Energy—Costs and Values Mike Schmidt Emerson Process Management T-I-E Workshop February 10, 2006

Learning Objectives Understanding how we consume energy in our daily lives Understanding how we consume energy in our daily lives Understanding the choices we can make to influence our energy consumption Understanding the choices we can make to influence our energy consumption

Discovery What is the mix of teachers in the class? What is the mix of teachers in the class? High school, middle school, elementary High school, middle school, elementary Urban, suburban, exurban (small town or rural) Urban, suburban, exurban (small town or rural) Public, private Public, private What resources do you have available? What resources do you have available? Well-stocked, well-equipped labs Well-stocked, well-equipped labs Ample, or at least adequate, budget Ample, or at least adequate, budget Corporate or plant resources Corporate or plant resources

In what form does our energy come? Electricity Electricity Natural gas Natural gas Gasoline Gasoline Others? Others?

Energy saving tips Write down some ways that you’ve heard suggested for a Midwestern family to save on energy costs Write down some ways that you’ve heard suggested for a Midwestern family to save on energy costs

How do we buy energy? Electricity – by the kilowatt-hour Electricity – by the kilowatt-hour Natural gas – by the 100 cubic feet Natural gas – by the 100 cubic feet Gasoline – by the gallon Gasoline – by the gallon All energy – by the $

Develop a hypothesis How does your family spend its energy dollar? How does your family spend its energy dollar? How much does your family spend on energy? How much does your family spend on energy?

Test the hypothesis Develop procedure Develop procedure Collect data Collect data Analyze data Analyze data

My household energy use

10 year earlier

Household energy use—over time

Draw conclusions ???? ???? Something really unusual happened in Something really unusual happened in Electricity and natural gas spending is fairly constant, but gasoline spending is climbing. Electricity and natural gas spending is fairly constant, but gasoline spending is climbing. What next? What next?

Spending less means using less Reduce the things we do Reduce the things we do Do the things we do more efficiently Do the things we do more efficiently Where do we start?

Reduce costs for gasoline Hypothesis: Hypothesis: My family can reduce costs with a hybrid. My family can reduce costs with a hybrid. Data: Data: Current 2 vehicles are paid for. Current 2 vehicles are paid for. They get around ~21 mpg. They get around ~21 mpg. My family spent $4000 on gasoline in My family spent $4000 on gasoline in Gasoline prices are at $2.20/gal and going up. Gasoline prices are at $2.20/gal and going up. Analysis Analysis My family drives about 38,000 miles a year. My family drives about 38,000 miles a year.

Ford Escape Hybrid Ford Escape Hybrid SUV MSRP: $27, mpg city/31 mpg highway 5 passengers Ford Escape SUV MSRP: $19, mpg city/26 mpg highway 5 passengers

Ford Escape-comparison $27,515 vs. $19,995 = $7520 $27,515 vs. $19,995 = $ ,000 miles per year, $2.20/gallon 19,000 miles per year, $2.20/gallon 33.5 mpg vs. 24 mpg  33.5 mpg vs. 24 mpg  $1248/yr vs. $1742/yr = $494/yr savings $1248/yr vs. $1742/yr = $494/yr savings 15.2 years to pay back 15.2 years to pay back 5 year pay back if gasoline is $6.69/gallon 5 year pay back if gasoline is $6.69/gallon 5 year pay back if hybrid costs $5050 less 5 year pay back if hybrid costs $5050 less

Honda Civic Hybrid Honda Civic Hybrid Sedan MSRP: $21, mpg city/51 mpg highway 5 passengers Honda Civic Sedan MSRP: $14, mpg city/40 mpg highway 5 passengers

Honda Civic-comparison $21,850 vs. $14,560 = $7290 $21,850 vs. $14,560 = $ ,000 miles per year, $2.20/gallon 19,000 miles per year, $2.20/gallon 50 mpg vs. 35 mpg  50 mpg vs. 35 mpg  $836/yr vs. $1194/yr = $358/yr savings $836/yr vs. $1194/yr = $358/yr savings 20.4 years to pay back 20.4 years to pay back 5 year pay back if gasoline is $8.96/gallon 5 year pay back if gasoline is $8.96/gallon 5 year pay back if hybrid costs $5500 less 5 year pay back if hybrid costs $5500 less

Toyota Prius Toyota Prius Sedan MSRP: $21, mpg city/51 mpg highway 5 passengers Toyota Corolla CE Sedan MSRP: $14, mpg city/38 mpg highway 5 passengers

Prius vs. Corolla CE $21,725 vs. $14,105 = $7620 $21,725 vs. $14,105 = $ ,000 miles per year, $2.20/gallon 19,000 miles per year, $2.20/gallon 55.5 mpg vs. 34 mpg  55.5 mpg vs. 34 mpg  $753/yr vs. $1229/yr = $476/yr savings $753/yr vs. $1229/yr = $476/yr savings 16.0 years to pay back 16.0 years to pay back 5 year pay back if gasoline is $7.04/gallon 5 year pay back if gasoline is $7.04/gallon 5 year pay back if hybrid costs $5240 less 5 year pay back if hybrid costs $5240 less

Can we draw conclusions? For my family, the higher price for a hybrid is not worth the savings in fuel For my family, the higher price for a hybrid is not worth the savings in fuel What conclusions can you suggest? What conclusions can you suggest?

Other comparisons Is comparing between hybrid and non- hybrid models the best way to draw conclusions? Is comparing between hybrid and non- hybrid models the best way to draw conclusions? What if we don’t care if its hybrid, as long as it gets good gas mileage? What if we don’t care if its hybrid, as long as it gets good gas mileage?

Hyandai Accent MSRP: $12, mpg city/35 mpg highway 5 passengers $1248 per year for gasoline

Volkswagen Jetta Volkswagen Jetta Sedan MSRP: $17, mpg city/41 mpg highway 5 passengers $1085 per year for gasoline

Pontiac Vibe Pontiac Vibe Hatchback MSRP: $16, mpg city/36 mpg highway 5 passengers $1267 per year for gasoline

Comparing total costs MSRPAnnual Gas*5-year cost Hyandai Accent Sedan$12,455$1,248$18,695 Toyota Corolla CE Sedan$14,105$1,229$20,250 Honda Civic Sedan$14,560$1,194$20,530 Pontiac Vibe Hatchback$16,990$1,267$23,325 Volkswagen Jetta Sedan$17,900$1,085$23,325 Toyota Prius Sedan$21,725$753$25,490 Honda Civic Hybrid Sedan$21,850$836$26,030 Ford Escape SUV$19,995$1,742$28,705 Ford Escape Hybrid SUV$27,515$1,248$33,755 *Based on 19,000 miles per year and $2.20/gal

What if gas cost $6/gal? MSRPAnnual Gas*5-year cost Hyandai Accent Sedan$12,455$3,404$29,473 Honda Civic Sedan$14,560$3,256$30,842 Toyota Corolla CE Sedan$14,105$3,352$30,864 Toyota Prius Sedan$21,725$2,054$31,993 Volkswagen Jetta Sedan$17,900$2,959$32,695 Honda Civic Hybrid Sedan$21,850$2,280$33,250 Pontiac Vibe Hatchback$16,990$3,455$34,267 Ford Escape SUV$19,995$4,751$43,750 Ford Escape Hybrid SUV$27,515$3,404$44,533 *Based on 19,000 miles per year and $6.00/gal

How high must gas prices go? MSRP Annual Gas*5-year cost Hyandai Accent Sedan$12,455$4,674$35,827 Toyota Prius Sedan$21,725$2,820$35,827 Honda Civic Sedan$14,560$4,472$36,920 Toyota Corolla CE Sedan$14,105$4,603$37,121 Honda Civic Hybrid Sedan$21,850$3,131$37,506 Volkswagen Jetta Sedan$17,900$4,064$38,219 Pontiac Vibe Hatchback$16,990$4,745$40,717 Ford Escape Hybrid SUV$27,515$4,674$50,887 Ford Escape SUV$19,995$6,525$52,618 *Based on 19,000 miles per year and $8.24/gal

What about utilities? Why do we use natural gas and electricity? Why do we use natural gas and electricity? Form a hypothesis Form a hypothesis ???? ???? Test the hypothesis Test the hypothesis Develop procedure Develop procedure Collect data Collect data Analyze data Analyze data

Procedure Collect utility bills Collect utility bills Look for patterns Look for patterns

Natural gas—a pattern?

There is a base level of use Steady use all year long for hot water, $28/month

Natural gas—peaks in winter? The peak use is for winter heating

Can we draw conclusions? Total use from Jan-03 to Dec-05: $3,339 Total use from Jan-03 to Dec-05: $3,339 Base level of gas use, for heating water Base level of gas use, for heating water $28/month, $336/year $28/month, $336/year $1,008 from Jan-03 to Dec-05: 30% $1,008 from Jan-03 to Dec-05: 30% Most gas is used in the winter for heating Most gas is used in the winter for heating Heating season from October to April Heating season from October to April Peak is in January or February Peak is in January or February $2,331 from Jan-03 to Dec-05: 70% $2,331 from Jan-03 to Dec-05: 70%

Any patterns in electricity use?

Electricity also has a base level Steady use all year long for lighting, cooking, etc. $69/month

Electricity peaks in summer The peak use is for summer air conditioning

More conclusions? Total use from Jan-03 to Dec-05: $3,832 Total use from Jan-03 to Dec-05: $3,832 Base level of electricity use, for lighting, cooking, computing, etc., accounts for most use Base level of electricity use, for lighting, cooking, computing, etc., accounts for most use $69/month, $828/year $69/month, $828/year $2,484 from Jan-03 to Dec-05: 65% $2,484 from Jan-03 to Dec-05: 65% About 1/3 of electricity use is for air conditioning About 1/3 of electricity use is for air conditioning Cooling season from May to September Cooling season from May to September Peak is in July or August Peak is in July or August $1,348 from Jan-03 to Dec-05: 35% $1,348 from Jan-03 to Dec-05: 35%

Does combining reveal anything? Combined base is $97/month There is no gap between heating and cooling!!

Consider your energy saving tips If changing filters on your furnace every month instead of every year improved efficiency by 5%, what is that worth? If changing filters on your furnace every month instead of every year improved efficiency by 5%, what is that worth? If keeping your tires properly inflated improves gas mileage 5%, what is that worth? If keeping your tires properly inflated improves gas mileage 5%, what is that worth? If keeping your air conditioning unit shaded reduces electricity use by 10%, what is that worth? If keeping your air conditioning unit shaded reduces electricity use by 10%, what is that worth?

Evaluation What is the most useful thing you learned? What is the most useful thing you learned? What is the most surprising thing you learned? What is the most surprising thing you learned?

Reflection Does energy have a value other than the dollar value we give it? Should it? Does energy have a value other than the dollar value we give it? Should it? What reasons might one form of energy cost more or less than the same amount of energy in a different form? What reasons might one form of energy cost more or less than the same amount of energy in a different form? What will happen to the cost and value of energy when people in developing countries like China and India can finally afford automobiles and air conditioning? What will happen to the cost and value of energy when people in developing countries like China and India can finally afford automobiles and air conditioning?

References U.S.Dept. of Energy, Office of Energy Efficiency and Renewable Energy, U.S.Environmental Protection Agency. U.S.Dept. of Energy, Office of Energy Efficiency and Renewable Energy, U.S.Environmental Protection Agency. Energy Information Administration. Energy Information Administration. Office of Energy Efficiency and Renewable Energy. Office of Energy Efficiency and Renewable Energy.