CEO of Business Juice James Constant looks at the dark side of energy costs.
Naturally, given the business I’m in, I am heavily involved in the energy debate. In truth, most of the time, the debate is focused on two main issues:
- How much energy costs,
- Where we’re going to get it from in the future.
There are also four main threats that get talked about:
- Vulnerable domestic consumers going cold,
- Businesses having to scale back or close operations through costs,
- Long-term security of supply (will we have enough energy in years to come),
- Sustainability.
The relative control individuals have over such things is confined to shopping around for a better deal and making prudent efficiencies on energy usage, and these things focus on the self, with little impact beyond the walls of the business or household.
However a truly shocking statistic has emerged:
3080 miles of motorways and trunk roads in England are now completely unlit.
It seems in the effort to save money; councils have chosen to turn lights off at night when they (quite bizarrely) say there is less need for them! Others have chosen to install dimming technology, albeit at a capital investment cost.
Quite frankly, this is madness.
The switch-off of motorway lights means that 70% of the network is now unlit at night, including the M1, M2, M27, M4, M48, M5, M54, M58, M6, M65 and M66. I don’t know about you but that does not sound an appealing prospect.
Paul Watters, head of roads policy at the AA, said: “We do know that most accidents happen in the dark, its also comforting for people, especially if they arrive back from somewhere in the night, when they have got a late train. There are also suggestions that it increases crime. So it may save money in terms of energy but then you have to look at the cost in terms of security, safety and accidents, it may actually be more.”
The Daily Telegraph reports that Leicestershire County Council expects to save £800,000 a year in energy bills by adapting one third of their 68,000 streetlights so that they can be dimmed or turned off at night.
So taking Leicestershire County Council’s own figures from 2010/11 they report that street lighting contributed 17,675 tCO2 in carbon emissions which is roughly translated as 33,000,000 kWh or at 10p/kWh an annual bill of around £3.3m for street lighting. And they claim savings of nigh on 25% on that in a single year. Or in simple terms, shaving 2.5p/kWh off your unit rate.
But let’s focus on the dark side of these actions by the councils:
- How long will it take the savings to come to fruition once capital costs are taken into account?
- What is the impact on other ‘costs’ like security, safety and accidents? Is this even quantifiable?
Indeed Worcestershire County Council postponed plans to switch off and dim lights after it found it would cost more money to implement the scheme than it would save! The authority currently pays £2 million a year to run 52,000 street lights but it found that to reduce that bill by £600,000 a year it would need to invest £3.4 million first.
On a comparative basis then, Leicestershire County Council’s investment would ‘cost’ on a pure capital basis £5.7m therefore taking a monstrous seven years to bring a net benefit to the council budget. Seven years of roads plunged into darkness. Seven years of risk, fear and injury.
The truth? This is about carbon emission targets, not pure cost savings. A mighty commendable endeavour but the immediate human cost surely needs to be factored in?
For a long time now I have been a proponent of what we call the p/kWh vs. kWh debate. Where a saving in p/kWh can be multiplied many times by the impact of sensible efficiencies in energy usage, but sensible is one thing the great street & motorway light switch off is patently not.
What a situation the public is being faced with, I’m sure that Leicestershire County Council’s energy procurement policy is sensible and that appropriate cost savings are being delivered, but the policy of risking those of us who live in the present is not an acceptable quid pro quo. If they are delivering energy savings through better contract negotiation without the need for such drastic measures then their constituents I am sure will be accepting of the resultant energy costs when set against the totally imbalanced quid pro quo of cheaper council tax in exchange for Russian roulette night time travel.