A highly influential report by the McKinsey consulting firm suggests that a large potential for profitable energy efficiency exists in the US, and that substantial greenhouse gas emissions reductions can therefore be achieved at a low cost. This result is consistent with other studies conducted using a bottom-up methodology that dates back to the work of Lovins beginning in the 1970s. Research over the past two decades, however, has identified shortcomings with the conventional bottom-up approach, and this has led to the development of new analytical frameworks that are referred to as hybrid energy–economy models. Using the CIMS hybrid model, we conducted simulations for comparison with the McKinsey results. These exercises suggest [...]
