What Paul Heyne refers to as "The Law of Demand" says that as prices rise, ceteris paribus, people will in general want to buy less of the product. It is true for energy as well as every other product.
So if additional energy conservation is somehow "a good thing", then a great way to reach that goal is force energy prices up. In fact, that is what has been done in Copenhagen:
How, then, has Denmark been so successful in managing its carbon emissions? The answer lies not with the source of power, but with the price of power. At 30 cents per kilowatt hour, electricity costs anywhere from three to five times what the average North American would pay. And, not surprisingly, Danish households consume a fraction of the power that we do....
The other reason commonly cited for Denmark’s success at carbon management is cars—or, more precisely, the lack thereof. Nearly everyone in Copenhagen seems to be riding a bicycle. At first I thought this was testament to the environmental consciousness of the populace, or at a minimum, to a commitment to physical fitness. Then I checked out what it costs to buy a car....
Depending on how many horses are under the hood, Danish car buyers pay a tax ranging anywhere from 100 to 180 per cent of the sticker price of the vehicle. In other words, when you purchase a car in Copenhagen, you can pay almost as much as if you were buying three cars in North America. At that tax rate, I’d be riding a bike too.
What I learned from my trip to Copenhagen is that you don’t have to be a world leader in green energy technology to cap your carbon emissions. Just charge 30 cents per kilowatt hour for power, and slap a 180 per cent surcharge on vehicle prices. Consumers will do all the rest.
That piece is by Jeff Rubin and appeared in The Globe and Mail. It's a great example of how to use prices to conserve scarce resources, assuming there is a good reason to conserve them.