Will Taylor

Graph of the Day: How home batteries might benefit houses without solar

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I’m pretty excited about the Tesla Powerwall, the home battery that was announced recently. People mostly think about home batteries as being important for solar.  For residential solar,  most of your generation is during the day when you aren’t home, so it gets sold back into the grid and therefore relies on the whatever the buy back rate set by your retailer is.  If you are looking for practical tips for solar installation, check out https://enlytenenergy.com/top-5-things-you-need-to-know-about-running-your-home-on-solar/. These rates are lower than the retail price of electricity so the real benefit is if you can store the “free” electricity you generate in a battery and then use it during peak hours instead of paying for electricity, thus avoiding your variable electricity charge of 20-30 c/kwh.

So the economics of solar depend on whether your savings (avoided retail prices + electricity sold back into the grid) justify the cost of installing solar panels and a battery (typically well over 10k, but costs are falling).

But if you don’t have solar, home batteries could have another use: storing cheaper power generated during off-peak and using it during peak when prices are high.  This of course only works if you have variable electricity pricing, which isn’t super common in New Zealand.  But if you are have day/night rates, or are on Flick Electric like me, then you might be able to exploit the difference between peak and off-peak prices and save some money.   See, for example, the below graph of my electricity use and prices from last Tuesday.

power graphI have drawn some lines indicating the “overnight price”, the “morning peak” and the “evening peak”.  Note that I didn’t use a lot of power that evening (we usually do so this is non-representative), but did use a fair amount in the morning, which is unavoidable.  I also ran my dishwasher on delay that night to take advantage of lower prices later in the evening. If I could store power at the “overnight rate” of 10 c/kwh, there are times when I could halve my variable cost of electricity (i.e. those times during peak when I can’t change my behavior).

Whether or not buying a battery to take advantage of variable pricing stacks up financially depends on:

  • how much the battery costs
  • how much it can store
  • how much power you use that you can’t shift  to off-peak (i.e. by setting the dishwasher on delay); and
  • what the price is at those times.

Hopefully someone does proper modelling of it, or maybe Flick will team up with Vector who have a “special” relationship with Tesla.  You could get some pretty complicated/cool software if you integrated this type of logic with Solar. I.e. buying power over night when the forecast is for rain the next day.

(Related: Visit here to find the most efficient home generator reviews)

jamesz

Do old people hurt growth?

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A new paper (PDF) claims that ageing populations will hinder growth by both dis-saving and dragging down innovation, thus reducing productivity. Using a VAR model, they relate the age structure to measures of growth, saving, investment, and other macroeconomic variables over the 1990-2007 period. They use those coefficients to predict the effect of demographic change on growth rates in the current decade. The results are dramatic, predicting that an ageing population will knock over a percentage point off some countries’ growth rates.

In a ray of light, this morning’s FT (£) reported a study of over 15,000 German employees that examined the relationship between ageing and productivity. One of the authors is quoted saying:

As workforces age, employers are concerned that productivity will decrease. That is not so. What matters is not chronological age but subjective age.

The research suggests that older people are systematically excluded from training activities, and are relegated to less creative and meaningful work, which renders them less productive. As the workforce ages, that may begin to change. As it changes, the relationship between growth and age structures is likely to weaken.

Matt Nolan

Dole bludger army?

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I see that some Australian TV show host said that New Zealand has the “dole bludger army” for support in the cricket.  Now something about intimate relationships with sheep or cows, or something about little country syndrome, or something about Lord of the Rings, would have been fine – banter is acceptable.  But his statement doesn’t make any sense, and feeds into a stereotype of New Zealanders in Australia that leads to real discrimination.

So why doesn’t the stereotype hold up?  Well for one, Kiwis can’t get the unemployment benefit in Australia – they could pre-2000 but then things changed.  Just check it here.  It is common to see Australian media (and people I run into) complaining both that Kiwi’s are “stealing their jobs” and “stealing their benefits”.  In truth Kiwis are heading over there, without a security net, to work hard to make something of themselves in a larger country – they can’t get the benefits, and the idea of a zero sum set of jobs is just straight incorrect.

Secondly, within both countries there are proportionately fewer people on the dole in New Zealand than in Australia.  New Zealand produces these numbers directly, but I couldn’t find matching Aussie data.  As a result, we can just look at the unemployment rates (given they use matching definitions of what constitutes unemployment):

UR

Sure unemployment went a bit higher recently, due to the deeper recession in NZ – but on average a lower proportion of NZers are unemployed than Aussies are.

And this has occurred with much higher employment rates (% of people over 15 in work) in NZ than in Aussie.

ER

So, out of the population, a larger proportion of NZers are actually working relative to those in Aussie.

So not only was it a stupid, racist, and bigoted call – the data doesn’t even support the TV hosts prejudices.

Note:  The term dole bludger is insulting and degrading in the first place – irrespective of the relative unemployment rate.  Even if NZers could get benefits, and the UR was higher in NZ, this type of attitude towards benefits is pretty dirty.

 

Will Taylor

Incentives: parenting tweet edition

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This from @JustinWolfers is in the running for tweet of the year:

jamesz

GDP in three different charts

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Flipchart Rick has a post up about Andy Haldane’s speech the other day and, like all Haldane’s work, it’s witty and engaging so you should definitely read it. The subject is the recent slowdown in growth in the developed world and it illustrates how different views of the same data can lead to very different conclusions.

Haldane plots the last 3000 years of GDP to show what a recent phenomenon exponential growth is:

screen-shot-2015-02-23-at-18-02-36
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Matt Nolan

New Zealand’s sexiest economist 2015: Voting

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During the nomination round this year I kept hearing the same questions coming up.  Who am I supposed to nominate?  Why would I nominate someone?  How can I mix the ideas of economics and sexiness?

As this is an economics blog the vast majority of these comments came from economists or people with a strong interest in economics.  Now I’m yet to meet a person who “does” economics at either a professional or amateur level whose focus is on money or status.  Instead the interest in economics, and the corresponding study of economics, has come from an interest in understanding the social world – and a desire to understand if there is some way of making it better.

As a result, motivating nominations was easy, all I had to do was tell people to nominate an economist who has helped them to satisfy this desire to understand the world – specifically New Zealand.  What New Zealand economist has offered you insight into the world, and motivated you to dig deeper into your own understanding of the New Zealand economy and society.  That is where economics meets sexy.

With that in mind the nomination process is over.  Now it is down to you, dear reader, to determine which of these 20 economists most closely satisfies your personal definition of sexy – your choices will decide who wins “New Zealand’s Sexiest Economist 2015” (NZSE15).

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