Demand-side management (DSM) programs in the U.S. have been expansionary in scope, scale and structure. This expansion can be traced to the U.S. dependence on foreign imported oil which peaked in the 1970s, with its attenuated threats on national security. Hitherto, a vigorous debate over the efficacy of DSM programs has also emerged. At one end this debate is DSM advocates who see the significant potential of investments in energy efficiency that can be obtained at low and even negative costs. At the other end of the debate are economists who question the “proverbial DSM free lunch.” DSM opponents argue that if these programs are cost-effective as they are often claimed then why are they under-appreciated by firms and consumers? They point to imperfect market information, and not factoring in the full costs of negative externalities in energy prices, as the reason why to paraphrase Amory Lovins, we have chosen the “hard paths” over the “soft paths.” So why aren’t we promoting the soft path?