There’s a pernicious argument being made against energy efficiency, and it goes like this. Last winter was one of the warmest on record, so people had to spend less to heat their homes and businesses. That, combined with a “drilling binge ” in shale gas and new production, made for record low natural gas in prices in April, at less than $2 per million British thermal units (MMBtu). This phenomenon has boosted the U.S. economy to the tune of more than$ 100 billion annually, by one estimate. With such low prices, the thinking goes, investments in alternative energy and energy efficiency don’t make sense.
“All bets are off for the future of energy in the United States and, indeed, the world, as the price of natural gas plummets to ever-lower values,” the University of Virginia’s S. Fred Singer wrote in the American Thinker last spring. Singer even speculated that “cheap gas will completely remove the need for electricity generated by solar or wind.” In August, a Deloitte study found that current low prices were making many energy efficiency projects less attractive, since it would take too long to show a return on investment.