This summer, we were thrilled to welcome Lilah Dicker, a Junior at Johns Hopkins University, as an intern at Intelligent Generation. It’s always inspiring to introduce fresh perspectives to the dynamic world of renewable energy. With no prior industry experience, Lilah embraced the challenge of understanding our rapidly evolving sector head-on. Her dedication and sharp intellect led to remarkable insights, including uncovering common misconceptions about electricity and the energy industry. A short summary is below, but be sure to watch her video to gain valuable knowledge and fresh perspectives.
Myth #1: Power and Energy Are the Same Thing
One of the most common misunderstandings is the difference between power and energy. Power, measured in watts, indicates how quickly energy is being used or produced. Think of it like the speed of a car. Energy, measured in watt-hours or kilowatt-hours, represents the total amount of work done or electricity consumed over time. This is akin to the distance traveled by a car.
Understanding this distinction is crucial, especially in the context of batteries. A battery’s power rating signifies how quickly it can deliver energy, while its energy capacity determines how much total energy it can store.
Myth #2: Deregulation is a Free-for-All
Deregulation in the energy sector doesn’t mean chaos. While it does introduce competition among energy providers, allowing consumers to choose their preferred plans and rates, the delivery of electricity remains in the hands of utility companies. These companies are responsible for maintaining the power lines and ensuring reliable service. It’s like ordering a pizza with your favorite toppings – you choose the ingredients, but the delivery is handled by a separate service.
Deregulation can also provide more choices for consumers as to the sources of their energy generation, in particular more choices in renewable and clean energy. Deregulated utilities are also typically more accommodating to customers wanting to install solar panels, batteries, and other cost saving power generation technologies.
Myth #3: Electricity Bills Are Simple
Your electricity bill is more complex than just a total usage amount. It comprises several charges, each serving a specific purpose:
- Energy charge: Energy consumed is the easiest to understand component of your electricity bill. Think of it as paying for the fuel that energizes your lights and operates your appliances, motors, computers, and air condition system. It’s measured in kilowatt-hours (kWh)
- Capacity charge: Covers the cost of ensuring electricity availability to meet peak demand. Measurement is in kilowatts (kW).
- Demand charges: Based on your highest electricity usage during a billing period. Measurement is in kilowatts (kW).
- Transmission charges: Associated with transporting electricity from power plants to your business. Measurement is in kilowatts (kW).
Understanding these charges empowers you to make informed decisions about your energy consumption and potentially reduce your bill.
Myth #4: Reducing Electricity Consumption is the Only Way to Save Money
While conserving energy is always beneficial, there’s more to lowering your electricity bill. By understanding how demand and capacity charges are calculated, you can implement strategies to reduce these costs without sacrificing comfort. For example, managing your energy consumption during peak hours can significantly impact your overall bill.
Installing solar panels at your building will reduce the energy charges because you’ll buy fewer kWh from the grid, but solar will not have as much impact on your capacity, demand, and transmission charges. In fact, solar may not reduce those charges at all. However, installing batteries at your building with the proper controls and management can help save money by reducing capacity, demand, and transmission costs.
Myth #5: Electric Vehicles Are Completely Green
Electric vehicles (EVs) are undoubtedly cleaner than traditional gasoline-powered cars, but they aren’t entirely emissions-free. While EVs produce zero tailpipe emissions, the electricity used to charge them comes from power plants, which often rely on fossil fuels. However, EVs are still significantly more efficient than gas-powered vehicles, and the environmental benefits are substantial. Additionally, the pollution generated by power plants is typically concentrated in specific locations, reducing its immediate impact on communities.
How and when you charge EVs, especially for fleets, needs to be carefully considered as to how the charging will affect your electricity bills. Charging during peak times can significantly increase your electricity costs and wipe out the saving benefits that EVs can have over traditional combustion engine vehicles. Here again, charging systems with batteries and potentially solar can help manage electricity costs.
I hope these insights have shed some light on the fascinating world of electricity. By debunking these common misconceptions, we can become more informed consumers and make better decisions about our energy usage.