Monday, September 28, 2009

Sheer laziness and intellectual dishonesty is holding back the world

I was once an American. Yes, dear reader, I can state that as a fact. Reason:

1) I looked at my household energy bill for 2004 and ran it through the US energy department calculator at http://www.epa.gov/climatechange/emissions/ind_calculator2.html#c=homeEnergy&p=reduceOnTheRoad&m=calc_currentEmissions. I shoved in 4000 units (that is what it was) and Lo! it was 44,267 pounds (they still use them, therefore so will we). That is horrendously more than the 28,750 that is the average for the US. But we have to make a correction - in the US electricity is not the only source of energy - direct heat from oil or gas is used to heat water and the house. In India, by contrast, a/c's are run from electricity.
2) I added fuel oil as the source of heat to the calculator taking the average American five person home to 50,750 pounds of carbon.
3) To be fair I added the gas used for cooking, 1,460 pounds to my total. I will add this to the US total because their gas numbers are confusing as it is used both for cooking and heating, so it is fairer to use my number.

Total me: 45,727.00 lbs
Total average joe: 52,210 lbs

No real difference.

The new me (see earlier blog), who lives just as well as before, uses just 1500 units = 16,600 lbs of carbon.

That's the laziness - its just too much work to make people change.

And the dishonesty? For amusement I switched in the same calculator to using money as the unit, and not units of electricity. 1500*8.33 (our avg rate in Mumbai)/48=260.31 as the monthly bill. That produces a reading of 27,170 lbs of carbon.

16,600/27,170*8.33=5.09 is the average price of US electricity.

Were they paying 8.33 the cost per month per family would rise from US 175 (average)to 8.33/5.09*175=286 USD per month or 1,332 per year. That is 2.66% of median US pretax household income. Would a change in electricity price change behaviour?

Yes it would, and drastically, when one takes as a proxy the change to driving and car buying habits that took place when petrol went from 2.00 to 4.00. Assuming 20 miles to gallon as an average the hit to a two car household putting 25K miles on the clock was about 2,500 per year.

Conclusion: Electricity induced carbon is seriously mispriced in the US versus Mumbai. Wildly mispriced if one takes into account purchasing power parity.

Of course it is even more mispriced in Mumbai versus the free power that farmers get in the Punjab.

That is just household use; in car use I remain firmly American when in India because of the lack of public transport and the lack of pavements on which to walk.

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