HIDDEN COST OF FOSSIL FUELS UTILISATION.
By Emil Bedi, CANCEE and Hakan Falk, "Energy Saving Now".
It is important to note that when energy
experts are comparing different energy sources the question of their price is
the crucial one and renewables are mostly considered as more expensive than
fossil fuels. What is not known is the fact that such a comparison is usually
based of wrong estimation of costs. When we pay the electric bill to the power
company or fill up our car’s tank, we usually pay a specific price for the
energy which does not express the full cost related to energy consumption. What
we do not pay are many hidden costs associated with our energy usage. And there
are several of them. Hidden social and environmental costs and risks associated
with fossil-fuel use are principal barriers to the commercialization of
renewable technologies. It is a well recognised fact that current markets mostly
ignore these costs. In effect, relatively harmful sources, e.g., high sulphur
coal and oil, are given an unfair market advantage over benign renewable
sources. Since competing conventional technologies are able to pass on to
society a substantial part of their costs (such as environmental degradation and
health-care expenditures) renewable sources, which produce very few or no
external and may even cause positive external effects such as job creation,
rural regeneration and foreign-exchange earnings, are systematically put at a
disadvantage. Internalising all these costs therefore must become a priority if
a “level playing field” is to be created.
While
it is extremely difficult to quantify the external costs of such pollution, and
some simply cannot be quantified, several studies show them to be substantial.
For example, a German study concluded that the external costs (excluding global
warming) of electricity generated from fossil-fuel plants are in the range of
2.4-5.5 US c/kWh, while those from nuclear power plants are 6.1-3.1 c/kWh.
According to the another study sulphur dioxide from US coal burning plants is
costing U.S. citizens USD 82 billion per year in additional health costs.
Reduced crop yields caused by air pollution is costing US farmers USD 7.5
billion per year. What is important on these US figures is the fact that US
citizens are actually paying between 109 billion and 260 billion dollars yearly
in hidden energy costs. In other countries similar patterns can also be found.
Had external economic effects been included in the market allocation process,
renewable technologies would be in a far better position to compete with fossil
fuels, and there might already have been a substantial shift to the penetration
of renewable in the market.
ENERGY SUBSIDIES
Many governments are heavily subsidising the energy industries. It is
interesting to note that the energy technologies with the worst health and
environmental impacts usually receive the most government money. The worst
polluters, nuclear and combustion technologies, in the U.S. alone receive 90% of
the government money. The renewable energy technologies, which offer little or
no side effects, receive the least government support. Solar technologies (both
PV and thermal together) receive in the USA only 3% of the government money. At
the bottom of the list is conservation with 2% of the subsidy dollars. And there
is not much difference in other countries of the world. This is amazing since
renewables and energy savings offer relief from our energy problems and has no
environmental side effects. Something is really wrong here.
MILITARY
 World’s dependence
on imported oil requires that military will keep the international supply lines
open. The U.S. military is spending between 14.6 and 54 billion dollars yearly
just defending the oil supplies coming from the Persian Gulf. On the low side,
the National Defence Council places the Persian Gulf military cost at 14.6
billion. On the high side, the estimate of 54 billion is made by the Rocky
Mountain Institute. There are also other hidden national security costs. One of
these is military aid to oil producing nations. Another is diplomatic and
foreign policy decisions made on the basis of imported oil.
RADIOACTIVE WASTE
The major problem associated with nuclear power is, “What do we do with
the radioactive waste?” To date, no one has a viable disposal solution for the
thousands of tonnes of high level radioactive waste nuclear power plants
generate. This problem is made more severe because it is a long term problem.
For example, plutonium (Pu239) has a radioactive half-life of 24,400 years and
is environmentally dangerous for over several hundred thousands years. We are
making nuclear decisions now that will affect our planet, and all life forms on
it, for millennia in the future. The World Watch Institute estimates the
disposal costs of nuclear waste at between 1.44 and 8.61 billion dollars per
year. Radioactive waste disposal is not actually disposal, but containment. We
will have to deal with high level waste for thousands of years. We now have no
method of actually disposing of high level waste. We simply store it and hope
our children can figure out a safe way to deal with it. This estimate doesn’t
include the cost of nuclear accidents. What does a “Chernobyl or Three Mile
Island” cost to clean up?
Town Pripjat (population 30.000 before nuclear
accident happened in Chernobyl in 1986) is now uninhabited and closed due to
radioactive contamination.
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