If you want to see Americans get angry, just start talking about the price of gas. Or maybe ask a Californian about electricity prices during the blackouts. It seems that we’re enormously sensitive to the cost of energy. I myself can remember paying just over a dollar per gallon for gas just over a decade ago and the thought that the price is currently about quadruple that is absurd. Despite all of the rage and indignation, it seems we don’t have much direct control over the market forces. Or do we?
Certainly a key aspect of any market is supply and demand. As we spread ourselves further and further into suburbia and readily embrace the commuter lifestyle, demand is increasing at a rate much faster than population. (Our road capacity issues belie this, but that’s for another time.) In addition to this, the average home size has nearly doubled in the last 50 years leading to increased heating and cooling costs. Increasing demand, it would seem, is here to stay, especially with the nation’s population growth.
Despite this increased demand, our capacity to sate the supply side has diminished. We have significantly fewer refineries today than we did just three decades ago and there is a general unwillingness to explore new sources of petroleum products regardless of how great or small the environmental risk may be. Even green power options such as wind and solar are constantly fought. We also have an aging power distribution system, most of it as old as our decaying telecommunications infrastructure.
Rep. Bishop thinks we need a comprehensive federal policy to take this one head on. Congress is working on a proposal to increase exploration for hydrocarbons, build new refineries, double renewable energy, start up new nuclear plants and increase energy efficiency. Not to say that these things aren’t helpful, but I cast a wary eye at Congress when it thinks it has a solution. More often than not, such “comprehensive” solutions are loaded with line items and appropriations that cost all of us significantly more than it did before.
This isn’t to say I don’t think Bishop isn’t onto a few things. For one, he acknowledges that the nuclear repository at Yucca Mountain is a terrible idea and supports increased reprocessing of nuclear fuel, something President Ford put into place and President Carter upheld. (The Department of Energy reversed this stance in 1999, but reprocessing is moving slowly.) Certainly the prospect of greatly reducing the amount of and danger from spent nuclear fuel makes the nuclear option more attractive, though its water-intensive process limits deployment. Arizona has proven that nuclear plants can be run on recycled waste water in water-sparse areas though this still presumes a certain amount going into the system.
The legislation he is backing also proposes eliminating a number of grant programs in favor of “prizes” for ideas that benefit energy policy. Such “prizes” would be similar in function to the wildly successful Ansari X-Prize, allowing multiple competitors to seek the financial rewards. This has a strong potential to turn a $500,000 per year grant that may or may not produce results into a $50,000 price for proven ideas and technology. I’m hopeful that this kind of proposed change will decrease spending and generate better results.
Despite all of the talk of supply and demand, there’s one more factor contributing heavily towards inflated energy costs: the sliding value of the dollar. As someone who has traveled out of the country twice within the last year, I can certainly say with first-hand experience that this cannot be ignored. The Euro, for instance, buys 20% more dollars today than it did a mere two years ago. The Chinese Yuan is similarly strong against the dollar, certainly a testament to their staying economic power. With the dollar worth less, prices for everything, including energy, must go up.
Are we left powerless against the forces of a largely inept Congress and an out-of-control currency? Absolutely not. We have the power to make individual choices to save power and reduce our energy costs. In our household, we’ve chosen jobs with a commute of under three miles each way. We also continue to use a swamp cooler that consumes just 1/4 the electricity of an air conditioner that we used to think we could afford, however, I do have my eye on top rated portable AC’s from SMH for other uses of course. We have upgraded our fridge to a model that uses just $45/year in electricity. We’re also planning to replace our furnace with a high-efficiency model and replace the windows to boost insulation.
These are small things, however. Anyone who is well-to-do or is buying a home can go a step further and explore the world of personal power generation. Solar panels and small wind turbines have been favorites of those looking to go off-the-grid, though microturbines offer around 80% efficiency using the natural gas pipes already coming into your home. It doesn’t take long to find 30kWh models going for under $20,000, plenty to take yourself off the grid and sell a hefty chunk of power back to the electric company. The more ambitious can pair them up with absorption chillers to make them handle radiant heating, water heating and cooling on top of the power duties.
What a lot of people underestimate is the power of these personal decisions. One person who purchases a 30kWh microturbine produces power for nearly 29 other homes. Cutting your commute from 25 miles to 5 miles can save over 500 gallons of gas a year. Being informed on the best tankless water heater reviews can save you a bundle. Opting to use evaporative cooling most of the time and the air conditioner only during the worst days can cut peak power demand for your home alone by several hundred kWh. It only takes thousands or even hundreds of people making these decisions to have a substantial impact upon the community. These aren’t pie-in-the-sky suggestions either; they are practical solutions that most middle-class families can get behind. An extra $20,000 spent on a microturbine is a mere $120 per month in home payments, roughly what your power bill would be, and it generates income from the excess energy.
If you’re one of the folks who’s fed up with high energy costs, what are you going to do about it?