Understanding Jevons Paradox
The Victorian Coal Lesson Modern Environmentalists Ignore
Efficiency gains should lower resource consumption, but instead, we see a rebound, especially with energy. This is called the Jevon paradox. What can we learn from a Victorian gentleman who figured this out?
If you bought a hybrid car last year, you probably feel good about your contribution to reducing fossil fuel consumption.
But then something unexpected happened. You started driving more. The money saved on fuel made longer trips seem reasonable, and you took the car when you might have previously walked.
It’s not your fault.
You are exhibiting a common human phenomenon where being more efficient with resources leads us to use more, not less.
This counterintuitive outcome has a name—Jevons paradox—and understanding it will transform how you think about sustainability.
Back in 1865, a Victorian economist noticed something peculiar about coal use. When steam engines became more efficient, coal consumption went up instead of down. This wasn't a quirk of the Industrial Revolution; it's a pattern we see repeating today in everything from water conservation to energy efficiency programs.
In this issue of Mindful Sceptic, you will find out why this matters to you, from making personal decisions about resource use to having more meaningful conversations about our collective future.
Let me show you how a 150-year-old observation about coal could be the key to understanding one of our biggest sustainability challenges.
Jevons Paradox
In 2022, inflation returned to Western economies to challenge everyday expenses.
In Australia, gasoline prices rose by nearly 50% in weeks. Reliant on oil imports to power our vehicles, Australians have copped it from the global cabal. We also have made a mess of our energy supply systems, but that debacle is for another day.
What do I do about the high petrol price?
Well, I could drive less.
I could only get in the car when it was essential, even if that was nearly all the time. Life revolves around the vehicle. Nobody walks to the shops anymore.
What about this idea?
I will get a more efficient car. Trade the gas guzzler for a small runabout with twice the fuel efficiency. Then it's not a problem to drive everywhere because I am saving fuel.
This is the logic of the Jevons paradox, named after the economist William Stanley Jevons, who suggested that as technological advancements improve the efficiency of resource use, the overall consumption of that resource might paradoxically increase rather than decrease.
The paradox arises because when efficiency improves, and the cost of using a resource decreases, it stimulates greater demand for that resource. This increased demand can outpace the savings made through efficiency improvements, resulting in a net increase in resource consumption.
So, if I enhance my car’s fuel efficiency by changing it to a smaller one, I am inclined to drive more or use the car when I might have taken the train to save fuel costs.
Consequently, the total fuel consumption might rise despite my car being more energy efficient and using less fuel per kilometre.
Jevons paradox applies to all resource use but especially energy.
Efficiency gains make it cheaper and more desirable which leads to greater rates of energy consumption together with an increase in the consequences of consumption, such as greenhouse gas emissions.
Jevons described this paradox way back in 1865. He was convinced that introducing energy-efficient steam engines had accelerated coal consumption in Britain. He figured that energy use should have slowed as the cost of steam-powered coal extraction became cheaper.
Efficiency gets more work done for less effort. Because the fuel was attractive, more coal was extracted even though it was more efficient.
We know now that more coal was consumed, not a reduction from increased efficiency. Jevons got that bit right.
Various instances of the paradox where efficiency gains expected to reduce consumption are overwhelmed by material growth and rebound.
Suppose the efficient vehicle I purchased meant saving money that I could now spend running the air conditioner.
Cooler nights gave me better sleep and made me a more effective worker the next day at the office. With higher profits, the companies then reward the workers with raises, who spend the money on goods produced overseas with coal-generated electricity.
So, in this fashion, the ramifications of any given efficiency action can multiply indefinitely, spreading at various rates throughout the global economy.
If these ramblings and logical leaps from economists have a shred of truth, they undermine renewable energy and fuel-efficient strategies to achieve environmental sustainability.
The reality of the human condition—cognitive dissonance and collective denial—means that the Jevons paradox occurs more often than not.
Global energy demand continues to rise alongside the worldwide consumption of coal despite the efficiency of the engines and generators of today, which are unimaginably more efficient than those of the Victorians.
Here is a crucial sustainability example.
Irrigation efficiency and the rebound effect
Water is a crucial resource for global food production.
The amount of agricultural land under irrigation has increased dramatically, especially in Asia, but around the world, irrigated areas have doubled since the 1940s when the agrarian intensification revolution began.
Irrigation efficiency is the proportion of consumed water used by crop plants, precisely the fraction of the consumptive use of water (defined as applied water minus any return flow) that is effective water (defined as water that is beneficially used by a crop). More efficient irrigation technologies increase this proportion to maintain yield with less water.
They also allow crop production on lower-quality soils. Dropped nozzles attach to centre-pivot irrigators and hover right above the canopy of crops, thereby reducing water lost to evaporation and drift.
Drip irrigation, where water is conveyed to plants through pipes for the slow and controlled application of water, can save 25–75% of pumped water compared to flood irrigation.
This sounds good, and it is essential even as an adaptation to climate change that will see declines in the amount and frequency of rainfall in many cropping regions. However, research shows that when technology increases irrigation efficiency, it does not necessarily lead to less groundwater consumption.
If demand for groundwater by farmers is elastic enough, if the higher efficiency technology operates at a lower marginal cost, and if the higher efficiency technology increases revenue, then irrigation efficiency will increase applied water—a rebound effect.
Jevons paradox again.
Researchers in China found that although the water productivity of China’s agricultural sector has increased over the last 20 years via improvements in irrigation technology, the total agricultural water use did not decline as expected. Instead, agricultural output increased.
Much of the expected water savings from more efficient irrigation technology are offset by increased water use for the resulting increase in agricultural production made possible by the more efficient irrigation technology.
Efficiency does not reduce water use but can increase it.
Learning from the Past to Shape Our Future
When faced with abundance, we invariably find new ways to consume it.
Perhaps William Jevons wasn't just clever in figuring out this fundamental truth about human nature and our relationship with resources. The industrial revolution he witnessed was just the beginning of humanity's unprecedented ability to harness and use energy at scale.
Before coal, human society was constrained by the energy we could extract from muscle, wood, and wind. Every efficiency gain was precious because resources were genuinely scarce.
But coal changed everything.
It wasn't just abundant; it was practically limitless for the needs of the time. When Jevons observed increasing coal use despite more efficient steam engines, he wasn't just documenting an economic curiosity; he was witnessing the birth of our modern relationship with energy.
The scale of this transformation would have been unimaginable to a Victorian gentleman.
Today, Australia's annual coal production of 426 million tonnes and China's massive 3,580 million tonnes dwarf the volumes of Jevons' era. Yet the pattern he identified persists—efficiency gains enable greater consumption rather than conservation.
This brings us to a crucial insight for modern mindful sceptics.
Jevons paradox isn't a paradox at all. It's a window into human behaviour and our remarkable capacity for finding new uses for abundant resources. We are, as history shows repeatedly, genius-level makers of stuff and additional humans, powered by our ability to tap into ever-larger energy sources.
It's not the efficiency improvements that make sustainability harder; it's our drive to do more, build more, and consume more when given the opportunity.
The challenge for us today isn't denying this aspect of human nature but understanding and working with it.
Mindful Momentum
The Energy Diary Challenge
Keep a one-week diary of every time you use an energy-efficient device or appliance. Note not just when you use it, but why.
Did you run your energy-efficient washing machine more often because it's cheaper? Did you leave LED lights on longer because they use less power?
At week's end, reflect on whether efficiency influenced your usage decisions. This simple exercise makes the paradox personal and visible in your daily choices.
Key Points
Jevons paradox reveals a critical flaw in efficiency-based environmental solutions—when we make resource use more efficient, we often consume more of that resource, not less. This counterintuitive outcome, first observed in Victorian-era coal consumption, continues to challenge sustainability efforts today across energy, water, and other resource uses.
The paradox occurs because efficiency improvements lower the cost of resource use, which typically leads to increased consumption through expanded applications or more frequent use. This rebound effect can be seen in modern examples, from fuel-efficient vehicles leading to more driving to water-efficient irrigation systems enabling expanded agricultural production.
Historical evidence supports the reality of this paradox, with coal consumption in Britain rising dramatically despite more efficient steam engines and similar patterns emerging in contemporary water use where efficient irrigation technologies have not reduced overall water consumption but enabled agricultural expansion.
Understanding Jevons paradox challenges us to think more critically about sustainability solutions that rely primarily on efficiency gains. It suggests that technological efficiency alone cannot solve resource consumption challenges without corresponding changes in human behaviour, economic systems, and policy frameworks - a crucial insight for developing more effective environmental strategies.
Curiosity Corner
This issue of the newsletter is all about…
When we get better at using resources, we tend to use more of them - a pattern called Jevons paradox that helps explain why efficiency gains often fail to deliver environmental benefits.
5 Better Questions from This Issue:
1. How do efficiency gains reshape human behaviour rather than just resource use? This question moves beyond simple cause-and-effect to examine deeper patterns in how humans adapt to and utilise new technologies, making it more valuable for understanding sustainability challenges.
2. What makes us expand our consumption when resources become more accessible? Rather than just observing that we use more resources, this question delves into human psychology and social patterns that drive the rebound effect, offering potential insights into solutions.
3. Why do we collectively ignore evidence that efficiency gains often increase total resource use? This cuts to the heart of cognitive dissonance in environmental policy and challenges us to examine why we continue promoting solutions that historical evidence suggests may be counterproductive.
4. How might we design systems that channel human ingenuity toward genuine sustainability rather than just efficiency? This forward-looking question acknowledges human nature while seeking constructive solutions, making it more valuable than critiquing current approaches.
5. What can Victorian-era insights about coal tell us about modern renewable energy transitions? This question uses a historical perspective to gain insight into current challenges, demonstrating how mindful scepticism can draw valuable lessons from the past to inform present decisions.
What would be your better question?
In the next issue
From Dodos to Data: What 400 Years of Extinction Tells Us
In next week's deep dive, we'll follow the evidence trail from that last dodo to today's biodiversity crisis. What have we learned in four centuries of documenting species loss? The emerging patterns tell a surprising story about extinction, human nature, and where we might be headed. Plus, I'll share three practical insights that could change your thoughts about conservation.
I’ve recently purchased some
solar powered air conditioners for my home and the goal is to use more air-con in the very hot summers, contrasting our historical pattern of limiting use to conserve resources. The free use of the resource by day means we can use more, be more active in more parts of our home and ultimately replace conservation with consumption.
In our decades of traffic safety research at the Insurance Corporation of British Columbia, in Canada, we explored this similar paradox under the title “risk homeostasis.” Consider the case of the high-end, 4x4 SUV owner travelling back from skiing while driving on snowy roads. Despite the physics of slowing a hulking vehicle (and the exponential increase to casualty as a function of velocity), these road warriors and top gun drivers will often exacerbate their perilous driving under the false impression that they have increased safety and control.