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This blog combines articles from ADEC ESG Solutions, as well as FirstCarbon Solutions (FCS), an ADEC Innovation.

Improving Energy Management: Do We Need Higher Electricity Prices?

Posted by Sharolyn Vettese on Jan 25, 2013 8:00:00 AM

Nobody likes to see price increases, especially in times of low inflation, but it is a good thing for electricity rates. In fact, it may even be a necessity if you are living in Canada or the United States and want to continue enjoying the conveniences that electricity provides. Higher electricity prices would help pay to modernize the grid, making it more efficient and able to meet the needs of current and future electricity demands.

Demand for electricity keeps on increasing simply because it is so cheap relative to other forms of energy.  It is just human nature to take advantage of good deals, and there's not much of an incentive to conserve things that cost little. Electricity has been working so well for decades that most of us never really bother to understand how it is generated because it has always been available at the flip of a switch.

In Canada and the United States, the grid’s Improving Energy Management: Do We Need Higher Electricity Prices?100 year-old infrastructure that we have today was built at a time of plenty. That means it was overbuilt - allowing it to take on additional demands - but there was no concern about efficiency. However, with new technology today greater efficiency is available. Yes, costly repairs may be made to the grid, but that is like repairing an old car that has no value anymore. The repair bills keep on adding up, but you’re still going to end up with an old car that doesn’t meet your needs. If the existing grid doesn’t meet your needs for today, it certainly won’t meet your needs for the next 50 years. We don’t want to be in a position where there is a breakdown due to malfunction, extreme weather conditions, or sabotage, and everything stops because we have no electricity. This scenario is the ideal reason to implement a major overhaul of the grid to modernize it to meet current needs, and also for the electricity needs for the next 50 years.

So, if electricity is a vital component of our modern civilization, then we should want to pay higher electricity rates so that the grid can be modernized to be more efficient, more responsive, decentralized (less vulnerable to natural or terrorist acts), and to include distributed renewable energy generators like Wind Simplicity’s Windancer™ small wind turbines. The replacement of the old grid with the smart grid will take years, so renewable energy generators can ease the replacement transition. Having renewables like Wind Simplicity’s Windancer™ on-site for on-site electricity consumption reduces the demand on the grid. It has the same effect as conservation, and it also means you have insurance against rising electricity rates.

Higher electricity prices encourage conservation, and it also helps nurture the renewables industry. The sooner the price of electricity goes up, the longer we can enjoy the conveniences that electricity provides.   Superstorm Hurricane Sandy showed how vulnerable the existing centralized infrastructure is, and climatologists say that this is "the new normal." So, now is also a good time to start a discussion to look at electricity generation in a new light. 

FirstCarbon Solutions is a leader in energy management consulting. If you wish to find out more information about how to use energy more efficiently, click the link below.

 

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Did you enjoy this post? The author of this article is Sharolyn Vettese. Learn more about her here.