THE VILLAGE SOAPBOX
Ron gets on his Soapbox to talk about rising costs to local home owners
Until very recently, as a result of subsidies, we were told that European farmers were producing too much, that they were producing surpluses that were being sold on the world market at prices so low that farmers in developing countries could not compete. Subsidies were reduced and efforts are being made to restrict European output of some crops, sugar for example, in order to give these overseas farmers a better chance to produce these crops at an economic price. In order to do this Farmers in Europe were being paid for set-aside land, leaving some of their land uncultivated. Now the rising price of oil and the concern over CO2 emissions has led to encouragement to produce bio-fuels from various crops.
Many environmentalists have challenged the overall benefit of bio-fuels and concern is being expressed over the use of land for that purpose rather than for food production. For a number of reasons, including the growing of crops for bio-fuels, there is currently a world shortage of some basic food crops. The inevitable consequence has been higher food prices. Some people in third world and developing countries have been unable to afford these higher prices, this has led to instances of starvation and, not surprisingly, there have been protests and riots.
Where do we go from here? Must we stop growing bio-fuel crops? Where will our future fuel supplies come from? Should European farmers switch to producing as much food as possible? If they did how would it be financed and what would we do with the surplus? We can't go back to dumping it on the world market, can we? In the short term clearly we must do what we can with food aid to stop people from starving. In the medium term, however, we have to help developing countries to feed themselves and aid should be directed in that direction. Perhaps by encouraging the growing of more GM crops, perhaps by helping small farmers to produce more with improved organic methods. Potatoes offer a means of producing more food per hectare, perhaps we should encourage a switch away from rice and wheat based foods such as pasta and encourage more people to eat more potatoes as their basic food (As was done during the war in this country. Who remembers 'Potato Pete?). Perhaps we should try to stop these countries, where food is short, from producing bio-fuels, not easy to do in a free market situation. No doubt there will be a combination of all these things. If the developed world cannot easily supply food to the rest of the world without upsetting the world market then maybe it should be the developed countries that grow bio-fuel crops. Would that deny developing world farmers from benefiting from the crops with the best financial returns? In any discussions along these lines, however, we should remember that bio-fuel technology is in its infancy and alternate sources and waste products might well be utilised in the future.
Hopefully action will be taken to overcome the immediate problem, although I did see a statistic recently that 25,000,000 people are already dying every year because of starvation, that is a frightening figure, it is almost one person every second. I view the long term with some trepidation. No doubt part of the problem of high food prices is due to the high price of oil and, whilst it may be possible that we see a drop in oil prices in the near future, there can be no doubt that the long term trend for oil prices has got to be upwards. Overcoming the present food supply crisis will only mean that world population will continue to increase so that we will ultimately reach a point where food supply problems cannot be overcome. Unless more positive action is taken throughout the world to control population growth there will be starvation and there will be wars as people fight for the productive land. The Chinese have been accused of being ruthless, even cruel, by their imposition of a rule of only one child per adult couple but it needs many more national governments to adopt a similar rule. Population growth is far more serious than climate change yet it continues to be the elephant in the room that politicians ignore. I was at an international conference on energy supplies in the 1970s, there the then American president of the SAE said "We are approaching the tunnel at the end of the light" and he was not just talking about fuel supplies. The tunnel may have been further away than he thought but it is getting much closer now.
The cost of heating our homes
Anyone who has had to replenish their oil stock recently will have been staggered by the price increase. Currently, at somewhere near 55p/litre this is an increase of more than 10p since last autumn. Since April 2006 the price has increased by almost 20p, that is 60%. In just three and half years the price has doubled. Unfortunately the long term view is almost certainly for further increases. The cost of heating our house as a proportion of our income is bound to increase.
There is little alternative to oil for us in this area. Solid fuels for open or semi-open fires are not cheap and most such fires are not very efficient. Solid fuel boilers are not likely to make a come-back at this time but who can tell what might happen in the longer term. LPG such as Calor gas is never likely to be attractive on cost when supplied in bottles, it may be more competitive if delivered by tanker to a pressurised tank but such an installation may not be suitable for domestic purposes. Electricity with a two tier tariff combined with storage heaters can be competitive, although the daytime tariff on some two tier tariffs can be much higher than on a flat rate tariff.
At 52p/litre and a boiler with an efficiency of 80% heating costs are 6.44p/kWh. A modern condensing boiler correctly used might bring that cost down to about 5.7p/kWh.
At the time of writing:
The normal flat rate for electricity from nPower starts at 12.9p/kWh falling to 11.3p/kWh
An Economy7 tariff from nPower gives an overnight rate for storage heaters, hot water etc of just 4.2p/kWh, but daytime rates start at 22.1p/kWh dropping to 12.7p/kWh as use increases.
For those with two meters for daytime and night-time use, eON charges 5p/kWh for night time use and 18.5p/kWh falling to 11.09p for day time.
On the basis of these figures, those with night time meters combined with storage heaters appear to be getting a slightly better deal, depending on the extent of their day-time use, but the poor control associated with storage heaters could offset any advantage that they might offer over an oil fired system.
There are many ways open to us to reduce our energy consumption apart from just being more economical e.g. better insulation, double or triple glazing, a new boiler, solar panels and windmills. Unfortunately, even with these oil prices, it would take many years before any such installation recovered its initial cost, with the possible exception of improved insulation, depending on how poorly your home is currently insulated.