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benefits of electricity are generally priced in The societal benefits of cheap electricity are no more "priced in" than the negative environmental externalitie

by crusso 14y ago

benefits of electricity are generally priced in The societal benefits of cheap electricity are no more "priced in" than the negative environmental externalities of coal use. You can't put a benefits dollar value to society on all the women in the work force who would otherwise be preparing a lot more meals from scratch. You can't put a benefits dollar value to society on the productivity gains from all the people who would have died of childhood diseases that we have cures for thanks to western medicine. You're obviously in favor of accounting for one factor in the cost/benefit analysis of coal power and ignoring the others. I think it's hubris and folly to do so.

rayiner 14y ago
The exercise here is accounting for costs and benefits external to the power producer/consumer transaction. Any costs and benefits arising from the transaction are factored into the price of electricity. If electricity allows women to participate in the work force instead of making meals from scratch, that presumably increases demand for electricity, which affects the price. In theory, the benefits that stem from people having electrical service should be reflected in the price of that service. Accounting for externalized costs is a wholly different exercise. It's an accounting of the costs that do not arise out of the producer/consumer transaction and thus cannot affect the price of electricity through bargaining. Health costs of coal are one such cost. People bear that cost whether or not they even have electric service, and their level of usage does not affect the level of the costs they incur. This kind of cost is not priced into the price of electricity from coal. The benefit that would be relevant in this accounting is a benefit from electricity that you get whether or not you directly or indirectly pay for electricity. Your wife being able to work is not such a benefit--you only get that benefit if you pay for electricity. Note the wiggle word both you and the poster above use: "cheap electricity" not just "electricity." It's not "electricity versus no electricity" its "cheap electricity versus more expensive electricity." The benefits from cheaper versus more expensive electricity are entirely internal to the producer/consumer relationship an are thus priced in to the price of electricity. They're not the same as external environmental costs which are not priced in to the price of electricity.
- crusso 14y ago
  People bear that cost whether or not they even have electric service Just like a child cured by Western medicine gets the benefit without having to necessarily be a consumer of electricity. When I mentioned women in the work force as a benefit, I didn't mean to the individual. I was talking about the societal advantage to having a more productive work force. That is not factored into the purchase of a KWh of electricity. No, "cheap electricity" aren't wiggle words that describe an internal relationship. Cheap electricity was a necessary condition for the cascade of advancements we've made over the last 60 years. In this thread, I've seen the argument, "If only we had charged for externalities from the beginning of electrical generation" - as though we would be where we are today in all other areas of Western life if we had stalled the production of CHEAP electricity for 80 years while we waited to develop alternatives that were themselves predicated upon the cheap electricity we got from coal in the first place.
  - rayiner 14y ago
    > I was talking about the societal advantage to having a more productive work force. That is not factored into the purchase of a KWh of electricity. But it is. If society as a whole benefits more from electricity, their demand goes up, which raises the price of electricity. You're just trying to double-count the benefit. > as though we would be where we are today in all other areas of Western life if we had stalled the production of CHEAP electricity for 80 years while we waited to develop alternatives that were themselves predicated upon the cheap electricity we got from coal in the first place. The situation isn't banning the use of coal from the beginning. It's forcing the external costs of coal to be accounted for from the beginning. Economic theory tells us that this wouldn't have stalled our development.
    - crusso 14y ago
      their demand goes up, which raises the price of electricity If that were true, then electricity should be astonishingly expensive because we use astonishingly more of it than we did 60 years ago, yet the last time I looked, inflation adjusted prices for electricity were remarkably flat. Economic theory tells us that this wouldn't have stalled our development What economic theory is that? Plus, if you want to compare Economic theory vs History; I'll take History. History is filled with discoveries and technology advancements that were the results of cascading advances which were the result of an advancement that made due to some basic resource becoming available and/or cheap. Advances are in no way inevitable. Advances are in no way unhindered by prices of resources. Really what we did early on was to trade our environmental resources for cheap power. From that tradeoff, we have reaped extraordinary benefits. Why are those benefits so hard to recognize in this discussion?

by crusso 14y ago

rayiner 14y ago

The exercise here is accounting for costs and benefits external to the power producer/consumer transaction. Any costs and benefits arising from the transaction are factored into the price of electricity. If electricity allows women to participate in the work force instead of making meals from scratch, that presumably increases demand for electricity, which affects the price. In theory, the benefits that stem from people having electrical service should be reflected in the price of that service. Accounting for externalized costs is a wholly different exercise. It's an accounting of the costs that do not arise out of the producer/consumer transaction and thus cannot affect the price of electricity through bargaining. Health costs of coal are one such cost. People bear that cost whether or not they even have electric service, and their level of usage does not affect the level of the costs they incur. This kind of cost is not priced into the price of electricity from coal. The benefit that would be relevant in this accounting is a benefit from electricity that you get whether or not you directly or indirectly pay for electricity. Your wife being able to work is not such a benefit--you only get that benefit if you pay for electricity. Note the wiggle word both you and the poster above use: "cheap electricity" not just "electricity." It's not "electricity versus no electricity" its "cheap electricity versus more expensive electricity." The benefits from cheaper versus more expensive electricity are entirely internal to the producer/consumer relationship an are thus priced in to the price of electricity. They're not the same as external environmental costs which are not priced in to the price of electricity.

crusso 14y ago
People bear that cost whether or not they even have electric service Just like a child cured by Western medicine gets the benefit without having to necessarily be a consumer of electricity. When I mentioned women in the work force as a benefit, I didn't mean to the individual. I was talking about the societal advantage to having a more productive work force. That is not factored into the purchase of a KWh of electricity. No, "cheap electricity" aren't wiggle words that describe an internal relationship. Cheap electricity was a necessary condition for the cascade of advancements we've made over the last 60 years. In this thread, I've seen the argument, "If only we had charged for externalities from the beginning of electrical generation" - as though we would be where we are today in all other areas of Western life if we had stalled the production of CHEAP electricity for 80 years while we waited to develop alternatives that were themselves predicated upon the cheap electricity we got from coal in the first place.
- rayiner 14y ago
  > I was talking about the societal advantage to having a more productive work force. That is not factored into the purchase of a KWh of electricity. But it is. If society as a whole benefits more from electricity, their demand goes up, which raises the price of electricity. You're just trying to double-count the benefit. > as though we would be where we are today in all other areas of Western life if we had stalled the production of CHEAP electricity for 80 years while we waited to develop alternatives that were themselves predicated upon the cheap electricity we got from coal in the first place. The situation isn't banning the use of coal from the beginning. It's forcing the external costs of coal to be accounted for from the beginning. Economic theory tells us that this wouldn't have stalled our development.
  - crusso 14y ago
    their demand goes up, which raises the price of electricity If that were true, then electricity should be astonishingly expensive because we use astonishingly more of it than we did 60 years ago, yet the last time I looked, inflation adjusted prices for electricity were remarkably flat. Economic theory tells us that this wouldn't have stalled our development What economic theory is that? Plus, if you want to compare Economic theory vs History; I'll take History. History is filled with discoveries and technology advancements that were the results of cascading advances which were the result of an advancement that made due to some basic resource becoming available and/or cheap. Advances are in no way inevitable. Advances are in no way unhindered by prices of resources. Really what we did early on was to trade our environmental resources for cheap power. From that tradeoff, we have reaped extraordinary benefits. Why are those benefits so hard to recognize in this discussion?