Rebound effect – beyond conventional wisdom
October 22, 2019 by David Font Vivanco
Resource efficiency has traditionally been a key pillar of energy and broader environmental policy. This is why more efficient cars, lighting, and irrigation systems, to name a few, have been widely endorsed by both private and public management. Yet this pervasive efficiency narrative is now being challenged by the so-called rebound effect. So what is this rebound effect and how does it affect everyday choices?
Let’s assume a case where Mike and Penny want to replace their old car with a new one that is 10% more fuel efficient, believing they will save the environment a 10% energy use.
But what happens if the couple actually change their driving behavioural due to the perceived efficiency change? For example, they might now spend the resulting economic savings from reduced fuel use on other products, including additional driving. Also, their driving behaviour may change in light of their perceived ‘good deed’. Indeed, they may feel morally licensed to buy a bigger car, turn the AC more regularly, or even buy a second car (Santarius and Soland 2018). All of these indirect consequences constitute the so-called rebound effect. When a given resource efficiency measure leads to overall increased resource use, we speak of a backfire effect or the Jevon’s Paradox in relation to the seminal work by William Stanley Jevons (1865).
Estimating the rebound effect entails isolating the effect that any perceived efficiency plays on resource use. In other words, Penny and Mike would have needed to first estimate their current energy use, and then estimate which share would be attributable not just to driving the car, but to the change in efficiency of the new car with respect to the old one. Such a daunting task has led to multiple approaches and ultimately a polarised debate between those who argue that rebound effects are modest in size, easily addressed, and generally overplayed (Gillingham et al. 2013) and those who argue that the Jevon’s Paradox takes place in multiple contexts and a better understanding of rebound effects is needed to guide environmental policy worldwide. Some of us from the latter group have edited a Research Topic in Frontiers in Energy Research and Frontiers in Sociology entitled “The Rebound Effect and the Jevons’ Paradox: Beyond the Conventional Wisdom” (editorial).
This special issue focuses on unconventional approaches to study rebound effects. The Research Topic includes seven theoretical works and case studies that shed new insights into the study of rebound effects: from the theories of complex adaptive systems and moral licensing to applications of system dynamics and industrial ecology models.
Dr. Tamar Makov from Yale University and I contributed a paper on rebound effects from smartphone reuse going beyond the traditional focus on energy efficiency to show how rebound effects may apply to circular economy strategies (Makov and Font Vivanco 2018). We show how imperfect substitution between recycled and new products, together with re-spending of the cost savings, could erode around one third—and potentially all—of the emission savings from smartphone reuse. Could this also apply to Penny and Mike’s car?
The special issue demonstrates the limitations of the current framing of rebound effects and show how this phenomenon has deeper roots in system behaviour, human psychology, and social organisation. The articles reinforce the argument that rebound effects are larger than many have assumed, and therefore present a critical challenge for environmental sustainability.
The critical challenge is to reconcile the economic growth with sustainability ambitions and bring the rebound effect issue into the policy arena (Font Vivanco et al. 2016a). For genuine sustainability, a good understanding of rebound effects is needed to avoid unintended consequences. I believe the life cycle-based approaches combined with tools that capture complex human and broader systemic behaviour, such as econometric (Font Vivanco et al. 2016b), quasi-experimental (Makov and Font Vivanco 2018), and macro-economic (Font Vivanco et al. 2019) tools offer untapped potential for business and governmental organisations to mitigate rebound effects and achieve their sustainability targets.
Font Vivanco, D., Kemp, R., and van der Voet, E. (2016a). How to deal with the rebound effect? A policy-oriented approach. Energy Policy, Elsevier, 94, 114–125.
Font Vivanco, D., Nechifor, V., Freire-González, J., and Calzadilla, A. (2019). Economy-wide rebound makes UK’s electric car subsidy fall short of expectations. Renewable & Sustainable Energy Reviews, (accepted).
Font Vivanco, D., Tukker, A., and Kemp, R. (2016b). Do Methodological Choices in Environmental Modeling Bias Rebound Effects? A Case Study on Electric Cars. Environmental Science and Technology, 50(20).
Gillingham, K., Kotchen, M. J., Rapson, D. S., and Wagner, G. (2013). Energy policy: The rebound effect is overplayed. Nature, Nature Publishing Group, a division of Macmillan Publishers Limited. All Rights Reserved., 493(7433), 475–476.
Jevons, W. S. (1865). The Coal Question. An inquiry concerning the progress of the nation and the probable exhaustion of our coal-mines. Macmillan and co., Cambridge, UK.
Makov, T., and Font Vivanco, D. (2018). Does the Circular Economy Grow the Pie? The Case of Rebound Effects From Smartphone Reuse. Frontiers in Energy Research, Frontiers, 6, 39. https://www.frontiersin.org/articles/10.3389/fenrg.2018.00039/full
Santarius, T., and Soland, M. (2018). How Technological Efficiency Improvements Change Consumer Preferences: Towards a Psychological Theory of Rebound Effects. Ecological Economics, Elsevier, 146, 414–424.