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A new power bill approach is highly needed

image credit: Instant heater x tank heater
Rafael Herzberg's picture
Consultant energy affairs Self employed

Rafael Herzberg- is an independent energy consultant, self-employed (since 2018) based in São Paulo, Brazil* Focus on C level, VPs and upper managers associated to energy related info, analysis...

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  • Jul 10, 2020

A new power bill approach is highly needed

What makes more sense to you regarding water heating?

Option "A": go for a 9.5 kW tank-less water heater 
Option "B" go for a 1.5 kW 20 gallon water heater

Total installed cost for both are about the same. And at the end of the day the amount of kWh used to heat the water is about the same as well. 

Then the decision is about your personal preference because the power cost is the same.

But ... for the power providers it makes a huge difference because being able to meet a 9.5 kW load requires a lot more grid infrastructure than the 1.5 kW load. 

Don't you agree that the guy who chooses the 1.5 kW 20 gallon heater should get a hefty benefit? 

Tariffs have been based in kWh for more than a century. This is especially so for residential energy users. For industrial/commercial and institutional ones as well but there is a kW charge that is usually a smaller proportion of the power bill - around 20% typically.

It is high time to change the rate structure to reflect the real incurred costs. Simply put because in this example of the water heaters, the one who decided to go for the 1.5 kW option is actually subsidizing the one who chose the 9.5 kW.

If you would like to better understand the concept I have in mind and the associated calculations make sure to get in touch.

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Thank Rafael for the Post!
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