Tuesday, September 10, 2013

Incentives and electricity use

Here's an interesting (and short) article from the WP regarding electricity use and incentives. Obviously it's a complicated issue, but interesting in that both producer and consumer face incentives to reduce electricity.

Here is a short video describing an incentive to reduce energy use from Duke Progress. $25/year isn't much of an incentive, but I just signed our house up to check it out.

With regard to the article, what are the incentives for the producers? What are the incentives for consumers?

With regard to the Duke incentive, why are they doing this?

Other than reducing your power bill, what are some other examples of economic incentives to reduce electricity use?

11 comments:

Dr. Peter Schuhmann said...

Here's an interesting piece on incentives and EVs:

http://www.electricforum.com/electric-cars/would-you-still-buy-an-ev-with-no-tax-incentives.html

I wish that the author had included references/data for some of the assertions.

Nick said...

About Californians using less electricity: I wonder if it has anything to do with the larger Hispanic population? Because, over all, they are known to use much less electricity than the average American. Just a thought.
-Nick

Nick McLoota said...

Also, the Duke energyWise program is used to save on energy, energy costs, and to cause less harm to the environment. Other examples of economic incentives to reduce electricity use could be the $25 Duke energyWise incentive, and if you don't use your AC as much, you won't have to fix it and buy new filters and things as soon, and you won't need to buy as many lightbulbs if you keep them off as much as possible.

JM said...

With regard to the article, the incentives for producers include decoupling: producers do not get paid based on how many units of the resource (numbers of electrons in this case) they sell. Therefore increasing the number of electrons sold is not their main goal anymore, which lowers electricity production/consumption. Incentives for consumers include high electricity prices, forcing people to consume less.
There is a point stated by Levinson concerning California's climate that I don't understand. If people are moving to the South and West because the weather is warmer there, increasing the use of A/C, how can this match with the lower consumption of electricity in California? If there is more people in California and those people are increasing their use of A/C, electricity consumption should be higher in California compared to the rest of the U.S.
Concerning other examples of economic incentives to reduce electricity use, would the hour change in time in the winter and spring be an indirect incentive to reduce electricity consumption? Indirect because people do not actively reduce their electricity consumption. Could subsidies from government given to persons using solar panels could be an example as well?
Also, is Duke Energy getting subsidies from the government based on the number of members involved in their program?

Dr. Peter Schuhmann said...

I think he says that people in California are not increasing their electricity use, but they are in other areas of the nation (people moving south, bigger houses, fewer people per house).

Good point about daylight savings time... the purpose is indeed to reduce energy consumption.

Yes, subsidies for "green building" and renewable resource use are indeed incentives to reduce energy consumption.

Duke Energy has a big incentive to keep demand down during peak periods... Hint, it is mentioned in the beginning of the video.

Zoƫ said...

This article got me thinking about this video that I saw earlier at an environmental film festival UNCW Film Studies put on last year ... It's actually a commercial for a book called "The Conundrum" by David Owen, but I found it very interesting:

http://www.youtube.com/watch?v=2S1mPOWRsSc

It talks about how all our recent gains in efficiency (better lightbulbs, more efficient heaters, etc.) don't matter that much because all of this increase efficiency results in higher usage, so in the end the amount of energy and electricity used just increases anyway.

Maybe this goes along with the migration the article is talking about. We are moving to hotter places in the South and West that we couldn't previously inhabit. Since there are more efficient ways to produce energy, we don't feel bad using more of it. Instead of staying together in one home, we spread out. Although the costs are manageable to each individual consumer, overall energy use increases.

Its interesting how California seems to be the outlier that isn't following any of these other trends - household size has stayed the same, residents take advantage of a better climate. Perhaps energy conservation isn't best solved by technological developments or increased efficiency standards, but is better approached by shaping societal norms and cultural practices?

Melissa Pruitt said...

California as a state is one or probably the most "green" state in the U.S. They are known for their legislation for sustainability and conservation and for their incentive programs. California initiated many of the "green" programs and legislation that is now used commonly across the U.S. or that many states are trying to implement. For example, the way many Californians are using less electricity than the average American is probably because the legislation they have implemented as well as talking up living a "green" lifestyle. I also think it helps that CA has some of the highest electricity prices in the country, which in turn makes their residents want to use less. I think CA is a state to emulate, they have made the transititon to being a more "green" and eco-friendly state and I believe more states should be trying to do the same.
With that said, I think it's amazing that Duke Energy is starting the energy wise home program. I think a good deal of people will be receptive of this mainly because of the incentive that they'd get $25 off their power bill per year. Thinking about the long run and how much you could be saving each year would be worth it in the long run. This program is a great step in the right direction to become a more sustainable state.

Questions:
Do you think the $25 off the power bill per year is enough of an incentive though? (I'm not quite sure the cost of an average power bill and if that $25 even makes a difference.)

Do you think Duke Energy will have a cap on how much you can save? Will they top you off at say $200 and not let you gain any more money off your bill or will they let you earn money off each year you are still with them?

Are the devices that will be put on the air conditioner compatible with every AC unit or not?

Diana Ruiz said...

This incentive is interesting. I believe people will be less likely to buy into a $25 incentive because it seems a little low per year. However, for some folks $25 makes a difference. Joining the program is free, there's no installation cost so why not try? I am curious to find out, in terms of quantity, how much electricity each household would reduce under the program.

Jodi-Ann Petrie said...

What was shocking to me is the fact that it was free. There a number of benefits in enrolling in the program as you get to save $25 each year while still playing a part in protecting the environment and that is $25 extra that one could put aside for discretionary income yearly.

Celina Roach said...
This comment has been removed by the author.
Celina Roach said...

This is indeed interesting especially knowing that California is home to many celebrities and still the low electricity costs despite many of their lavish lifestyles. It would be good to conduct a survey to confirm or deny the findings of the research.