Energy Forecasts: Sinking to New Lows

Abstract

Forecasters have been revising downward te figures for energy demand during the past decade at such a rate that what was once considered a utopian vision is becoming accepted as conventional wisdom. Old econometric models are bein discarded as new relationships are introduced. A striking indication of change lies in the shifting relation between energy and the gross national product. Before the 1973 to 1974 oil embargo, energy use increased faster than economic growth. Since then, however, that trend has reversed. Energy demand now increases less rapidly than the economy. The experts' forecasts for energy use in the United States for the year 2000 or 2010 have changed so radically that the lowest energy-demand projection (125 x 10/sup 15/ Btu) made in 1972 by Amory Lovins, a low-growth advocate, was higher than the highest projection (124 x 10/sup 15/ Btu) made in 1977 to 1978 by Ralph Lapp. The author cautions that it does not mean the new trend in energy prophecy will produce more-accurate information than the old trend. The abrupt reversal does suggest, according to the author, that a radical change is working its way through the economy. (SAC)