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I'd love to see us start building energy efficient homes. A bit more up front investment would give huge returns.

jjav 6y ago
A problem is that conserving doesn't in the end produce any cost savings, which is a perverse disincentive to conserve. Water during the CA droughts a few years ago is a perfect example. Water agencies asked people to conserve water. So people did. A lot. Water agencies promptly freaked out because their revenue decreased. Of course it did, people were conserving water. So they increased the base rates (the amount they'll bill you even if consumption is zero) to compensate (and then some). In my town, base rate went from a few dollars to almost $80. So even though my consumption went down about 20% from my efforts to conserve, my monthly bill went up from around $40 to near $100. So what's my incentive to conserve?
- pmiller2 6y ago
  How about helping to ensure there's a planet worth living on in 20-50 years? Must it always come down to whatever costs the least money now?
  - jjav 6y ago
    Sure, that's a good goal. I spent a lot of effort, time and money to optimize and reduce water consumption as much as possible. Low-flow everything, upgraded appliances, redid the yard and all sprinkler plumbing, all for the idea of conserving water. It is quite a gut punch to then have the water bill increase more than 100% because the water agency is solely focused on how much profit they are making, instead of caring about conservation.
- leoedin 6y ago
  If they increase the unit cost rather than the base rate, then there's still an incentive to conserve. It just means that the people who didn't conserve water initially are now paying more. To get back to the same price they need to conserve water. That's exactly the behaviour we (society) want - overall, water is conserved. Increasing the base rate (making water a fixed cost regardless of usage) has the opposite effect. That was clearly a mistake on the part of the water company.
  - jjav 6y ago
    Exactly! I wish they'd set the base rate to like $1 (just to cover sending the bill) and substantially increase per-gallon cost. That would incentivize conservation. Unfortunately the water agency only cares about the profit they make and could not care less about conservation.
- abandonliberty 6y ago
  Yes, we need to align incentives with conservation/consumption and minimize externalities. Unfortunately, because our buildings are not built by the parties that have to pay for consumption, that's not enough to incentivize energy efficient / green building construction. There's probably some costs that need to be shared including leaky pipes and fire departments that increase in times of heat, but that seems unlikely to account for a tripling. Your water department probably charged that way because there are water hogs that create jobs/food/etc. who wouldn't be able to foot the actual bill of their water use, so while they wanted to incentivize conservation they also wanted everyone to share the bill. This isn't necessarily a bad thing; we're in this together and need money and food.

jjav 6y ago

A problem is that conserving doesn't in the end produce any cost savings, which is a perverse disincentive to conserve. Water during the CA droughts a few years ago is a perfect example. Water agencies asked people to conserve water. So people did. A lot. Water agencies promptly freaked out because their revenue decreased. Of course it did, people were conserving water. So they increased the base rates (the amount they'll bill you even if consumption is zero) to compensate (and then some). In my town, base rate went from a few dollars to almost $80. So even though my consumption went down about 20% from my efforts to conserve, my monthly bill went up from around $40 to near $100. So what's my incentive to conserve?

pmiller2 6y ago
How about helping to ensure there's a planet worth living on in 20-50 years? Must it always come down to whatever costs the least money now?
- jjav 6y ago
  Sure, that's a good goal. I spent a lot of effort, time and money to optimize and reduce water consumption as much as possible. Low-flow everything, upgraded appliances, redid the yard and all sprinkler plumbing, all for the idea of conserving water. It is quite a gut punch to then have the water bill increase more than 100% because the water agency is solely focused on how much profit they are making, instead of caring about conservation.
leoedin 6y ago
If they increase the unit cost rather than the base rate, then there's still an incentive to conserve. It just means that the people who didn't conserve water initially are now paying more. To get back to the same price they need to conserve water. That's exactly the behaviour we (society) want - overall, water is conserved. Increasing the base rate (making water a fixed cost regardless of usage) has the opposite effect. That was clearly a mistake on the part of the water company.
- jjav 6y ago
  Exactly! I wish they'd set the base rate to like $1 (just to cover sending the bill) and substantially increase per-gallon cost. That would incentivize conservation. Unfortunately the water agency only cares about the profit they make and could not care less about conservation.
abandonliberty 6y ago
Yes, we need to align incentives with conservation/consumption and minimize externalities. Unfortunately, because our buildings are not built by the parties that have to pay for consumption, that's not enough to incentivize energy efficient / green building construction. There's probably some costs that need to be shared including leaky pipes and fire departments that increase in times of heat, but that seems unlikely to account for a tripling. Your water department probably charged that way because there are water hogs that create jobs/food/etc. who wouldn't be able to foot the actual bill of their water use, so while they wanted to incentivize conservation they also wanted everyone to share the bill. This isn't necessarily a bad thing; we're in this together and need money and food.