Building and Transportation Electrification

Building Automation and Transportation Energy Solutions

Demand-side management (DSM) programs in the U.S. have been expansionary in scope, scale, and structure. This expansion can be traced to the U.S. dependence on foreign imported oil which peaked in the 1970s, with its attenuated threats on national security.

Hitherto, a vigorous debate over the efficacy of DSM programs has also emerged. At one end of this debate are DSM advocates who see the significant potential of investments in energy efficiency that can be obtained at low and even negative costs. At the other end of the debate are economists who question the “proverbial DSM free lunch.”

DSM opponents argue that if these programs are cost-effective as they are often claimed then why are they under-appreciated by firms and consumers?

They point to imperfect market information, and not factoring in the full costs of negative externalities in energy prices, as the reason why to paraphrase Amory Lovins, we have chosen the “hard paths” over the “soft paths.” So why aren’t we promoting the soft path?

This research thrust investigates two energy efficiency gap perspectives in transportation, smart mobility, and smart cities and their hidden assumptions i.e., (i) a technological-oriented perspective that emphasizes engineering-economic calculations, and (ii) a market-oriented perspective fronted by economists who look at the issues from market failure and social welfare point of view. The thrust studies infrastructure investment, “uncertainty” in energy efficiency measurement and finance.

Finally, this research thrust focuses on the economic imperatives of transportation, smart mobility, automation, and energy infrastructure investment.