About a week ago I did a short post on Prius/oil-related matters that seemed to irritate a few folks. I hadn’t noticed until today that our occasional contributor (and pundit nonpareil) Clark Williams-Derry posted a response. He seemed to be approaching the question the same way some other people did, so I thought I’d offer a reply.

To recap:

A Wall Street Journal editorial (sub.) said this:

Petroleum not consumed by Prius owners is not “saved.” It does not stay in the ground. It is consumed by someone else. Greenhouse gases are still released.

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Treehugger’s Lloyd Alter said (I paraphrase): What a jerk.

I said (again paraphrasing): Yes, he’s a jerk, but on this narrow point, he’s right.

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Several commenters thought I was making a point about the futility of energy conservation generally. But I wasn’t — the point is about oil in particular.

Bart, and at greater length Clark, mentioned the "rebound effect," whereby reduced demand lowers price, which subsequently raises demand. Both of them make the point that although the rebound effect is real, demand only bounces back about 30-50%. So, while using less oil may not make the total efficiency gains you’d want, it does make some efficiency gains. It does save some oil.

To which I say: For "energy" generically, yes. For electricity, yes. For something like coal, where supply is plentiful, yes. But oil?

Let’s stipulate the following: At some point, the economics of oil are going to be such that it’s no longer a cost-effective energy source for most uses.

There are two ways this could come about.

One, global oil supply could level off and then decline, while demand skyrockets, making oil prohibitively (and perhaps suddenly) expensive. In this case, the need for oil still exists — in that no other combination of energy sources has yet filled the gap — but demand is suppressed by sky-high prices. Severe economic dislocation, resource wars, etc., possibly ensue.

Two, alternative energy sources could develop and fall in price, and oil conservation efforts could catch on. In this case, there would still be ample oil supply remaining, and cheap, but without any demand.

The second scenario would be nice — a real global triumph for environmentalists — but I find it highly unlikely.

More likely, to me, is an enormous rising tide of demand that totally swamps dwindling supply. We suck the remaining oil out of the ground at breakneck pace until finally, scrabbling on our hands and knees at the tar sands, we finally toss in the white flag.

In short (speaking somewhat imprecisely, of course): We use the oil up.

If this is the likely scenario, then a tiny shaving off U.S. demand is a drop in a very large bucket. Hell, even a drop of 20% or 30% in U.S. demand won’t change the essential dynamic. The oil’s gonna get used.

Or rather: Petroleum not used by Prius owners will not be "saved." It will not stay in the ground. It will be consumed by someone else. Greenhouse gases will still be released.

Can someone tell me where I’ve gone wrong in this line of reasoning?