The paper discusses the factors influencing energy efficiency and conservation decisions and explores appropriate policies to promote these practices. It highlights the importance of energy efficiency and conservation in reducing environmental impact, particularly climate change, and in decreasing external dependence and vulnerabilities in the energy sector. The authors argue that while not all public policies are justified, specific policies based on economic instruments or consumer information provision may be necessary. The paper is structured into five sections. The introduction defines energy conservation and efficiency, outlines the benefits of energy conservation, and reviews the political support for energy efficiency in the European Union. It also discusses the paradoxes surrounding energy efficiency, including the energy efficiency gap and the rebound effect. The second section analyzes the energy efficiency paradox, examining the reasons for the underinvestment in energy efficiency despite its socio-economic benefits and the growth of total energy consumption despite improvements in energy efficiency. It explores various market failures and barriers that may explain these paradoxes, such as low energy prices, high investment costs, uncertainty and irreversibility of investments, information failures, bounded rationality, slow technology diffusion, principal-agent problems, and imperfections in capital markets. The third section presents ideas about the elements to be included in public policies for energy conservation. It discusses different policy instruments, including technological standards, tradable white certificates, taxes, subsidies, and information policies. Each instrument is evaluated based on its effectiveness, efficiency, and potential rebound effects. The fourth section offers recommendations on general guidelines for future policies. It emphasizes the need to target market failures or barriers and to avoid free-riding behavior. It suggests that a combination of policy instruments may be the most effective approach to promote energy conservation. The conclusion reiterates the importance of considering energy efficiency policies as means to achieve broader socio-economic and environmental objectives. It stresses the need to prioritize policies directly targeted at reducing environmental impact and to correct market failures. The paper also highlights the need to avoid mistaking efficiency for conservation and to modify the orientation of energy efficiency policies to focus on real savings. Finally, it calls for more economic analysis of the effectiveness and efficiency of energy conservation policies.The paper discusses the factors influencing energy efficiency and conservation decisions and explores appropriate policies to promote these practices. It highlights the importance of energy efficiency and conservation in reducing environmental impact, particularly climate change, and in decreasing external dependence and vulnerabilities in the energy sector. The authors argue that while not all public policies are justified, specific policies based on economic instruments or consumer information provision may be necessary. The paper is structured into five sections. The introduction defines energy conservation and efficiency, outlines the benefits of energy conservation, and reviews the political support for energy efficiency in the European Union. It also discusses the paradoxes surrounding energy efficiency, including the energy efficiency gap and the rebound effect. The second section analyzes the energy efficiency paradox, examining the reasons for the underinvestment in energy efficiency despite its socio-economic benefits and the growth of total energy consumption despite improvements in energy efficiency. It explores various market failures and barriers that may explain these paradoxes, such as low energy prices, high investment costs, uncertainty and irreversibility of investments, information failures, bounded rationality, slow technology diffusion, principal-agent problems, and imperfections in capital markets. The third section presents ideas about the elements to be included in public policies for energy conservation. It discusses different policy instruments, including technological standards, tradable white certificates, taxes, subsidies, and information policies. Each instrument is evaluated based on its effectiveness, efficiency, and potential rebound effects. The fourth section offers recommendations on general guidelines for future policies. It emphasizes the need to target market failures or barriers and to avoid free-riding behavior. It suggests that a combination of policy instruments may be the most effective approach to promote energy conservation. The conclusion reiterates the importance of considering energy efficiency policies as means to achieve broader socio-economic and environmental objectives. It stresses the need to prioritize policies directly targeted at reducing environmental impact and to correct market failures. The paper also highlights the need to avoid mistaking efficiency for conservation and to modify the orientation of energy efficiency policies to focus on real savings. Finally, it calls for more economic analysis of the effectiveness and efficiency of energy conservation policies.