Things that caught my eye: subsidies, wine, LEDs, dismal economists

Lynne Kiesling

As a coda to Mike’s post yesterday regarding the CRS study of the effects of removing oil subsidies on gasoline prices, here’s Ron Bailey at Reason reminding us that ethanol subsidies are almost triple those to the oil companies, and with little to show either environmentally, economically, or energetically.

Courtesy of Dr. Vino, an Australian winery using a new German technology rather than a screw cap for its cellar-destined (at $500/bottle!) wines. Called Vino-Lok, the company touts its glass stopper/elastic ring technology’s wine-aging capabilities.

This week Philips is releasing a mass-market LED light bulb with a physical and lumens-delivering profile to mimic incandescents at a fraction of the energy use. But they’ll still be priced at $40-45, which is a bit steep for customers who are accustomed to cheap, short-lived bulbs, so their market success will require some education and adaptation of expectations. They will also have to overcome the hurdles of the failed expectations of compact fluorescent bulbs, which have not demonstrated the required longevity/price tradeoff to make them economical (in addition to their other shortcomings). I may buy one to test, but I don’t plan on fitting out my whole house in these LEDs any time soon, based on my CFL experience.

David Zetland reminds us of the provenance of the economist moniker “dismal scientist”, and claims that he likes to “take pride in calling attention to the unpleasant problems that impede human progress and happiness.” Me too, my friend, me too.

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5 thoughts on “Things that caught my eye: subsidies, wine, LEDs, dismal economists

  1. CFL’s “have not demonstrated the required longevity/price trade-off to make them economical”? While it’s true that, under many conditions CFLs don’t last as long as they claim (usually around 8000 hours), even if they only last 1000 hours (about the same as a conventional incandescent), they are still economical at current prices.

    If an $0.25 60w incandescent is replaced by a $3.00 13w CFL, the savings in the first 1000 hours are 47 kWh, or approximately $4.70 at $0.10/kwh, meaning that the electricity savings are worth $2 more than the difference in cost. At $3 each, CFLs would have to last *half* as long as incandescents in order to not be worth the money. The only exception is for very infrequently used bulbs, for which the payback is too slow to give a decent IRR.

    You may dislike CFLs for a large number of reasons, but you’d need some heroic assumptions to call them uneconomical.

  2. Tom,

    Your comment illustrates my point: “… While it’s true that, under many conditions CFLs don’t last as long as they claim (usually around 8000 hours), even if they only last 1000 hours (about the same as a conventional incandescent), they are still economical at current prices. …” It’s the failure to meet expectations that that manufacturers and CFL proponents have created that’s the problem. Whether or not I “like” CFLs is irrelevant.

  3. Totally agree with your point now that you explain it. The LED industry can learn a lot about what not to do when introducing a new product.

    Your phrasing led me to believe you were criticizing the economics of CFLs, not their marketing/PR.

  4. CFL lifetime’s fine! The spots work well, the tiny spirals work well. What expectation saw fail?

    I had 3 incidents with CFLs in globes that had fail taint to them, not least the last one with penny spacers to keep overheating from happening and an explanatory note; the pennies or globe-interior finish looked at me funny at T+2 years so that I took the pennies out, and their note fell at me blank, the ink having been evaporated, bleached, etc.; overheat fail followed.

    Globes; enamel or engrave their notes. Pick heat-shield scrap, mineral beads, hardened metals, or noble metal spacers (though PETE works well for 7-year intervals, too.)

    Maybe your light fixtures looked awesome with filaments? (Design pattern pix!) Bare CFL es menos macho que bare B1 base and envelope with tungsten ladder? Not enough IR heat splash over desk lamps with CFL in Illinois in November?

  5. If I knew what stuck market entries EtOH subsidies greased I’d probably drink it more; I mean, work to see those new markets into operation. Pass the dismal “alliance among Wall Street and the economics departments of the major universities and the West Wing of the White House” some good…. http://nymag.com/news/business/wallstreet/peter-orszag-2011-4/index1.html (Pretty good case made there, for instance.)

    That medical-looking Vino Lock has to cellar ca. 8-35+ years? Tough, even with a dust collar over the top. $3 in $100 down (back up to the $400 suggested after cellaring cost) makes it an easy enough call; for the price though, how about 5GB ‘contact’ flash memory included? Matte bottles so they work with refit caps in solar hot water installations?

    Cork Oaks can use the breather; or better, hook up the American Chestnut with the Cork Oak (instead of just the Chinese Chestnut) in a way that:
    they still grow in Zones 5-8 and, and
    if I line a street with them, cars and houses get softballed instead of totaled for glass, body and chassis damage.

    Watch though; someone who acts antiseptic, sweet and patient on reality TV will get their car’s nose metal-ceramic bonded with a bunch of Vino-Lock.

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