What does it take to produce the things that we truly value in our lives? It takes ideas, labor, tools, machines, and raw materials. But a fundamental necessity is energy. Everything we make requires it. So it would be natural to assume that as our economy grows, our demand for energy would grow at least as much. Simple population expansion ought to drive this growth—in addition, as standards of living rise, people want more goods and services, which themselves have grown, becoming more complex and elaborate to meet more demanding needs and tastes.
But, in fact, energy demand does not increase according to the increase in value of goods and services produced. As a modern economy grows, it takes less and less energy to produce the same total value (even after adjusting for inflation) of these goods and services. “Energy intensity” is the formal measure of this ratio, defined as the amount of energy in British thermal units required to produce one dollar of gross domestic product (GDP, the value of an economy’s output). And intensity has been declining over time, not just here in the United States but in every advanced economy in the world. This trend is expected to continue: According to the Energy Information Administration’s (EIA’s) current projections, it will require two-thirds as much energy to produce the same value of goods and services in 2030 as in 2012—that would be less than a third of the energy required in 1950.