Of the Cost of Energy

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The price you pay for energy in $/kWh

 Last week Pascale and I were invited to a barbecue on a very rainy and cool day. Our Kiwi friends didn’t cancel the party. Instead, the group gathered under the covered veranda around a small propane heater. What is the price of a kWh of energy in that form, I wondered?

You can get an 8.5kg bottle of propane for $26.95, that is $3.17 per kilo. A kilo of propane yields 49 megajoules. A kWh equals 3.6 megajoules, so the price of a kWh is 3.6 x 3.17 / 49. That is $0.233. If you look at your power bill, it is shoulder time between 7am to midday, so you may pay about $0.249 per kWh. That is close, just a bit more than propane.

What about the humble water kettle? You may wonder which type is cheapest to run. Gas or electric? At a glance, it looks about the same at shoulder time, when you make your morning tea. But we need to consider the device efficiency. The electric kettle efficiency is about 95%. Meaning 95% of the energy actually gets into the water. The gas kettle is quite different: only about 50%! Yes, half of the energy goes into the water, the other half is heating your kitchen. Nice in winter, maybe! That actually doubles your energy cost: it is more like $0.466. The electric kettle wins hands down, especially if you have solar panels. Then it goes to 0 if the sun is up.

 

About the graphs:

I used the same method to calculate the raw energy price for various sources (top graph).

Then I added the efficiency of various devices to get their actual energy price, like I did for the gas kettle. On this basis, electric vehicles (EV) look pretty good…


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