing number of theoretical ideas, while at the same time paying insufficient attention to the necessity or contingency of particular mechanisms; the reliance upon single, historical case studies with little use of comparative methods; and the rejection of potentially useful methodologies such as agent-based modelling. However, the paper concludes that there is sufficient ambiguity and flexibility in the MLP to accommodate changes to the underpinning assumptions as well as the use of a broader range of research methods.

An upstream trading scheme is described that could operate alongside the EU Emissions Trading Scheme (EU ETS). In this proposed scheme, fossil fuel producers (or suppliers) surrender allowances for the carbon contained in their fuel sales. Since the administrative costs are relatively low, such a scheme could provide a simpler, cheaper and more practical alternative to personal carbon trading, while at the same time delivering comparable economic and environmental benefits. The incentive effect for downstream consumers would be similar to a carbon tax. However, instead of a fixed and visible tax rate, the carbon price would be variable and largely hidden within the price of fuel. Consideration is given to the distributional impacts of the scheme and the potential benefits of linking to the EU ETS - including improved liquidity, reduced price volatility and reduced scope for exercising market power. It is argued that an upstream scheme is likely to have greater political acceptability, while at the same time delivering comparable performance in terms of economic efficiency, environmental effectiveness and social equity.

The concept of Evidence Based Policy and Practice (EBPP) has gained increasing prominence in the UK over the last ten years and now plays a dominant role in a number of policy areas, including healthcare, education, social work, criminal justice and urban regeneration. But despite this substantial, influential and growing activity, the concept remains largely unknown to policymakers and researchers within the energy field. This paper proposes a definition of EBPP, identifies its key features and examines the potential role of systematic reviews of evidence in a particular area of policy. It summarises the methods through which systematic reviews are achieved; discusses their advantages and limitations; identifies the particular challenges they face in the energy policy area; and assesses whether and to what extent they can usefully be applied to contemporary energy policy questions. The concept is illustrated with reference to a proposed review of evidence for a 'rebound effect' from improved energy efficiency. The paper concludes that systematic reviews may only be appropriate for a subset of energy policy questions and that research-funding priorities may need to change if they use is to become more widespread.

Energy service contracting can provide a cost-effective route to overcoming barriers to energy efficiency. Energy service contracts allow the client to reduce operating costs, transfer risk and concentrate attention on core activities. However, the energy services model may only be appropriate for a subset of energy services and energy using organisations. A challenge for both business strategy and public policy is to identify those situations in which energy service contracting is most likely to be appropriate and the conditions under which it is most likely to succeed. Energy service contracting is a form of outsourcing. It will only be chosen where the expected reduction in the production cost of supplying energy services can more than offset the transaction cost of negotiating and managing the relationship with the energy service provider. Production costs will be determined by a combination of the physical characteristics of the energy system and the technical efficiency of the relevant organisational arrangements, including economies of scale and specialisation. Transaction costs, in turn, will be determined by the complexity of the energy service, the 'specificity' of the investments made by the contractor, the competitiveness of the energy services market and the relevant legal, financial and regulatory rules. This paper develops these ideas into a general framework that may be used to assess the feasibility of energy service contracting in different circumstances. The framework leads to a number of hypotheses that are suitable for empirical test.

The Kyoto Protocol is stimulating the development of emissions-trading schemes at the national and international levels. These are being introduced alongside existing policy instruments such as carbon taxes and negotiated agreements, leading to complex problems of policy interaction. But the topic of policy interaction remains under-researched. This paper aims to improve understanding of such interactions by examining the conditions under which a cap-and-trade scheme for carbon-dioxide emissions may usefully coexist with carbon/energy taxes, support mechanisms for renewable electricity, and policies to promote energy efficiency. The paper argues that each of these instrument combinations may be acceptable, provided they contribute to either improving the static or dynamic efficiency of the trading scheme, or delivering other valued policy objectives. But, since the coexisting instruments may raise overall abatement costs while contributing nothing further to emission reductions, the objectives and trade-offs within the policy mix must be explicit.

The recent agreement by European environment ministers on the ground rules for an EU Emissions Trading Scheme (EU ETS) represents a landmark in the evolution of EU climate policy. But this scheme will be introduced into a crowded ‘policy space’ within each Member State in which complex interactions between the EU ETS and existing instruments appear unavoidable. This paper explores one aspect of the problems created by the EU ETS for the UK – namely the potential interactions with the UK Renewables Obligation and the UK Energy Efficiency Commitment. Both these instruments have objectives which go beyond the least-cost abatement of carbon emissions and both utilise trading arrangements in which the trading commodity is denominated in MWh rather than tonnes of carbon. The paper explores the potential interactions between the EU ETS and the UK instruments by comparing in turn their scope, timing, objectives and operation. The coexistence of the EU ETS with the RO and EEC is shown to raise three important issues, namely target setting and double counting, double regulation of electricity and the fungibility of trading commodities. The paper concludes that the coexistence of the RO and EEC with the EU ETS is both possible and justifiable, but more attention should be paid to the non-CO2 objectives of each instrument.

This paper explores the barriers to energy efficiency in the construction of non-domestic buildings in the UK. The source of the barriers is argued to lie in the organisation of the construction industry, including the linear design process, the reliance on cost-based competitive tendering and the incentives placed upon different actors. The consequences include oversizing of equipment, reduced quality, neglect of whole life costs and lack of integrated design. Each of these problems can usefully be interpreted using concepts from the new institutional economics. While the barriers are well known to construction industry specialists, they are relatively neglected in the academic literature on energy policy. Furthermore, conventional policy measures such as building regulations leave these barriers largely untouched. The UK construction industry is currently undergoing a series of reforms which aim to change the relationship between different actors and to achieve improvements in product quality and productivity. While these reforms have the potential to address many of the barriers, the reform agenda makes practically no reference to sustainability. This paper argues that climate policy objectives must be integrated into the reform agenda if the UK is to begin the transition to a low carbon built environment.

The paper examines how the concept of ‘excessive costs’ has been interpreted in the implementation of industrial pollution control in the UK. Since 1984, industrial air pollution regulation in the EU has been guided by the framework concept of Best Available Technology Not Entailing Excessive Costs (BATNEEC). With the introduction of the Integrated Pollution Prevention and Control (IPPC) Directive in 1996, this has been replaced by the concept of Best Available Techniques (BAT). Despite the absence of the NEEC qualification, IPPC BAT includes excessive costs in its definition of ‘available’. Both concepts require interpretation and both devolve potentially controversial decisions to the level of the individual site regulator. A central issue in interpreting ‘excessive costs’ is the relative importance of environmental cost–benefit analysis versus the ability of a sector to ‘afford’ environmental improvements. Also important is how such concepts can be operationalized by regulators who lack resources and depend upon industry for information. The paper provides a historical account of how these issues have been dealt with in the UK and argues that the key difficulties are far from being resolved. The paper concludes by assessing the implications for the future implementation of IPPC.

Improved energy efficiency and reduced energy demand are widely considered as the most promising, fastest, cheapest and safest means to mitigate climate change. But at the global level, the correlation between increased wealth and increased energy consumption is very strong and the impact of policies to reduce energy demand is both limited and contested. Different academic disciplines approach energy demand reduction in different ways: emphasising some mechanisms and neglecting others, being more or less optimistic about the potential for reducing energy demand and providing insights that are more or less useful for policymakers. This article provides an overview of the main issues and challenges associated with energy demand reduction, summarises how this challenge is ‘framed’ by key academic disciplines, indicates how these can provide complementary insights for policymakers and argues that a ‘sociotechnical’ perspective can provide a deeper understanding of the nature of this challenge and the processes through which it can be achieved. The article integrates ideas from the natural sciences, economics, psychology, innovation studies and sociology but does not give equal weight to each. It argues that reducing energy demand will prove more difficult than is commonly assumed and current approaches will be insufficient to deliver the transformation required.

Abundant supplies of oil form the foundation of modern industrial economies, but the capacity to maintain and grow global supply is attracting increasing concern. Some commentators forecast a peak in the near future and a subsequent terminal decline in global oil production, while others highlight the recent growth in ‘tight oil’ production and the scope for developing unconventional resources. There are disagreements over the size, cost and recoverability of different resources, the technical and economic potential of different technologies, the contribution of different factors to market trends and the economic implications of reduced supply. Few debates are more important, more contentious, more wide-ranging or more confused. This paper summarizes the main concepts, terms, issues and evidence that are necessary to understand the ‘peak oil’ debate. These include: the origin, nature and classification of oil resources; the trends in oil production and discoveries; the typical production profiles of oil fields, basins and producing regions; the mechanisms underlying those profiles; the extent of depletion of conventional oil; the risk of an approaching peak in global production; and the potential of various mitigation options. The aim is to introduce the subject to non-specialist readers and provide a basis for the subsequent papers in this Theme Issue.

Interpreting reserves: moving from reserves to URR. Given the conservative nature of reserve estimates, the resulting reserve growth over time, and other associated issues, the ultimately recoverable resource (URR) is a more useful resource classification when assessing future petroleum resource availability. This abstract describes some of the findings of a systematic review of the evidence surrounding resource and reserve estimates for both conventional oil and unconventional gas. This review includes discussion of the methodological approaches that can be used, the difficulties associated with these methodologies and the particular issues associated with estimating unconventional resources. It finds that the most robust estimates are likely to arise from a combination of methodological approaches.

This paper advances five linked and controversial propositions that have both deep historical roots and urgent contemporary relevance. These are: (a) the rebound effects from energy efficiency improvements are significant and limit the potential for decoupling energy consumption from economic growth; (b) the contribution of energy to productivity improvements and economic growth has been greatly underestimated; (c) the pursuit of improved efficiency needs to be complemented by an ethic of sufficiency; (d) sustainability is incompatible with continued economic growth in rich countries; and (e) a zero-growth economy is incompatible with a fractional reserve banking system. These propositions run counter to conventional wisdom and each highlights either a "blind spot" or "taboo subject" that deserves closer scrutiny. While accepting one proposition reinforces the case for accepting the next, the former is neither necessary nor sufficient for the latter.

Despite low real oil prices, interest in car fuel efficiency is undergoing a revival in recognition of its role in determining passenger transport CO 2 emissions. This paper analyses some recent UK trends and attempts to disaggregate the changes between technical improvements, and shifts in model availability and consumer purchase patterns. The importance of car engine size is identified, together with the role played by recent emission regulations. The slowdown in the rate of improvement in fuel efficiency over the past decade is highlighted.

Over 20 years ago UN Commission on Environment and Development called on governments around the world to make sustainable development their first priority. The ‘Brundtland Report’ provided a definition still regularly quoted in policy documents committing governments to the aim. Sustainable development is: [D]evelopment that meets the needs of the present without compromising the ability of future generations to meet their own needs. It contains within it two concepts: the concept of ‘needs’, in particular the essential needs of the world’s poor, to which overriding priority should be given; and the idea of limitations imposed by the state of technology and social organisation on the environment’s ability to meet present and future needs. (WCED, 1987: 43) The opening sentence above has become very familiar, but the two clarifying points that follow are rarely included. Sustainable development is now interpreted in diverse ways in various national and international contexts, often such that the detail presents little challenge to the status quo. For example, in the UK it has been interpreted as a domestic ‘quality of life’ agenda, or as a matter of ‘balancing’ economic, social and environmental protection goals in policymaking.

Direct rebound effects relate to individual energy services, such as heating, lighting and refrigeration and are confined to the energy required to provide that service. Since improved energy efficiency will reduce the marginal cost of supplying the relevant service it could lead to an increase in the consumption of that service. For example, consumers may choose to drive further and/or more often following the purchase of a fuel-efficient car because the operating cost per kilometre has fallen. Similarly, consumers may choose to heat their homes for longer periods and/or to a higher temperature following the installation of loft insulation, because the operating cost per square metre has fallen. The extent to which this occurs may be expected to vary widely from one energy service to another, from one circumstance to another and from one time period to another. But any increase in energy service consumption will reduce the ‘energy savings’ achieved by the energy-efficiency improvement. In some circumstances it could offset those savings altogether (backfire).

Avoiding dangerous climate change is the defining challenge for humanity in the twenty-first century. Since the energy system is both the primary cause of climate change and the primary means of mitigation, the future evolution of energy policy is of critical importance. But energy policy is undergoing significant change for other reasons, including unstable and substantially higher oil and gas prices, conflict and instability in key producing regions such as the Middle East, fears of the economic consequences of declining world oil production and a rising perception of energy insecurity, especially within industrialised countries. While there are precedents for managing these developments, effective response to them all while at the same time radically reducing carbon emissions requires a major rethink of conventional assumptions and practices.

The view that economically justified energy-efficiency improvements will increase rather than reduce energy consumption was first put forward by the British economist, William Stanley Jevons in 1865 (Jevons, 1865). If it were true, ‘Jevons’ Paradox’ would have profound implications for sustainability. It would imply that encouraging energy efficiency as a means of reducing carbon emissions would be futile — rather like a dog chasing its tail. The conventional assumptions of energy analysts, policy-makers, business and lay people alike would be turned on their head and the dominant strategies for achieving sustainability would be undermined. This would be all the more the case if, as seems logical, the Paradox applied to resource efficiency more generally, rather than just energy efficiency. But is the Paradox logically coherent? Do the arguments in its favour stand up to close scrutiny? What empirical evidence is available to suggest that it is correct?

Climate policy in EU Member States is becoming increasingly crowded. Multiple instruments have been introduced at both the Member State and EU levels and new instruments are regularly being proposed. As the number of instruments grows, so does the potential for interaction between them. This interaction can be complementary and mutually reinforcing, but there is also the risk that different policy instruments will interfere with one another and undermine the objectives and credibility of each. The central aim of the EU-funded research project “Interaction in EU Climate Policy” (INTERACT) has been to develop a systematic approach to analysing policy interaction and to use this approach to explore the potential interactions between the proposed EU Emissions Trading Scheme (EU ETS) and other instruments within both EU and Member State climate policy.

As the number of environmental policy instruments grows, so the potential for interaction between different instruments increases. This interaction can be detrimental or beneficial. To avoid conflict, it is essential that the potential for interaction be assessed during the formulation of new policy instruments. This paper illustrates this through an analysis of how the European Directive on Integrated Pollution Prevention and Control might interact with future schemes for carbon emissions trading. Both instruments encourage industrial energy efficiency, but in fundamentally different ways. This is demonstrated through a detailed comparison of the two policy instruments, followed by the development of three implementation scenarios for IPPC, in which the interaction with potential carbon trading schemes is assessed. The paper concludes that the interpretation of the IPPC energy efficiency requirements could either constrain or facilitate the participation of regulated installations in any carbon trading scheme.

This paper provides an overview of the UK market for energy service contracts in 2014 and highlights the growing role of intermediaries. Using information from secondary literature and interviews, it identifies the businesses offering energy service contracts, the sectors and organisations that are purchasing those contracts, the types of contract that are available, the areas of market growth and the reasons for that growth. The paper finds that the UK market is relatively large, highly diverse, concentrated in particular sectors and types of site and overwhelmingly focused upon established technologies with high rates of return. A major driver is the emergence of procurement frameworks for energy service contracts in the public sector. These act as intermediaries between clients and contractors, thereby lowering transaction costs and facilitating learning. The market is struggling to become established in commercial offices, largely as a result of split incentives, and is unlikely to develop further in this sector without different business models, tenancy arrangements and policy initiatives. Overall, the paper concludes that energy service contracts can play an important role in the transition to a low-carbon economy, especially when supported by intermediaries, but their potential is still limited by high transaction costs.

Direct rebound effects result from increased consumption of cheaper energy services. For example, more fuel-efficient cars encourage more car travel. This study is the first to quantify this effect for personal automotive travel in Great Britain. We use aggregate time series data on transport activity, fuel consumption and other relevant variables over the period 1970–2011 and estimate the direct rebound effect from the elasticity of both vehicle and passenger kilometres with respect to: a) vehicle fuel efficiency (km/MJ); b) the fuel cost of driving (£/km); and c) road fuel prices (£/MJ). We estimate a total of 108 models, paying careful attention to methodological issues and model diagnostics. Taking changes in fuel efficiency as the explanatory variable, we find little evidence of a long-run direct rebound effect in Great Britain over this period. However, taking changes in either the fuel cost of driving or fuel prices as the explanatory variable we estimate a direct rebound effect in the range 9% to 36% with a mean of ~19%. This estimate is consistent with the results of US studies and suggests that around one fifth of the potential fuel savings from improved car fuel efficiency may have been eroded through increased driving. We also show how the normalisation of distance travelled (per capita, per adult or per driver) affects the results obtained.