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UC Berkeley Haas Partners with MIT Sloan on Energy Efficiency Research Project

Researchers at the Haas School of Management at the University of California at Berkeley are teaming up with researchers at the MIT Sloan School of Management to take a closer look at energy-efficiency policies and regulations around the globe to determine whether they are realizing their full potential, the schools announced this week.

The project, called E2e, is an interdisciplinary collaboration between the two schools designed to find the best way to go from using a large amount of energy (“E”) to a small of amount of energy (“e”). Participating experts will include engineers, economists and others, and the initiative is led by Catherine Wolfram, associate professor and co-director of the Energy Institute at Haas, Michael Greenstone, a professor of environmental economics at MIT, and Christopher Knittel, co-director of the MIT Center for Energy and Environmental Policy Research (CEEPR).

The collaboration is designed to measure the actual energy efficiency of given policies and regulation by leveraging cutting-edge scientific and economic insights, the researchers say. “The E2e Project is focused on singling out the best products and approaches by using real experiments centered on real buying habits. It will provide valuable guidance to government and industry leaders, as well as consumers,” Haas’s Wolfram said in a statement.

The McKinsey Curve – a cost curve that shows that abating emissions actually pays for itself – serves as one of the group’s motivations for studying energy efficiency. “Our goal is to better understand what the costs and benefits of energy-efficient investments are—where the low-hanging fruit is, as well as how high that fruit is up the tree,” MIT’s Knittel said in a statement. “The McKinsey curve would suggest the fruit’s already on the ground. If this is true, we want to figure out why no one is picking it up.”

Some of the other issues the project will evaluate are whether consumers and businesses are bypassing profitable opportunities to reduce their energy consumption and how best to encourage individuals and businesses to invest in energy efficiency. Already, the team is tracking consumers’ vehicle purchasing decisions to discover whether better information about cars’ fuel economy leads to the purchase of more fuel-efficient vehicles.

The E2e Project features an advisory board made up of several prominent figures focused on energy, including Former U.S. Secretary of State George P. Shultz, who leads the Energy Policy Task Force at Stanford University’s Hoover Institution; MIT Institute Professor John Deutch, former undersecretary of the Department of Energy; and Cass Sunstein, a professor at Harvard Law School and President Obama’s former director of regulatory affairs

“I like the saying ‘A penny saved is a penny earned,’ which rings true from the standpoint of energy,” Shultz said in a statement. “Energy that is used efficiently not only reduces costs, but is also the cleanest energy around. The E2e Project will allow us to better understand which energy-efficiency programs save the most pennies.”

Learn more about the new E2e Project at Haas and MIT Sloan.