Nationwide there is a certain frustration about paying utility bills. So much so that people jokingly refer to the experience as paying “futility bills”. These jokers probably view their electric and gas bill as something someone does to them rather than something that they do to themselves, but in all cases it is true that if you do not have a meter you will not have a bill. It’s easy right? Just call those bastards up today and say, come and get this thing out of my yard- or off my house or whatever; then, no bill. Some frustrated bill payers have actually done this and gone “off the grid” with generators or alternate energy systems that include wind and solar. Being your own power company sounds cool, but if it was that easy, more people would do it.
The first thing that you need to know about utility bill paying, is that you are going to be paying one for the rest of your life – one way or another. You may be off the grid and get all your energy from wind and photovoltaic power, but unless you paid cash for that system, you are making loan payments that amount to a “utility bill”. Once you pay off the loan there may be minimal maintenance expenses, but it won’t be zero. And, if you have batteries, in seven to ten years they’ll need to be replaced – so there will always be some type of “utility bill” in time, effort or cash to keep your lights on and beer cold. Even if you get a rental deal where the landlord pays the utilities, a portion of your rent payment covers the utilities. The only way out of paying for utilities is to not have a meter and to not use any electricity or gas of any kind, period.
Why do I make a point of saying “not have a meter and not use any electricity or gas”? Aren’t they the same thing? No. Electric and gas meter costs are coming down, but they are not free. No utility is going to give you a free meter. You will be paying for your meter through a minimum monthly fee on your bill or the meter expense will be built into your energy use fee.
Your Load - In utility language, your house or business is a “load”. This means that your building needs electricity or gas and depending on a long list of variables you either need a little electricity or gas or a lot of electricity or gas. So you are either a little load or a big load or something in between – but in all cases, if you need electricity or gas, you are a load. You will sometimes hear the term “demand”. This is a synonym for “load” because you – or at least your building is “demanding” electricity or gas. This is the source of the term “demand side management” or DSM. If your utility has DSM programs, they are trying to manage the demand, usually downward, to reduce the supply that they have to come up with.
Residential electricity is billed by the kilowatt hour (kWh). The “W” in the abbreviation is capitalized in reference to James Watt. One kilowatt hour is the energy used by a 1,000 watt load in one hour. For example, if you turn on ten 100 watt bulbs for an hour, you use 1 kWh of electricity.
Propane gas is generally billed by the gallon. Natural gas is generally billed by the Therm, or 100 cubic feet (CCF).
It seems elementary, but utilities are businesses. They have to make money to cover their expenses just like any other business. If they are an investor owned utility, they must be concerned about share holder profits. If they are a municipal utility they must be concerned about the needs of the citizens in their city and if they are cooperative utilities, they must meet the expectations of their members. All utilities cover most of the expense of getting the power to you by charging a rate per unit (kWh or CCF). The more you use the more you pay.
All utilities buy wholesale energy, electricity or gas and “distribute” it to customers like you; hence the term “distribution utility”. All utilities have wholesale power expenses and distribution expenses. In most cases the wholesale expense is fifty to eighty percent of the retail rate. All utilities have fixed expenses and variable expenses. Fixed expenses are those expenses that occur whether or not there is a load or demand; like the cost of insurance, depreciation, equipment, billing and administration. There are literally billions of dollars of power poles, wires, pipelines, transformers and meters sitting there across the nation ready to spring into action when you flip the switch or turn the knob. Those expenses don’t go way just because you don’t need electricity or gas this month. Variable expenses are those expenses that change with the load or demand placed on the utility’s supply. The more you use the more your utility has to buy.
Your Bill - In addition to the unit of energy billed, there is usually a minimum monthly charge. Some utilities call this charge an availability of service fee. This fee generally tries to recover the fixed operating expenses mentioned above. If you don’t have a minimum monthly charge on your bill, those fixed charges are rolled into your unit rate. There are pros and cons beyond the scope of this week’s blog for both ways of billing. The more your bill is based on a per unit rate the more control you have over the size of your bill.
Every utility bill payer should know the price per unit (kWh or CCF) and the minimum monthly charge that they are paying. You don’t buy gas for your car without looking at the price per gallon so don’t buy electricity or heating fuel without knowing the price. The number of kWh or CCF used during your billing period will be on your bill. Really, it is there so keep looking. The price per unit is not always on your bill. We are back to that pesky sixth grade math.
You can calculate your rates by simply dividing your total bill by the total units that you used during that billing period. See Table 5.6.A. Average Retail Price of Electricity to Ultimate Customers by End-Use Sector, by State, August 2008 and 2007(Cents per kilowatthour) on the Energy Information Administration website to find local average kWh rates.
Natural gas bills may have a confusing list of other charges that make it hard to find a per unit cost. And, while most residential bills come in units of hundred cubic feet increments (CCF or Therms), statistics a generally listed in thousand cubic feet (MCF). The Energy Information Administration statistics on the average price for natural gas make it harder to compare with your bill.
Every utility payer should also know the billing period for your bill. If you are billed one month for thirty days of use and the next month for 20 days of use, the size of your bill will be different even if you use the same kWh of electricity or the same CCF of gas every day.
The main thing to realize about your utility bill is that it is all under your control. You can elect to never use any electricity or gas or you can pick and choose the appliances and equipment that you buy which directly affects the size of your utility bill.
Deposits – Unlike the gas station, when you buy natural gas or electricity, you don’t pay until after you use it. This means that by the time you pay your first utility bill after moving, the utility has given you at least a month and a half worth of their expensive product without getting paid. And, if you drop dead after seeing your first bill they are out a lot of money. So, most utilities will either check your credit history or require a deposit.
How to complain about your bill - Before you call, look at the meter reading dates. Maybe your son or daughter invited the whole high school football or volley team to spend the weekend during this time and you just forgot about it. Maybe you had the flu and cranked the thermostat to fight the chills.
Stay calm; screaming, or profanity will not serve you well when dealing with utility employees. They have heard it all. They have already heard whatever question, complaint, excuse or threat you are about to tell them, so just chill. Make sure you have your bill in front of you so you can give them your account number. This also helps you stay focused on your complaint and way from inappropriate comments about their relatives or anatomy.
If you think your bill is too high, ask them to help you determine if this is an actual or estimated bill. There should be a code on your bill that will tell you this, but sometimes it’s hard to find.
Next, ask for help verifying the number of billing days. I once thought I had a big bill only to find that last month’s bill was for 22 days and this month’s bill was for 33 days. Sometimes holidays or personnel scheduling screws up the meter reading schedule.
Other things you can ask about include the weather. Some utilities keep track of the weather during billing periods as a service to their customers. Colder or hotter weather usually mean higher utility bills.
If you still can’t come up with a reason that your bill is higher than expected you can ask to have your meter tested, but be careful what you ask for. Meter testing is performed on a meter test board in the meter shop. This means that you are getting a new or refurbished meter if you ask for a test. Most meters are simple mechanical devices. And, like your car, they don’t speed up when they are having trouble. Most utilities have a testing and replacement schedule set by state law. Once in a while you can catch them with a meter that has been in the field too long, but if you do, chances are your bill is going to be higher, not lower after the change. All meter exchanges have to be carefully documented so don’t assume that there is any monkey business going on. Deliberate discrepancies are easy to catch and most utility employees like their jobs.
If none of your questions or requests result in a lower bill, it’s time to tour your house. Obvious problems like leaky hot water faucets, well pumps that never turn off due to line leaks, broken thermostats, stuck valves and things that were left “on” when you thought they were “off”, often trigger more energy use. My favorite discovery during an energy audit for an angry customer was the space heater, plugged into a tool shed with the door left open in January. It’s less embarrassing to take that tour by yourself.
Phantom loads have gotten a lot of press lately and can increase your electric bill by several dollars a month. Phantom loads get their name from the fact that the energy used doesn’t give you anything immediately tangible, like light or toast. These loads result from those remote control devices that are always on. You should have a handle on this problem after you get that appliance meter mentioned in last week’s blog.
Thank you for completing Utility Bill Paying 101. If there is ever anything about your utility bill that you don’t understand, let me know. I’d be glad to help, for free. No I won’t pay your bill for you. Nice try. I will do my best to take the confusion out of what it is you are paying as well as help you wade through a bill interpretation. Just email me. ( mrdaily@markricharddaily.com)
If it’s something you have to do every month for the rest of your life, you might as well get good at it. Understanding what you get from your gas and electric utility gives you one less thing to worry about and makes it less like paying for gas and electric futilities.
© Mark Daily, 2008
Showing posts with label alternative energy. Show all posts
Showing posts with label alternative energy. Show all posts
Tuesday, December 9, 2008
Tuesday, September 23, 2008
Solar Energy Can't do it alone- What about Nuclear Energy?
Proponents of alternate energy generation generally support “green” technologies like solar and wind. These same green advocates often shun nuclear energy and point to a long list of dangers inherent in that technology. Yet blind support of solar power is like demanding that you use rubber bands to power you car. For solar to work, we'll need to make big adjustments in our homes and lifestyles.
Solar powered electricity generation made up less than 1% of the generation mix in 20007. According to the Solar Electric Power Association, there were “473MW [megawatts] of grid-connected photovoltaics installed throughout the entirety of the U.S. as of the end of 2007”. Assuming that this 473 MW of grid tied resource got an average of 6 hours of sun each day, they would produce about 1,035,870 Megawatt hours of electricity in a year.
This is not merely a numbers game. We won’t meet our energy needs by doubling or tripling or even quadrupling our photovoltaic generation.
Nuclear electricity generation produced record levels in 2007. Energy Information Administration data show that nuclear generation climbed slightly this May. “Nuclear output rose 13 percent in May 2008 compared with the preceding month. Even with the increase, generation was slightly below May 2007 (less than half a percent difference). Cumulative generation for the first five months of 2008 is slightly over one percent lower than in the record year of 2007.”
In 2007, 806,486,978 Megawatt Hours of electricity was produced by nuclear reactors in the USA. Thirty two states produce a portion of their electricity from nuclear power and 20% of all electricity produced in the USA came from nuclear reactor generation in 2007.
The challenge here when talking about ways to solve climate change and reduce green house gas emissions tied to electric energy production is the big gap between what the public seems to want for power generation -clean power- versus what the public wants in terms of the growing electricity demand.
One typical residential solar photovoltaic setup with twelve 100 watt PV collectors in a sunny part of the USA might be capable of producing 216 kilowatt hours per month or 2.5 Megawatt hours per year.
The South Texas Project 1 nuclear facility produced almost 12 million megawatt hours in 2007. The smallest nuclear generation facility, Point Beach 1 in Wisconsin produced almost 4 million megawatt hours. It would take over 18,000 homes running 1.2 KW photovoltaic systems in a sunny climate to come anywhere close to the generation output of the smallest nuclear facility.
Let’s face it folks. If we want to maintain our current standard of living it will take more than solar power to run the nation. Actually, it will take advancements in every electricity generation sector plus a lot of conservation success to keep up with projected electricity demand.
William Tucker offers his perspective for going nuclear in his interesting The Case for Terrestrial (a.k.a. Nuclear) Energy. You may not want to hear it, but you really should try to understand all sides in our great energy debate.
For more nuclear facts visit the International Atomic Energy Agency and read some IAEA Newsletters.
Solar powered electricity generation made up less than 1% of the generation mix in 20007. According to the Solar Electric Power Association, there were “473MW [megawatts] of grid-connected photovoltaics installed throughout the entirety of the U.S. as of the end of 2007”. Assuming that this 473 MW of grid tied resource got an average of 6 hours of sun each day, they would produce about 1,035,870 Megawatt hours of electricity in a year.
This is not merely a numbers game. We won’t meet our energy needs by doubling or tripling or even quadrupling our photovoltaic generation.
Nuclear electricity generation produced record levels in 2007. Energy Information Administration data show that nuclear generation climbed slightly this May. “Nuclear output rose 13 percent in May 2008 compared with the preceding month. Even with the increase, generation was slightly below May 2007 (less than half a percent difference). Cumulative generation for the first five months of 2008 is slightly over one percent lower than in the record year of 2007.”
In 2007, 806,486,978 Megawatt Hours of electricity was produced by nuclear reactors in the USA. Thirty two states produce a portion of their electricity from nuclear power and 20% of all electricity produced in the USA came from nuclear reactor generation in 2007.
The challenge here when talking about ways to solve climate change and reduce green house gas emissions tied to electric energy production is the big gap between what the public seems to want for power generation -clean power- versus what the public wants in terms of the growing electricity demand.
One typical residential solar photovoltaic setup with twelve 100 watt PV collectors in a sunny part of the USA might be capable of producing 216 kilowatt hours per month or 2.5 Megawatt hours per year.
The South Texas Project 1 nuclear facility produced almost 12 million megawatt hours in 2007. The smallest nuclear generation facility, Point Beach 1 in Wisconsin produced almost 4 million megawatt hours. It would take over 18,000 homes running 1.2 KW photovoltaic systems in a sunny climate to come anywhere close to the generation output of the smallest nuclear facility.
Let’s face it folks. If we want to maintain our current standard of living it will take more than solar power to run the nation. Actually, it will take advancements in every electricity generation sector plus a lot of conservation success to keep up with projected electricity demand.
William Tucker offers his perspective for going nuclear in his interesting The Case for Terrestrial (a.k.a. Nuclear) Energy. You may not want to hear it, but you really should try to understand all sides in our great energy debate.
For more nuclear facts visit the International Atomic Energy Agency and read some IAEA Newsletters.
Monday, August 25, 2008
Save the Planet Save Your money- This book helps you do both
Looking for a great tax free investment? Wishing for an operating manual for your house? Longing to know how to evaluate your energy using appliances and home heating systems? Puzzled why your electric bill was so high? Frustrated trying to learn what to do about it? Now there are solutions to your problems with a new book by Godo Stoyke.
Energy efficiency guru Amory Lovins has said it for decades. When it comes to electricity generation, saving energy equals constructing energy supply. Now we have a tool to help us reduce the need for more power plants and save cash at home, all at the same time. And, the best part is that if you pick the right energy conservation efforts, you’ll have a better return on investment then anything you can do in the stock market even when the stock market was doing well.
The Carbon Buster’s Home Energy Handbook by Godo Stoyke (New Society Publishers) is the next best thing to an owner’s manual for your home. Chapter by chapter, step by step, this easy to read book lays out choices that you can make in your home to live better, reduce your impact on the globe and keep more money in your pocket and out of the utility company’s cash register.
The best part about saving energy with this book is that it’s short. In only 131 pages, LEED accredited graduate of the University of Alberta Master of Science program, lays out a clear picture of concrete steps you can take to identify your home’s energy appetite, search for unwanted energy hogs and quickly learn what can and can’t save you money.
“The purpose of this book is to show you the most effective and most cost effective ways to reduce your carbon emissions and the best ways to reduce your family’s energy bills.” Stoyke goes on to describe products and technologies that do just that. He explains the way of the Carbon Miser, whose only mission is to get the best return on investment (ROI) versus the Carbon Buster whose emphasis is reducing negative environmental consequences.
In nicely designed appendices Stoyke provides tables that list Efficiency measures with their corresponding carbon reductions, cost savings and payback years. He even lists energy conservation steps according to best return on investment.
This should be one book that everyone has in the house.
© Mark Daily, 2008
Energy efficiency guru Amory Lovins has said it for decades. When it comes to electricity generation, saving energy equals constructing energy supply. Now we have a tool to help us reduce the need for more power plants and save cash at home, all at the same time. And, the best part is that if you pick the right energy conservation efforts, you’ll have a better return on investment then anything you can do in the stock market even when the stock market was doing well.
The Carbon Buster’s Home Energy Handbook by Godo Stoyke (New Society Publishers) is the next best thing to an owner’s manual for your home. Chapter by chapter, step by step, this easy to read book lays out choices that you can make in your home to live better, reduce your impact on the globe and keep more money in your pocket and out of the utility company’s cash register.
The best part about saving energy with this book is that it’s short. In only 131 pages, LEED accredited graduate of the University of Alberta Master of Science program, lays out a clear picture of concrete steps you can take to identify your home’s energy appetite, search for unwanted energy hogs and quickly learn what can and can’t save you money.
“The purpose of this book is to show you the most effective and most cost effective ways to reduce your carbon emissions and the best ways to reduce your family’s energy bills.” Stoyke goes on to describe products and technologies that do just that. He explains the way of the Carbon Miser, whose only mission is to get the best return on investment (ROI) versus the Carbon Buster whose emphasis is reducing negative environmental consequences.
In nicely designed appendices Stoyke provides tables that list Efficiency measures with their corresponding carbon reductions, cost savings and payback years. He even lists energy conservation steps according to best return on investment.
This should be one book that everyone has in the house.
© Mark Daily, 2008
Wednesday, May 21, 2008
Climate Change and the Tooth Fairy
Every once in a while I find myself in one of those conversations that begins with someone saying, “I don’t believe in Global Climate Change”. To me, the issue of Global Climate change is not a matter of belief or disbelief. When the world talks about Global Climate change or politicians or scientists talk about global climate change, they are not talking about a belief at all really. I mean not like “do you believe in Big Foot or the Tooth Fairy”.
Here is the difference. So far no one has been able to cite a documented observation, clear photographic record, or reproducible experiment evaluated by confirming peer reviewed data or evidence on either Big Foot or the Tooth Fairy. A peer group of four year olds might all agree that the tooth fairy does exist, but we should expect a higher degree of professionalism from the scientific community about the issue of Global Climate change.
To that end, a group of scientists have in fact gotten together to look at all of the available data, various studies, some modeling scenarios and a host of other scientific documentation relating to global climate and temperature variations. This data not only covers historic records kept by people, it also includes scientific estimates of historic temperatures, snow and ice levels, based on agreed upon methods of ice core sample research etc.; along with current information.
The results of this work was printed recently in a report called,
An Assessment of the Intergovernmental Panel on Climate Change. This report also included a summary of the findings. This summary, approved in detail at Intergovernmental Panel on Climate Change (IPCC) Plenary XXVII (Valencia, Spain, 12-17 November 2007), “represents the formally agreed upon statement of the IPCC concerning key findings and uncertainties contained in the Working Group contributions to this Fourth Assessment Report” according to their web site introduction.
Everyone that cares about the facts relating to climate change owes it to themselves and the people that may roll their eyes behind their backs when they announce that they do or don’t “believe in global warming”, to read this summary. And, after a winter like we’ve had this year you can just imagine the debate. However, when you look at the numbers and compare studies and ask consistent questions, the facts, according to this Assessment Summary, seem to point to a real change in the temperature of the globe, with shrinking ice and snow fields and rising ocean levels all pointing to unprecedented increases in global temperature.
Then of course the next question would be, “is this a natural change or a man made change?” This same assessment says it is probably a man made change. Now I don’t just mean “probably” like someday I’ll probably have car trouble, I mean that there is a real likely hood based on the evidence that the climate is warming more rapidly now than any natural conditions would predict or explain. The study goes on to say that this trend is consistent with trends in the production of green house gases created by human activity.
Far from being the “hoax” that some headlines flaunt, the issue of climate change cannot easily be dismissed after reading this summary. If climate change is our fault, then the next question becomes, “what if anything should we or can we do about it”?
The impacts to the world wide human and animal communities predicted in the IPPCC Assessment are not cheerful. Their predictions do not show a happy ending. And, of course, since everyone agrees that no one can really predict the future, until it’s too late to do anything about, this is where any thought of corrective action and who foots the bill will get bogged down. The resulting gridlock debate will make the US Senate look like a decisive action oriented group of rational, objective and logical thinkers
I think we are all too hung up on taking action to stop Global Climate change. There are many compelling reasons to take actions that will help reduce man’s impact to the climate that have nothing to do with helping to reduce man’s impact to the climate.
For example, driving less, or buying a vehicle with better gas mileage ratings, will save you money in the long run. Driving less gives you more time to do other things that might be more fun than driving. Aside from the climate change issue, gas prices will continue to rise, not because burning gasoline is or isn’t changing the climate, but because the more we use the less there will be and when there is less of something that people want, the price goes up. Throw into this discussion the possibility that our purchase of gasoline supports people that are trying to kill us (terrorists, communists and other “ists”) and you have to ask yourself, “geez, why would I want to use gasoline at all”?
Now gasoline conservation by itself will not solve all climate problems, but it keeps your money in your pocket. So if you have no clue about how to reduce your driving, Google “Reduce your driving”. You’ll find all kinds of ideas.
Next time I’ll get into ways you can cut your home heating fuel use and how to evaluate your options. I’m trying as many of these ideas as I can afford. I want to spend my money on fun things, not on gas and utilities.
Here is the difference. So far no one has been able to cite a documented observation, clear photographic record, or reproducible experiment evaluated by confirming peer reviewed data or evidence on either Big Foot or the Tooth Fairy. A peer group of four year olds might all agree that the tooth fairy does exist, but we should expect a higher degree of professionalism from the scientific community about the issue of Global Climate change.
To that end, a group of scientists have in fact gotten together to look at all of the available data, various studies, some modeling scenarios and a host of other scientific documentation relating to global climate and temperature variations. This data not only covers historic records kept by people, it also includes scientific estimates of historic temperatures, snow and ice levels, based on agreed upon methods of ice core sample research etc.; along with current information.
The results of this work was printed recently in a report called,
An Assessment of the Intergovernmental Panel on Climate Change. This report also included a summary of the findings. This summary, approved in detail at Intergovernmental Panel on Climate Change (IPCC) Plenary XXVII (Valencia, Spain, 12-17 November 2007), “represents the formally agreed upon statement of the IPCC concerning key findings and uncertainties contained in the Working Group contributions to this Fourth Assessment Report” according to their web site introduction.
Everyone that cares about the facts relating to climate change owes it to themselves and the people that may roll their eyes behind their backs when they announce that they do or don’t “believe in global warming”, to read this summary. And, after a winter like we’ve had this year you can just imagine the debate. However, when you look at the numbers and compare studies and ask consistent questions, the facts, according to this Assessment Summary, seem to point to a real change in the temperature of the globe, with shrinking ice and snow fields and rising ocean levels all pointing to unprecedented increases in global temperature.
Then of course the next question would be, “is this a natural change or a man made change?” This same assessment says it is probably a man made change. Now I don’t just mean “probably” like someday I’ll probably have car trouble, I mean that there is a real likely hood based on the evidence that the climate is warming more rapidly now than any natural conditions would predict or explain. The study goes on to say that this trend is consistent with trends in the production of green house gases created by human activity.
Far from being the “hoax” that some headlines flaunt, the issue of climate change cannot easily be dismissed after reading this summary. If climate change is our fault, then the next question becomes, “what if anything should we or can we do about it”?
The impacts to the world wide human and animal communities predicted in the IPPCC Assessment are not cheerful. Their predictions do not show a happy ending. And, of course, since everyone agrees that no one can really predict the future, until it’s too late to do anything about, this is where any thought of corrective action and who foots the bill will get bogged down. The resulting gridlock debate will make the US Senate look like a decisive action oriented group of rational, objective and logical thinkers
I think we are all too hung up on taking action to stop Global Climate change. There are many compelling reasons to take actions that will help reduce man’s impact to the climate that have nothing to do with helping to reduce man’s impact to the climate.
For example, driving less, or buying a vehicle with better gas mileage ratings, will save you money in the long run. Driving less gives you more time to do other things that might be more fun than driving. Aside from the climate change issue, gas prices will continue to rise, not because burning gasoline is or isn’t changing the climate, but because the more we use the less there will be and when there is less of something that people want, the price goes up. Throw into this discussion the possibility that our purchase of gasoline supports people that are trying to kill us (terrorists, communists and other “ists”) and you have to ask yourself, “geez, why would I want to use gasoline at all”?
Now gasoline conservation by itself will not solve all climate problems, but it keeps your money in your pocket. So if you have no clue about how to reduce your driving, Google “Reduce your driving”. You’ll find all kinds of ideas.
Next time I’ll get into ways you can cut your home heating fuel use and how to evaluate your options. I’m trying as many of these ideas as I can afford. I want to spend my money on fun things, not on gas and utilities.
Tuesday, March 11, 2008
Why Environmentalists think Electric Utility Executives are a pain.
Environmentalists view utility executives as part of the cause of global climate change and resource pollution rather than as the defenders of low cost reliable energy that electric utility executives view themselves being. This disconnect between executive’s self image and the environmental community image has several sources. One is the media attention focused on electric utility problems and mistakes. Enron leaps into mind as does the California billing crisis. Unfortunately every mistake from Three Mile Island to Florida’s recent blackout feeds an impression that electric utility executives make important decisions without including the public in their decision making. These media reports have been long on fearful emotions and short on engineering details. It comes down to the idea that people tend to fear what they don’t understand and utility executives have not been at all successful at improving the public’s understanding of the utility business.
The other source of this distrust goes back many years.
In an address to the National Association of Science Writers in New York on September 16, 1954, US Atomic Energy Commission Chairman Lewis L. Strauss was talking about nuclear power and said, "It is not too much to expect that our children will enjoy in their homes electrical energy too cheap to meter; will know of great periodic regional famines in the world only as matters of history; will travel effortlessly over the seas and under them and through the air with a minimum of danger and at great speeds, and will experience a lifespan far longer than ours, as disease yields and man comes to understand what causes him to age. This is the forecast of an age of peace." (N.Y. Times, August 7, 1955)
Now that the future has arrived we all feel cheated since few of these predictions have materialized. The promise of electricity “too cheap to meter” hits especially hard as rate increases nation-wide reminder us of the failure to reach this dream. So, we have to blame someone and who better to blame than people we don’t really understand, electric utility executives.
And of course, electric utility executives encourage a certain amount of persecution simply by the way they conduct business. If they manage an investor owned utility, their allegiance is to stockholders and investors whose primary interest is the biggest return on their investment. If they lead a municipal or member cooperative electric utility, their allegiance is to their diverse constituents. Some constituents believe we must explore alternate energy resources, demand side management and energy conservation while other constituents simply want the cheapest way to keep beer cold and light bulbs working.
While the environmental community buys the whole global climate change scenario, utility executives generally remain skeptical about the role of power generation in climate change.
Al Gore included this quote in his book about the subject that seems to apply here.
“It is difficult to get a man to understand something when his salary depends upon his not understanding it.” Upton Sinclair
Utility Executive are well educated and experienced. They have seen a lot of history and simply don’t buy the premise that mankind is powerful enough to alter the planet’s climate. A common agreement about facts remains a barrier of distrust between utility executives and the environmental community. Many “green” concepts and the load reduction possibilities of energy conservation are also viewed skeptically by utility executives because in their experience customers don’t use these programs, even when they are well advertised and free.
To add to these differences in world view, they tend to over-estimate load growth because it takes so long to get new generation and transmission facilities in place. They feel the only way they can avoid the rolling blackouts of the Northeast several years ago or more recent sustained power outages in southern Florida is to have lots of facilities approved and ready to go.
The rewards for succeeding with energy conservation and demand side management are not equal to the penalties imposed for poor power reliability.
Utility executives refuse to talk about anything but base-load coal generation because when real numbers are compared, they do not see how renewable energy or energy conservation can meet the demands for electricity based on today’s energy use growth trends. Yet, if they stand up and say these things, environmentalists respond with personal attacks and polarizing comments. This only increases the resolve of utility executives to push for business as usual. It forces them to retreat into protective policies that lack transparency.
Balancing the diverse needs and desires of electric utility customers is not for the faint of heart. Yet, from the looks of things today, it is clear that utilities must do a better job of explaining a boring but necessary business to a busy and misinformed public. "We live in a society exquisitely dependent on science and technology, in which hardly anyone knows anything about science and technology." - Carl Sagan
And, this lack of knowledge will continue to haunt utility executives for many years. Their refusal to discuss facts about alternatives because they think it is a waste of time, money and effort will continue to be the primary reason that environmentalists think electric utility executives are a pain in the… you know what.
The other source of this distrust goes back many years.
In an address to the National Association of Science Writers in New York on September 16, 1954, US Atomic Energy Commission Chairman Lewis L. Strauss was talking about nuclear power and said, "It is not too much to expect that our children will enjoy in their homes electrical energy too cheap to meter; will know of great periodic regional famines in the world only as matters of history; will travel effortlessly over the seas and under them and through the air with a minimum of danger and at great speeds, and will experience a lifespan far longer than ours, as disease yields and man comes to understand what causes him to age. This is the forecast of an age of peace." (N.Y. Times, August 7, 1955)
Now that the future has arrived we all feel cheated since few of these predictions have materialized. The promise of electricity “too cheap to meter” hits especially hard as rate increases nation-wide reminder us of the failure to reach this dream. So, we have to blame someone and who better to blame than people we don’t really understand, electric utility executives.
And of course, electric utility executives encourage a certain amount of persecution simply by the way they conduct business. If they manage an investor owned utility, their allegiance is to stockholders and investors whose primary interest is the biggest return on their investment. If they lead a municipal or member cooperative electric utility, their allegiance is to their diverse constituents. Some constituents believe we must explore alternate energy resources, demand side management and energy conservation while other constituents simply want the cheapest way to keep beer cold and light bulbs working.
While the environmental community buys the whole global climate change scenario, utility executives generally remain skeptical about the role of power generation in climate change.
Al Gore included this quote in his book about the subject that seems to apply here.
“It is difficult to get a man to understand something when his salary depends upon his not understanding it.” Upton Sinclair
Utility Executive are well educated and experienced. They have seen a lot of history and simply don’t buy the premise that mankind is powerful enough to alter the planet’s climate. A common agreement about facts remains a barrier of distrust between utility executives and the environmental community. Many “green” concepts and the load reduction possibilities of energy conservation are also viewed skeptically by utility executives because in their experience customers don’t use these programs, even when they are well advertised and free.
To add to these differences in world view, they tend to over-estimate load growth because it takes so long to get new generation and transmission facilities in place. They feel the only way they can avoid the rolling blackouts of the Northeast several years ago or more recent sustained power outages in southern Florida is to have lots of facilities approved and ready to go.
The rewards for succeeding with energy conservation and demand side management are not equal to the penalties imposed for poor power reliability.
Utility executives refuse to talk about anything but base-load coal generation because when real numbers are compared, they do not see how renewable energy or energy conservation can meet the demands for electricity based on today’s energy use growth trends. Yet, if they stand up and say these things, environmentalists respond with personal attacks and polarizing comments. This only increases the resolve of utility executives to push for business as usual. It forces them to retreat into protective policies that lack transparency.
Balancing the diverse needs and desires of electric utility customers is not for the faint of heart. Yet, from the looks of things today, it is clear that utilities must do a better job of explaining a boring but necessary business to a busy and misinformed public. "We live in a society exquisitely dependent on science and technology, in which hardly anyone knows anything about science and technology." - Carl Sagan
And, this lack of knowledge will continue to haunt utility executives for many years. Their refusal to discuss facts about alternatives because they think it is a waste of time, money and effort will continue to be the primary reason that environmentalists think electric utility executives are a pain in the… you know what.
Monday, September 3, 2007
RESIDENTIAL ENERGY TAX CREDITS HELP YOU SAVE ENERGY
If you make certain types of energy efficient improvements to your primary home in 2007, you may be able to apply for tax credits to lower your income tax requirements or increase your income tax return for 2007.
The Energy Policy Act of 2005 and its amendments encourage homeowners and renters to install energy efficient home improvements in three major categories; Residential building envelope improvements; Residential heating system improvements, and; Solar energy system additions.
If you qualify for building envelope improvements, you may be able to take a tax credit of 10% of the cost of your “nonbusiness energy property credit” improvements up to a total of $500. The materials referred to in the IRS general instructions for Form 5695 must be new and permanently installed to last at least five years. These improvements can include insulation materials, exterior windows, exterior doors and storm doors and some metal roofing materials. Labor costs for these improvements eligible for the tax credit.
Heating system improvements or “Residential energy property costs” include certain electric heat pumps, ground source or geothermal heat pumps and other space conditioning equipment. Labor costs are eligible for this tax credit which has the same tax credit eligibility of 10% up to a maximum of $500.
Solar energy tax credits are referred to as the “ Residential Energy Efficient Property Credit”. This credit is limited to 30% of your costs including labor up to a maximum credit of $2,000 for qualifying photovoltaic and solar water heating systems.
This article is not a tax consultant article. To make sure these credits apply to you, talk to your tax consultant, the Internal Revenue Service (IRS), or refer to IRS Form 5695. The Energy Star website also has more information.
Eligible improvements must be in place by December 31, 2007 and meet other requirements to qualify, so make sure you check it out before buying your improvements.
© Mark Daily, 2007
The Energy Policy Act of 2005 and its amendments encourage homeowners and renters to install energy efficient home improvements in three major categories; Residential building envelope improvements; Residential heating system improvements, and; Solar energy system additions.
If you qualify for building envelope improvements, you may be able to take a tax credit of 10% of the cost of your “nonbusiness energy property credit” improvements up to a total of $500. The materials referred to in the IRS general instructions for Form 5695 must be new and permanently installed to last at least five years. These improvements can include insulation materials, exterior windows, exterior doors and storm doors and some metal roofing materials. Labor costs for these improvements eligible for the tax credit.
Heating system improvements or “Residential energy property costs” include certain electric heat pumps, ground source or geothermal heat pumps and other space conditioning equipment. Labor costs are eligible for this tax credit which has the same tax credit eligibility of 10% up to a maximum of $500.
Solar energy tax credits are referred to as the “ Residential Energy Efficient Property Credit”. This credit is limited to 30% of your costs including labor up to a maximum credit of $2,000 for qualifying photovoltaic and solar water heating systems.
This article is not a tax consultant article. To make sure these credits apply to you, talk to your tax consultant, the Internal Revenue Service (IRS), or refer to IRS Form 5695. The Energy Star website also has more information.
Eligible improvements must be in place by December 31, 2007 and meet other requirements to qualify, so make sure you check it out before buying your improvements.
© Mark Daily, 2007
Monday, August 13, 2007
Wind Energy Could Be Mainstream Generation Resource Soon
With over 11,000 megawatts of wind energy on line in the USA and 2,000 of it coming on line in 2006 alone, wind stands to be a major contributor to renewable energy generation.
One of the obstacles to the adoption of wind generation as a major electric energy generation source in the Untied States has been the contention by some in the Utility industry that wind energy must be covered by duplicate dispatchable fixed output generation facilities. This argument has been used to down play the importance and usefulness of wind energy to the growing renewable energy moment. The argument goes like this.
Since the wind can stop blowing at any time, coal or other conventional generation resources must be built simultaneously with wind production facilities, just in case the wind stops blowing. While it maybe true that wind is not as reliable as conventional generation, according to a Utility Wind Integration Group ( UWIG) report entitled, " Utility Wind Generation State of the Art", studies confirm that wind generation can stand alone as a generation source without the requirement for fossil fuel back up.
The anti wind sentiment also dampened the enthusiasm of utility planners to the acceptance of combined cycle gasification technologies and other advance clean coal and clean fossil fuel technologies because they argued that the extra expense of these unproven technologies was not justified if wind generators could kick in any time the wind was blowing hard enough to cover the demand.
While some of you may see a pattern here ( read conspiracy) I think that utilities justifiably and sincerely are concerned about the impact that wind generators might have on a stable energy grid. Restarting a coal fired plant (50% or more of the USA’s generation fuel) is no easy task. Neither is balancing load requirements with available electricity generation facilities. While some may retort that this is not rocket science, I think its pretty close. Keep in mind that terribly expensive things happen to utilities when there is not enough power available to cover the demand from millions of independent homes and businesses. Every kilowatt hour sent to your house or business comes from a system that plans ahead for your equipment to come on even when you haven’t told anyone that you have the equipment.
Utilities have developed suffisticated computer models that use weather forecasts, seasonal business cycle histories and historic residential demand data for the average home in their service area. They are prepared to turn on, ramp up and stoke up generation facilities or turn off, ramp down or slow down every generator in the USA every thirty minutes to an hour, 24 hours a day 365 days per year. Just to keep us in cold beer and toast. Well, I guess it is more than just cold beer and toast.
The UWIG report acknowledges that Wind Generators are a different type of generator but assure planners that wind generation can fit into the existing electricity generation system nationwide, with the proper planning, design and integration.
Electric energy dispatchers rely heavily on weather forecaster’s temperature predictions for scheduling their power delivery. The UWIG report says that weather forecasters are 80% effect at predicting wind speeds and durations. This additional weather data can go a long way towards making wind generators as reliable, predicable and dispatch able as fossil fuel generators.
Recent policy approvals for amendments to the National Energy Policy Act of 2005 lend new support for renewable energy initiatives. This could be the perfect storm that renewable energy needs to get a little help out there. The coal, nuclear and oil industries have subsidies and federal support that has been in place for decades. Now is the time to lend that same support to renewable energy by supporting Renewable Electricity Standards.
Over twenty states including,California, New Mexico, Minnesota, Oregon, and Colorado – have or are implementing Renewable Portfolio Standards of 20 percent or more. Now is the time to take it nation wide.
Have you contacted your legislators to show support for Renewable Energy Standards? I'd like to hear from you one way or the other about this. What are your thoughts on the subject?
© Mark Daily 2007
One of the obstacles to the adoption of wind generation as a major electric energy generation source in the Untied States has been the contention by some in the Utility industry that wind energy must be covered by duplicate dispatchable fixed output generation facilities. This argument has been used to down play the importance and usefulness of wind energy to the growing renewable energy moment. The argument goes like this.
Since the wind can stop blowing at any time, coal or other conventional generation resources must be built simultaneously with wind production facilities, just in case the wind stops blowing. While it maybe true that wind is not as reliable as conventional generation, according to a Utility Wind Integration Group ( UWIG) report entitled, " Utility Wind Generation State of the Art", studies confirm that wind generation can stand alone as a generation source without the requirement for fossil fuel back up.
The anti wind sentiment also dampened the enthusiasm of utility planners to the acceptance of combined cycle gasification technologies and other advance clean coal and clean fossil fuel technologies because they argued that the extra expense of these unproven technologies was not justified if wind generators could kick in any time the wind was blowing hard enough to cover the demand.
While some of you may see a pattern here ( read conspiracy) I think that utilities justifiably and sincerely are concerned about the impact that wind generators might have on a stable energy grid. Restarting a coal fired plant (50% or more of the USA’s generation fuel) is no easy task. Neither is balancing load requirements with available electricity generation facilities. While some may retort that this is not rocket science, I think its pretty close. Keep in mind that terribly expensive things happen to utilities when there is not enough power available to cover the demand from millions of independent homes and businesses. Every kilowatt hour sent to your house or business comes from a system that plans ahead for your equipment to come on even when you haven’t told anyone that you have the equipment.
Utilities have developed suffisticated computer models that use weather forecasts, seasonal business cycle histories and historic residential demand data for the average home in their service area. They are prepared to turn on, ramp up and stoke up generation facilities or turn off, ramp down or slow down every generator in the USA every thirty minutes to an hour, 24 hours a day 365 days per year. Just to keep us in cold beer and toast. Well, I guess it is more than just cold beer and toast.
The UWIG report acknowledges that Wind Generators are a different type of generator but assure planners that wind generation can fit into the existing electricity generation system nationwide, with the proper planning, design and integration.
Electric energy dispatchers rely heavily on weather forecaster’s temperature predictions for scheduling their power delivery. The UWIG report says that weather forecasters are 80% effect at predicting wind speeds and durations. This additional weather data can go a long way towards making wind generators as reliable, predicable and dispatch able as fossil fuel generators.
Recent policy approvals for amendments to the National Energy Policy Act of 2005 lend new support for renewable energy initiatives. This could be the perfect storm that renewable energy needs to get a little help out there. The coal, nuclear and oil industries have subsidies and federal support that has been in place for decades. Now is the time to lend that same support to renewable energy by supporting Renewable Electricity Standards.
Over twenty states including,California, New Mexico, Minnesota, Oregon, and Colorado – have or are implementing Renewable Portfolio Standards of 20 percent or more. Now is the time to take it nation wide.
Have you contacted your legislators to show support for Renewable Energy Standards? I'd like to hear from you one way or the other about this. What are your thoughts on the subject?
© Mark Daily 2007
Friday, March 9, 2007
Is Your Electricity Subsidized?
While the term "subsidy" has taken on derogatory implications, the fact is that in spite of our so called free market economy, most of the things we buy, including electricity have some financial help from Uncle Sam. It may be a simple adjustment in federal taxes or tax credits available for certain industries, it may be federal funding of research and development, it maybe discounted loan programs. What ever it is, from automobiles to grapefruit, there is something that someone can call a "Subsidy". Investor owned utilities(IOU’s), municipal owned utilities (MUNI’s), and member owned utilities (COOPS) all get subsidized in some way. So, get over it.
The question you should ask is not who gets a subsidy , but rather who benefits from the subsidy and do those subsidies support industries that are good for the long term health of the nation and the World? In the case of electricity generation, they do, if you believe that price is all that matters. Our electric rates nation wide would be higher, maybe much higher, if it were not for the maze of tax incentives and benefits available to those making electricity.
Our collective sense of things is that the big guys, king coal, nuclear power and natural gas get bigger subsidies then the little guys like wind, solar, energy conservation and bio fuels. And, if you thought that, you, would be right. In a year 2000 Federal Report (Number SR/OIAF/2000-02 http://www.eia.doe.gov/oiaf/servicerpt/subsidy1/index.html ); the numbers show that in 1999 base load generation from fossil fuels was supported 2.2 times more than energy conservation and 15.35 times more than renewable technologies.
According to the executive summary of the 2000 report, "Federal subsidies for transformation and end-use activities are estimated to be $2.2 billion in fiscal year 1999, a decline of about 10 percent in real terms from the total found for similar items in fiscal year 1992 (Table ES1 and Figure ES1).execsummary_fnotes.htmlIt is estimated that direct subsidies--the sum of direct expenditures and tax expenditures--totaled $1.8 billion in fiscal year 1999, of which direct expenditures totaled $1.4 billion. R&D subsidies accounted for the remainder, just over $0.45 billion."
The 2005 Energy Act promises to promote energy conservation and renewables, yet so far the amount of support and subsidy still weighs in heavier for coal(big emphasis on clean coal technologies) and nuclear energy than it does for conservation and renewables.
Meeting the electric energy needs of this nation will require subsidies on a more even playing field that will help fledgling industries compete against the old timers decades of federal support. Clean coal, safe nuclear generation, hydro- electric production, and renewables must all be evaluated for the contribution that they can make to meet the needs without creating long lasting environmental programs. But, this wont be cheap.
Residential electricity rates across the nation have increased faster than the Consumer Price Index for many years.
Consumer Price Index Increase - All Urban Areas
2003 -1.9%
2004 -3.3%
2005 - 3.4%
2006 - 2.5%
Four Year Annual Avg
2.8%
US Department of Labor Statistics ftp://ftp.bls.gov/pub/special.requests/cpi/cpiai.txt
Average Retail Price of Electricity to Consumer
Year Cents/kWh Percent increase
2003 8.72 3.32%
2004 8.98 2.98%
2005 9.46 5.35%
2006 10.46 10.57%
Four Year Annual Avg.
5.55%
Source: Energy Information Administration http://www.eia.doe.gov/cneaf/electricity/epa/epat7p4.html#_ftn2
Get used to rising rates. There is no way we can move into an era of less dependence on fossil fuels without paying more at the meter.
Recent claims of victory by environmental groups over the apparent retreat of TXU investors over plans to build 11 new coal generation facilities, could be hollow chest thumping, if other generation sources don’t surface to meet the need. Sure, TXU may have over-estimated load growth, just to look like good guys when they agreed to stop plans for 8 coal plants, but some day load will exceed supply if current trends continue.
Changing the paltry contribution of renewables to the nation’s generation fuel mix will take a lot more than chasing off coal plant investors.
The question you should ask is not who gets a subsidy , but rather who benefits from the subsidy and do those subsidies support industries that are good for the long term health of the nation and the World? In the case of electricity generation, they do, if you believe that price is all that matters. Our electric rates nation wide would be higher, maybe much higher, if it were not for the maze of tax incentives and benefits available to those making electricity.
Our collective sense of things is that the big guys, king coal, nuclear power and natural gas get bigger subsidies then the little guys like wind, solar, energy conservation and bio fuels. And, if you thought that, you, would be right. In a year 2000 Federal Report (Number SR/OIAF/2000-02 http://www.eia.doe.gov/oiaf/servicerpt/subsidy1/index.html ); the numbers show that in 1999 base load generation from fossil fuels was supported 2.2 times more than energy conservation and 15.35 times more than renewable technologies.
According to the executive summary of the 2000 report, "Federal subsidies for transformation and end-use activities are estimated to be $2.2 billion in fiscal year 1999, a decline of about 10 percent in real terms from the total found for similar items in fiscal year 1992 (Table ES1 and Figure ES1).execsummary_fnotes.htmlIt is estimated that direct subsidies--the sum of direct expenditures and tax expenditures--totaled $1.8 billion in fiscal year 1999, of which direct expenditures totaled $1.4 billion. R&D subsidies accounted for the remainder, just over $0.45 billion."
The 2005 Energy Act promises to promote energy conservation and renewables, yet so far the amount of support and subsidy still weighs in heavier for coal(big emphasis on clean coal technologies) and nuclear energy than it does for conservation and renewables.
Meeting the electric energy needs of this nation will require subsidies on a more even playing field that will help fledgling industries compete against the old timers decades of federal support. Clean coal, safe nuclear generation, hydro- electric production, and renewables must all be evaluated for the contribution that they can make to meet the needs without creating long lasting environmental programs. But, this wont be cheap.
Residential electricity rates across the nation have increased faster than the Consumer Price Index for many years.
Consumer Price Index Increase - All Urban Areas
2003 -1.9%
2004 -3.3%
2005 - 3.4%
2006 - 2.5%
Four Year Annual Avg
2.8%
US Department of Labor Statistics ftp://ftp.bls.gov/pub/special.requests/cpi/cpiai.txt
Average Retail Price of Electricity to Consumer
Year Cents/kWh Percent increase
2003 8.72 3.32%
2004 8.98 2.98%
2005 9.46 5.35%
2006 10.46 10.57%
Four Year Annual Avg.
5.55%
Source: Energy Information Administration http://www.eia.doe.gov/cneaf/electricity/epa/epat7p4.html#_ftn2
Get used to rising rates. There is no way we can move into an era of less dependence on fossil fuels without paying more at the meter.
Recent claims of victory by environmental groups over the apparent retreat of TXU investors over plans to build 11 new coal generation facilities, could be hollow chest thumping, if other generation sources don’t surface to meet the need. Sure, TXU may have over-estimated load growth, just to look like good guys when they agreed to stop plans for 8 coal plants, but some day load will exceed supply if current trends continue.
Changing the paltry contribution of renewables to the nation’s generation fuel mix will take a lot more than chasing off coal plant investors.
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