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My Electric Bill: Why I Pay More

This article was written by in Consumer. 15 comments.


I asked a few weeks back whether any of you had changed your spending behaviors based on our current recession. Some of you had cut back, while others underscored the importance of always living frugally, so no recession-time cutbacks are necessary.

I, too, choose to live frugally. But sometimes, I also choose to pay more.

In fact, on Halloween Day 2006, I officially made the decision to pay more for my electricity. 1.3 cents per kilowatt hour more, in fact, which generally means an extra $11 to $16 per month for me, based on recent history.

Clean Power Choice
On that date, I signed up with New Wind Energy, which offers nationwide green energy programs. They participate in the NJ Clean Power Choice program, where these charges are directly added to my monthly utility bill.

It’s a set-it-and-forget-it approach to green power, allowing me to support my chosen provider without the installation or hassle of new lines, etc. New Wind Energy is just one of lots of providers available throughout the country, which allowed me to choose the type(s) of power I desired.

I filled out a basic form, and about a month later I was being charged the difference in power cost, paying the delivery fees to my local utility while my supply payment is redirected to support wind power. The electricity I buy is supplied to the grid, even though it isn’t technically going straight to my house. My favorite analogy here is of adding clean water to a a bathtub of dirty water. The water’s not going to become crystal clear right away, but it will gradually become cleaner.

windturbine.jpgMy money helps to build more wind turbines, the most cost-effective renewable energy technology in the world. You can read more about wind energy here, but one of the biggest benefits is the reduction of greenhouse gases, as wind power creates no emissions. The more of this type of power coming into the grid, the better, and I’m happy to help tip the balance.

Renewable Energy Certificates
The Clean Power Choice Program is somewhat more straightforward than RECs (renewable energy certificates), another option for greening your power. There’s a lot to discuss about RECs, but they work much like carbon offsets — you’re purchasing your equivalent electricity usage in green power. Even if your state offers no power choice programs, you can still go online and buy your allottment of RECs.

Wikipedia provides some great background on RECs:

Because nuclear and fossil fuel power are subsidized and their full costs are not built into the price charged, they are cheaper than most renewable sources. The wholesale price for electricity is determined by non-renewable sources and is often less than the cost of producing it through cleaner renewable methods. This is due partially to government subsidies for the nonrenewable energy industry, and partially to a market structure that does not fully capture all social and environmental costs associated with conventional electricity generation (like air pollution, costs to maintain the military in oil-rich parts of the world, disposal costs for nuclear waste, health impacts of dirty generation, etc.) A REC represents an additional payment for producing power from renewable resources, allowing the producer to generate and sell electricity at the local market price and thus enabling more clean renewable energy to be made.

Going Solar
I had been actively pursuing solar panel installation for my house, but the contractor explained I’d have to cut down a giant 50-year-old tree I adore, plus the cost, while well-subsidized, still was nearly $20,000. That’s a lot for a little ranch house like mine, plus I don’t plan to live here for more than another 5 years, so it may not pay to do it. A system only goes about 15 years before needing repairs, another consideration. I am hoping that further subsidies for solar installation will become available in the future and will see what I can do on that front as well.

My Choice
Faced with all of these options, I took the easy route to clean energy for my home with the Clean Power Choice program, and I’ve never regretted it, even as fuel and utility costs continue to rise.

But why? Simply said, I believe that my power as a consumer is one of the strongest powers I have, possibly more impactful than the US voting process, though of course I still plan to exercise my right to vote.

But with my dollars, I’m voting every day, sanctioning the business practices of the companies my money supports, regardless of my intentions. I’ve been this way for a long time, but only recently learned the name for my particular condition: ethical consumerism. (More on that in a future entry.)

For most of my young life, bargains were paramount, and I continually made choices based on the best price or best customer experience. Now I see my purchasing power as directly shaping the world in which I live, and I’m making very different choices.

I am well aware that the environmental impact of our present fuel consumption is a humongous spectre, of such massive scale that it seems impossible to combat it. I’ll confess that I do have a relatively apocalyptic vision of our planet’s future. However dismal the outlook may seem, I’m a person of action, and over the last few years, I’ve seen the scales start to tip in positive ways from an aggregate of what are really minor lifestyle changes. It’s encouraging.

I willingly pay more for electricity so that I can be using and contributing to the kind of power I believe in: clean, green power.

I pay more as an investment, so that over time these technologies will become better and more affordable. In fact, according to a recent article in BusinessWeek, it’s happening already.

So I pack a few lunches a month to cover the extra expense. To me, it’s worth it.

Green Power Provider Locator [EPA.gov]
Wind Energy Basics [National Renewable Energy Laboratory]
Clean Energy: It’s Getting Affordable [BusinessWeek]

Image Credit: Phault

Updated June 20, 2014 and originally published April 8, 2008. If you enjoyed this article, subscribe to the RSS feed or receive daily emails. Follow @ConsumerismComm on Twitter and visit our Facebook page for more updates.

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About the author

Along with her partner, Sasha owns and manage six residential rental units. Sasha endeavors to support the causes and organizations she believes in through more conscientious spending practices. View all articles by .

{ 15 comments… read them below or add one }

avatar Kyle

Bravo for you. As far as I know, my electric utility doesn’t offer this option, but I’m going to call and ask. $15 per month is nothing compared to the environmental benefits.

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avatar Jesse

There is one main problem with most of the “Clean” energy sources that are provided as alternatives. Most of it comes from wind power which as it turns out, is one of the worst sources of energy. In fact, because it is so difficult to store massive amounts of electricty and because wind power is so inconsistent, it is often augmented by “regular” power, even up to 99% in some areas. So be careful about what you are “really” paying for.

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avatar Ken

I am interested in saving energy and generating my own much more than paying extra to participate in a clean power program.

I live in Texas, which I believe gets about 3% of its power from wind. I also believe I read recently that this is more than any other state, and turbine deployment is also growing at a faster rate than any other state. In about 10 years we are estimated to get 15% of our power from wind. Several utilities offer programs similar to the clean power program you mention. You pay extra to get only some of your power from wind.

I do not participate in that program because I feel it’s kinda shady. How do I really know that any of my power came from a wind turbine? It is all blended together, isn’t it? Furthermore, I don’t believe any program (at least in Texas) implies that you’d get all of your power from wind. The impact seems minimal at best and unverifiable.

I choose to buy energy efficient appliances, compact fluorescent bulbs, set my thermostats a bit higher, and use fans. I’m using less energy and saving about $25 per month. That’s verifiable.

The other thing I’m extremely interested in is solar power. Current technology is too expensive and cumbersome, however. My employer is willing to subsidize residential solar systems on top of whatever subsidies the utility or government offers. Using the savings calculator however makes it a non starter. It projects I would have to pay $200 a month for the solar hardware, and it would only save me $40 a month in electricity.

But here comes the nano science. New solar panels are coming to market that claim to lower the cost of a system by an order of magnitude. NanoSolar is one company bringing this to market. there are others as well. I am keeping an eye on this new technology. The panels are less obtrusive, some of them are simply paint that can be sprayed on glass. Cost is much less, and efficiency is as good or better than current technology.

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avatar Stephanie PTY

Kudos to Sasha for doing this!

Ken, the idea is not necessarily to make sure that green energy is pumped to YOUR house, but to (by your payment) get more green energy in the system in general. Sasha’s bathtub analogy explains this pretty well.

Assume that your house is the drain in the bathtub – where the water (energy) comes out. Right now, the water is really dirty. But you can pay to have some clean water dumped in the tub on your behalf, rather than the dirty water you usually pay for.

Now, in this analogy, you have to imagine that the tub has hundreds and hundreds of drains. Will all the clean water you paid for come out of your drain? No, you’ll get water that’s a tiny percent cleaner.

For the final part of this analogy, you have to assume that you have no idea how clean or dirty the water is when it gets to you. You can’t tell the difference when it comes through your drain, so it doesn’t matter to you! All that matters to you is that the water in the tub is a bit cleaner because of your payment.

I hope this makes sense! Every bit of “clean water” helps!

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avatar Boston Gal

I am in the process of having solar panels installed on my home. The cost structure depends on how you shop around for installers, your state rebate program, and the amount of sun your panels will be exposed to. I found a wide discrepency in the cost installers would quote – so if you are serious about getting panels, be sure to get pricing from several installers. You can also do this in stages – have so many panels installed now and then add more later if needed.

If you are already in a home and it is not sited correctly for panels (or you are not willing to increase your output by making modifications – like cutting down a tree) then solar panels likely will not be a good fit. However, if you are thinking of buying a new home in the future, keep solar panels in mind when shopping – look for homes with good southern exposure and think about panels as a possibility.

New Jersey has one of the more generous rebate programs available – I am not sure how much capacity you were looking for to get a price quote of $20,000 – that seems like a lot of KW for a “small ranch” house. My small ranch in Boston will be getting panels and the cost will be less than half your quote – and Massachusetts rebates are not as generous as New Jersey…

So you might have been getter off shopping around for quotes. As for the 15 year repair comment – not sure what panels you looked into getting. Mine have a 20 year warranty guarantee – which I believe is more standard for panel manufacturers.

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avatar Curtis

Sasha, we are looking at doing solar on just our garage (it’s detached and in the alley, currently without electricity). The cost for such small volume isn’t all that bad.

Also, we’ve considered it for our house as well. I ran across renu.citizenre.com that offers solar power at your current electric utility rate, locked in for up to 25 years. They take care of installation, permitting and maintenance of the system, you pay them for power. They are just getting started, but sounds like a GREAT deal. Now if only I could get solar panels mounted gingerly to my 85 year old slate roof!

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avatar Aryn

I like the name Ethical Consumerism. I recently read Robert Reich’s Supercapitalism and he talks a lot about that (without using that name.) It really got me thinking about my choices.

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avatar Sara

You have done a good thing here, in a time when people are so obsessed with saving money you are making a difference to our environment.

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avatar Mrs. Micah

One of my friends in PA backs up his house’s power with a small windmill on top of his house. I have no idea how he did it, but he’s quite handy with that kind of thing. :)

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avatar jim

Nice.

Due to an offer my utility had I am getting 100% wind AND saving money. When I signed up it the cost was about 10% higher than normal service. But they offered to fix the price for 5 year period and guaranteed not to increase the rates. Since I signed up they raised normal rates 6% one time and then 13% another and they’re currently seeking another 8% increase. So I’m already ahead of the game and its fixed for another few years. If anyone else sees an offer from their utility to fix rates for 5 years for a 10% premium then I’d encourage you to take it cause you know utilities love to raise rates.

Jim

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avatar Sasha ♦644 (Dime)

Jesse – E-mail me your references (sasha at this domain name) and I’ll check out what you’re saying about efficiency. From what I’ve read, it’s only getting better. I do think that there are a number of barriers now to clean energy, whether wind, hydro, geothermal, solar, etc. Of course the technologies are expensive and not as efficient as they could be; they’re just starting to really get the funding they should’ve had all along. But that’s what I mean for my investments to change. And even if more efficient, I have a real problem opting for a source of power which is not sustainable. I’d rather seek alternatives than see the day the lights go out for good. We’ve gotten too accustomed to the illusion of endless oil, and it is one of our worst addictions as a country. But I see your point about making sure you’re getting what you pay for, and I so think it’s always a good idea to look into the programs you’re supporting.

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avatar Sasha ♦644 (Dime)

Kyle – So very, very glad to inspire you! Ethical consumerism I’ll do a separate piece on soon, but it’s all about making sure your spending reflects your beliefs, whatever they may be.

Ken – I’ve read some great things about Texas and the shifts in its energy paradigm, especially around Austin. A number of wind energy companies do provide electricity from a blend of cleaner sources. Solar is a great option (what else to do but harness all that sun!) and I too am amazed by all the advances I’ve seen in photovoltaic technology. Your conservative approach to usage is sound regardless of your power source. If you’re interested in solar but worried about cost, you could always start small–they sell small do-at-home kits at sites like Gaiam which could power your electronic devices with minimal setup. It’s a nice savings because those are the sorts of things that sit and leech energy. Also, I saw some extremely cool solar water heating technologies at the Builders Conference in FL a few months back. There were nice savings to be had and systems were inexpensive to set up.

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avatar Sasha ♦644 (Dime)

Boston Gal – I envy your solar pricing. It was a few years ago that I last looked–perhaps it’s time to reexamine. The technology is probably slightly better now too, resulting in better warranties. The tree cutting would bother me, but I am looking at doing a solar water heating system installation–it has a smaller footprint and might let me keep that beautiful tree.

Curtis – I checked out CitizenRe a while back before they’d rolled out their service and meant to check back. I think it’s an awesome business model and was considering trying to roll it out for our rental properties–I have this dream of clean energy rentals, you see.

Mrs. Micah – I know I’ve seen windmill kits online, I think at Gaiam. Aha, found it: http://www.gaiam.com/category/solar-living/wind-power.do Maybe I’ll try my own solar or wind project and post how it goes.

Aryn – I’ll check out that book, and look in the near future for more on the ethical consumerism movement.

Sara and Stephanie – Thanks for your positive feedback!

Jim – what a stroke of luck to lock in a rate in these times!

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avatar Jason Kratz

Sasha-

Kudos. I’m glad to see more people doing these things. Sometimes it is good to pay more for something ;)

I’d appreciate it if you’d post any follow-ups on what “Jesse” is talking about which seems non-sensical to me. There is no more need to store wind power than coal or nuclear power and considering the cost and current backlog of turbines, which are hard to build, I don’t know why any company would put them in areas where they’re going to not be running 99% of the time.

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avatar fathersez

Good for you.

Only yesterday, I called a local company here for quotes on solar lighting for our farm.

They want us to estimate how many bulbs etc, wattage etc, before they can give us a quote. I’ll be submitting this after my next visit this Sunday.

As the farm expands, we’ll be expanding the solar energy capacity.

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