# Fall wk 6 – Mon.1.Nov.04 • Welcome, roll, questions, announcements

```Fall wk 6 – Mon.1.Nov.04
• Welcome, roll, questions,
announcements
• Energy Ch.4: Demand
• Discuss midterms
Energy Systems, EJZ
Review of week 5
Conferences
Research workshop
Library workshop
Writing workshop
Research proposals
Physics Ch.7+8 HW: Energy and Work
Plan for week 6
Monday: Energy Ch.4, Demand
Seminar: Power to the People
Tuesday: Calculus Ch.2: Differentiation
Thursday: Debate on Local vs Central
Infrastructure
Friday: Energy essays
What will happen to the economy if we use less
fossil fuel?
Can we cut consumption without sacrificing
quality of life?
Conservation, efficiency, or resource
substitution?
If we cut consumption, how and by how much?
Do we really need what we consume?
How does energy demand and efficiency depend
on price and other variables?
What does demand depend on?
Q=demand
(a)
Q=demand
(b)
P=price
Q=demand
(c)
F=fashion
time
(a) Classical market model: demand falls if price increases
(b) Variables: Demand may increase with fashion
(c) Consider both, and assume fashionability and price both
increase in time
Elasticity: how does demand Q
depend on price P?
Q
Q
(a)
Q=demand
(b)
P
(c)
P
(a) Demand depends strongly and variably on price
(b) Linear elasticity
(c) Inelastic: demand independent of price
P
Elasticity =
slope of normalized Q(P) curve
Can we reduce energy use yet increase
(or maintain) GDP (or quality of life)?
Energy use
(a)
conservation
(b)
income
Quality of life
Fig.4.4: It looks like we need increased energy use for a
better quality of life: DISCUSS
Energy use and GDP increase in lockstep?
Hypotheses: price drop increased energy use 
increased production,
but increased energy use not required for increased GDP
* Efficiency e  GDP/Energy demand
Energy
demand
(a) If energy demand is inelastic, we’re in
trouble
(a)
P
E/GDP  1/ e
(b) Efficiency is too expensive in short
term, but cost-effective in longer term
* How does energy really demand depend
on price?
* How does efficiency really depend on
price?
(b)
P
* Time lag between price change and
Test the hypotheses – plot the data
Q/GDP
Team A: Plot Energy consumption Q
per \$ GDP vs time (Table 4.1)
(A)
t
Real Price
Team B: Plot real price vs time (Table
4.3)
(B)
t
Q/GDP
Team C: Plot Q/GDP vs price (Tables
4.1 and 4.3)
(C)
P
Conservation potential in the US
Large-scale power plants are more efficient Unless you consider transportation costs Then small-scale distributed power more efficient
Efficiency (GDP/Q) versus conservation (MEOW)
Substituting resources: cheaper fuels, renewables
Homes: heating, insulation, lighting
Industry: coal to steam; shift to service industry
Transportation ~ 30% of total demand (half for cars)
Will we have another fuel crisis? Then what?
Easier to change markets than consumer taste?
Role of incentives and penalties?
Interventionist conservation policy? Tax credits
for efficient buildings, end oil subsidies, …
Which is preferable, free choices and market, or
greater govt. control?
What choices do developing nations have?
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