Energy efficiency standards: voluntary or mandatory

The problem of promoting energy conservation is considered to be a problem of information transfer. The purpose of energy policy is to close the gap between increasing demand and decreasing supply according to what method is cheapest, environmentally acceptable, and fastest. Conservation is quick, available now, and desirable from an environmental standpoint, but, most important, it is economical. This paper shows examples of conservation investments (e.g., thermal insulation, preheaters, more efficient automobiles, and heat exchangers) that pay off in terms of the cost of the energy saved compared to initial cost of installation. Whether conservation standards should be voluntary or mandatory depends on the number of people involved in establishing a standard and the complexity of the standard. For most products voluntary standards are considered the best approach. (BYB)