7

My hydro (electricity) bills always contain helpful hints on conserving energy: do laundry runs in the wee hours, favor LED over incandescent bulbs, etc.

I'm sure many at the big-energy corporate offices actually care about the environment, sustainability, and generally being eco-friendly. But I'm wondering if there are specific reasons that compel them to do so, outside of being responsible Earthlings.

Don't get me wrong, I'm glad they provide public service announcements like this. But I'm trying to understand why they would go against the corporate instinct to maximize profits.

  1. Are there laws that force energy companies to highlight energy saving tips?
  2. Does this provide a measurable marketing edge (show the public that We Care)?
| improve this question | |
  • Most hydro systems are at annual capacity and can't expand, so the hydro companies in particular will be trying to avoid having to build new power plants. There are also complex analyses around where the profit comes from - if they can shift demand from low-profit areas to high-profit areas, they make more out of selling the same amount of electricity. – Móż Aug 17 '16 at 3:07
5

One argument in favor is load balancing:

If you can manage to shave off request peaks, your systems can be smaller and/or have to scale up and down slower and less frequently. That all pays itself back in building and maintaining your infrastructure.

  • It does not matter if the customer changes hours, he is paying for the electricity anyway.*
  • If the consumer actually uses less, my guess that is offset by the benefit mentioned above.

You can interpret 'load' several ways:

  • For companies actually producing electricity it means having to build less (peak) capacity.
  • For resellers it means having to pay less to the actual producers, because prices are more and more determined by instantaneous demand.

* This is offset somewhat if the user also is billed less in low-demand hours

| improve this answer | |
  • Great points :) – Dirty Penguin Aug 16 '16 at 18:52
  • I would add, electric utilities are natural monopolies: the largest and/or first supplier gets all the customers, permanently. As a result, there is little they can do to increase their customer base (people don't move in order to patronize a different utility), and rates are typically capped by policy makers. – LShaver♦ Aug 23 '16 at 15:28
  • @LShaver That very much depends on the country you're in - not here in The Netherlangs e.g. – user2451 Aug 23 '16 at 18:43
  • @JanDoggen, I assume you mean on the supply/generation side, correct? How is distribution handled - public, private, or some combination? In any case, that's likely to be a natural monopoly - unless there are multiple sets of wires running to each customer – LShaver♦ Aug 23 '16 at 18:58
  • @LShaver Network companies (which there are only a few, essentially regional monopolies) are by law required to give all producers/distributors access across one power line. – user2451 Aug 24 '16 at 7:50
1

They're mandated and/or sponsored by government. The companies are slightly motivated to use this money well to appear as friendly, neighbourhood, we-have-your-interests-at-heart companies, i.e. generate customer goodwill, since someone else is funding it. E.g. Imporoving Energy Performance in Canada. And this works because it reduces energy costs per economy/gdp. The last watt generated is the most expensive, so it's win-win for everyone.

I will admit it sounds a little wasteful, but a lot of change happens only because of this sort of thing. E.g. the greatest indicator of a household installing solar panels is actually other households nearby with solar. (Vox.com: Solar power is contagious) People bought more LEDs when they saw/heard other people with LEDs, so stores sold more LED lighting, etc. We're not the most rational of consumers...

| improve this answer | |

Your Answer

By clicking “Post Your Answer”, you agree to our terms of service, privacy policy and cookie policy

Not the answer you're looking for? Browse other questions tagged or ask your own question.