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September/October 2007 Editorial: The Rising Cost of Home Energy

Posted by Alan Meier on September 04, 2007
September/October 2007 Editorial: The Rising Cost of Home Energy
Yes, the price of a subscription to Home Energy is rising. Home Energy is published by a non-profit organization, but our costs are nevertheless inescapably climbing.  You can mitigate the personal impact of the increase by committing yourself to a longer subscription.  You will appreciate that because it means skipping the nuisance of renewing.  We like those longer subscriptions too because we spend less money servicing the subscription and can devote more on the stuff that you actually want from Home Energy, such as more information.  Even if you don’t extend your subscription, your benefits as a subscriber are increasing.  Home Energy is adding more content, better graphics, and offering a more useful Web site. Home Energy remains a good value for the money and our unusually high renewal rate of 80% plus implies that you readers agree.

There’s a second rising cost of home energy: the prices of the electricity, natural gas, and oil used to operate American homes.  These increases are less visible because the local price of electricity doesn’t typically appear on national news or posted along the highways.  Energy cost increases are also more gradual so, again, less likely to make headline news.

Natural gas and electricity prices aren’t likely to skyrocket like gasoline but I can see reasons to expect a continuing, steady rise.  It’s easy to blame those increases on the uncertainty in the Middle East, Africa, or South America but the larger problems are closer to home. That collapsed bridge in Minnesota signaled the dilapidated condition of our highway infrastructure.  America’s aging power plants, pipelines, and overburdened transmission network desperately need replacement but few consumers realize how these necessary investments will impact energy prices.   If we are clever we might be able to coordinate infrastructure renewal with a transition to greater reliance on renewables (and efficiency).  I am watching to see how utilities, regulatory commissions, and other players address this really tough nut.

There is also the rising cost of home energy conservation.  This is the additional cost to build an energy-efficient home, retrofit triple-glazed windows, or the premium on more efficient appliances.  Sadly, we can’t tell you how rapidly these costs are rising. Electricity and natural gas are well-defined products but energy efficiency is a complicated bundle of services, materials, and information (such as this magazine).  We like to think that the costs of saving energy are rising less rapidly than energy because we are getting better at what we do.  On the other hand, building or retrofitting an energy efficient home is labor intensive, so the pressures to increase prices (such as paying for health care, workers compensation, and insurance) are different than for oil or electricity.

Mitigating climate change provides a long-term justification for saving energy but economics is much more important in the short term.  That’s why it is important to take into account all of the costs of home energy.

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