The Energy Efficiency and Productivity Benefits of Smart Appliances and ICT-Enabled Networks: An Initial Assessment

Research Report F1402


John A. “Skip” Laitner, Matthew T. McDonnell, and Karen Ehrhardt-Martinez


The U.S. economy shows signs of weakening. Among the reasons for less vigorous economic activity is the inefficient use of resources—and especially the inefficient use of energy. New information and communication technologies (ICT) make possible dramatically reduced costs and higher levels of performance that were unachievable just a decade ago. This report explores the working hypothesis that the United States can enhance its economic productivity and energy efficiency by redirecting larger investments into ICT-enabled networks. Because we lack sufficient data to definitively test this hypothesis, we approach the analysis as a Fermi problem. Our first estimates suggest a potential $600 billion boost in GDP. This productivity benefit is driven, in part, by a 1.1 billion barrel energy efficiency gain that might reduce the nation’s annual energy bill by about $79 billion.