Demand elasticity for oil is low, about 0.5; so a 1 percent increase in oil price would cause a 0.5 percent decrease in consumption. That makes sense, since in the short run, it's hard for people to cut energy consumption, especially if they must drive to work. But, though numbers are hard to come by, elasticity of supply is much, much lower, for two reasons. First, oil production takes decades and billions in capital investment; producers cannot quickly increase or decrease supply. Second, oil producers form an international cartel, an organized mega-monopoly, which holds down production to drive up prices. Since they're already charging what the traffic will bear, they can't much raise prices to cover a tax.
This article is about efficiency, as the investments in energy efficiency programs created revenue and new jobs. Resources are not being wasted by inefficient use. The efficiency could also be related to economies of scale, since the firm is experiencing increasing returns to scale- every million dollars invested resulted in revenue and new jobs, and hence the work is becoming more efficient and may cause decreases in the long-run average costs.
