Abstract Average energy consumption per U.S. household has fallen by just under 20% in the last ten years. Much of this drop occurred after 1979, when gas and electricity prices as well as oil prices rose in real terms. The response of households to higher prices has involved physical modifications on and in the home and changes in behavior. Many actions have been taken by households, but the most important single factor has been a significant reduction in indoor temperatures. The greater energy efficiency of new homes and appliances has also helped to depress residential energy demand, although improvements have levelled off in the last few years. There are signs that the momentum of energy conservation is less now than it was 2 years ago, but it appears that energy prices will be high enough to discourage households from returning to former energy-using practices. Along with the continued replacement of homes and appliances with more efficient models, and other factors such as the migration to wanner regions and the movement to more apartments and smaller homes, this will probably keep U.S. residential energy consumption at about its present level through the 1980s.