Finding Energy Efficiency in an Unexpected Place – The Cockpit

Energy Institute at Haas, June 27, 2016

I suspect that most energy economists think there are more unexploited opportunities for energy efficiency in homes than in firms. Firms are cost-minimizers, after all – they’re in the business of making things with the fewest possible inputs. And, energy is an important input for many firms, particularly airlines. So, not even McKinsey – in their exhaustive catalog of potential energy efficiency measures – identify improved fuel efficiency from airlines.

Surprisingly, a new NBER working paper finds a significant opportunity for fuel savings in the airline industry. In a research coup that makes people like me drool with envy, Greer Gosnell, John List, and Rob Metcalfe convinced Virgin Atlantic Airways to let them run an experiment. And, not just any experiment – one that involved their captains, the head honchos, as in, “This is your captain speaking.”