18
Mar
10

Increased marginal supply of… pricy electricity?

When Jane Austen began Pride and Prejudice by declaiming an absolute principle:

It is a truth universally acknowledged, that a single man in possession of a good fortune, must be in want of a wife.

it was at least widely acknowledged that she was being sarcastic.  Unfortunately, I cannot say the same for the colony of dumbworms now inhabiting the skull of the former Simon Houpt, who begins his article thus:

It’s one of the tenets of capitalism: Given a choice of two identical things, people will pick the less expensive one.

This is true, misleading, and utterly irrelevant to his story.

He continues:

Yet next Monday, a new advertising campaign will bluntly ask Canadians to pay a premium of about 30 per cent for a commodity that is indistinguishable from one they already buy every day. In its first mass-media move since launching in late 2005, clean energy provider Bullfrog Power will hit the airwaves with TV and radio spots that conclude with the tagline: Pay More For Energy.

(Emphasis added.)

Simon Houpt made her cry, not Bullfrog Power.

This is so obvious that even a journalist should be able to figure it out.  People aren’t going to choose to pay 30% more for the same service; they’re going to choose to pay 30% more for a service they believe to be better.  Why?  Because Bullfrog Power is advertising electricity with lower external costs.  Which is the larger point of the article.

Houpt even quotes a guy talking about external costs:

“Conventional energy has many costs associated with it that are not reflected in the price,” said Tom Heintzman, Bullfrog’s president, referring to the effects on human health and the environment – absent from any company balance sheet – of so-called dirty energy plants. (Your Economics 101 prof called these costs “externalities.”)

“That notion of pricing-in externalities is a dialogue that’s been conducted in academia, somewhat in the media, but not at all at the street level,” Mr. Heintzman continues. “But it’s one of the most important questions for Canadians, and frankly everyone, to wrestle with, because it’s one of the most powerful levers to address climate change.”

And he fucking well ends the article by contradicting his lead-in:

Hope and satisfaction: Now selling for about 3 cents per kilowatt hour.

Layers of editorial oversight….

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1 Response to “Increased marginal supply of… pricy electricity?”


  1. March 21, 2010 at 09:05

    Of course the glaring cost associated with paying 30 percent more for something as fungible as electricity is that 30 percent represents investment or profit that isn’t being used for new investment or capital that would increase the standard of living for those of us reliant upon the free market system for our society’s advancement.

    It’s a pretty straight-line reduction in the wealth of our nation.
    .


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