Throughout this report energy savings means primary fuel displaced and hydroelectric energy savings are 3.0 quads and biomass energy savings are 1.6 quads.

EXHIBIT I

GROWTH OF ANNUAL ENERGY SAVINGS1 BY
MARKET SECTOR-REFERENCE CASE

Thus,

Includes fossil fuel equivalent of end use electricity demand as well as demand of energy for generation. there is double accounting of intermediate fuels and energy produced from those fuels. Actual gross demand is 115 quads.

Includes current use of 0.3 quads of biomass in the residential sector and 1.6 quads in the industrial sector. Includes 3.0 quads current use.

"Less than 0.1 quads.

Source: The MITRE Corporation, June 1979.

7

APPENDIX C

(Source: Energy Conservation and Public Policy,
edited by John C. Sawhill (Prentice-Hall, Inc.,
for The American Assembly, Columbia University, 1979)
Denis A. Hayes

9

Short-term Solar Prospects

We are not running out of energy. Ninety-nine percent of all the energy that will ever be available for human use is in the sunlight that strikes the earth. Humankind's current commercial energy budget equals only 0.01 percent of this solar influx; a hundredfold increase would equal only 1 percent. Fundamental physical limits will constrain energy growth long before it multiplies a hundredsold.

We are not depleting this most plentiful source of energy. Unlike fossil and fissile fuels, sunlight is a flow and not a stock. Once a gallon of oil is burned, it is gone forever; but the sun will continue to cast its rays carthward, whether sunshine is harnessed today for human needs or not. Technical improvements in the extraction of finite fuels could hasten their exhaustion; similar improvements in the use of sunlight could lower prices permanently. The sun will eventually collapse upon itself, becoming a dense "black hole" that emits no energy at all. But the best guess of informed scholars is that this event will not occur for three or four billion years.

Although we are not running out of solar energy, we are running out of cheap oil and gas. The United States was largely built on oil that cost two dollars per barrel. International oil now costs $13.50, and some analysts expect this price to rise to twenty-five dollars per barrel within the next ten years. As the price of our most important energy source climbs steadily higher, dramatic social changes may be unavoidable.

Most such changes will manifest themselves in the substitution of relatively cheaper factors of production for energy. Materials (c.g., insu

DENIS A. HAYES is Senior Researcher with Worldwatch Institute, a private or ganization in Washington which analyzes global issues. Formerly he was director of the Illinois State Energy Office.