By Institute for Energy Research ——Bio and Archives--October 31, 2014
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“Energy alone is not sufficient for creating the conditions for economic growth, but it is certainly necessary. It is impossible to operate a factory, run a shop, grow crops or deliver goods to consumers without using some form of energy. Access to electricity is particularly crucial to human development as electricity is, in practice, indispensable for certain basic activities, such as lighting, refrigeration and the running of household appliances, and cannot easily be replaced by other forms of energy.”This means that improving economic and human development almost certainly entails increasing the use of energy around the world. ThinkProgress, on the other hand, argues that we have not seen meaningful growth in recent years:
“We have not been growing in any meaningful sense of the word for a while now — certainly not the kind of growth that matters to our children and grandchildren and countless future generations encompassing billions and billions of people.”Tell that to China and India’s residents, who have experienced higher standards of living and greater prosperity over the last three decades or so. Today, hundreds of millions of people in those countries are no longer desperately poor because of economic growth and the growth in the use of energy. Both countries have seen higher life expectancies at birth, more widespread access to improved sanitation facilities, and a lower child mortality rate. Energy growth has fueled these improvements. It is not just China and India, though—a similar story is true in both Brazil and the U.S. The following chart, using data from the World Bank and BP’s Statistical Review of World Energy 2014, illustrates the relationship between higher energy use and greater standards of life (including declining PM10 air pollution): In the U.S., the Environmental Protection Agency also illustrates the relationship between higher energy use and prosperity. The following chart reveals that, as energy consumption and vehicle miles traveled have increased, so has economic growth, while air pollution has dropped off over time: The use of energy is ultimately vital to living standards, and it is not simply “for the sake of growth.” India, China, Brazil, and the United States have seen not only dramatic increases in energy growth, but also improvements in human welfare. This energy growth surely does not seem like “growth for growth sake.” Basic activities such as refrigerating food and medicines as well as air-conditioning schools and hospitals are impossible without affordable, reliable energy. Life-saving technologies, too, such as incubators for children born prematurely, also cannot exist without reliable electricity. Because more than 1 billion people do not have access to electricity, the world’s energy use will continue to grow as more people gain access to these improvements.
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The Institute for Energy Research (IER) is a not-for-profit organization that conducts intensive research and analysis on the functions, operations, and government regulation of global energy markets. IER maintains that freely-functioning energy markets provide the most efficient and effective solutions to today’s global energy and environmental challenges and, as such, are critical to the well-being of individuals and society.