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The True Cost of Fossil Fuel

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We’ll start by comparing solar with the alternatives. Unless you are reading this to find out how to fix your existing system, you probably heat your water with some type of fossil fuel, such as natural gas, propane or electricity.

When you purchase fossil fuels, you do not pay anywhere near their whole cost. Because our taxes subsidize the oil companies, for instance, the true cost of gas is not reflected in the price we pay at the pump. Let us say it again: oil companies don’t pay taxes on all the money they earn, so we must all pay higher taxes to make up for it. It goes without saying that if they paid their fair share of taxes, our tax rates would be lower, and the price we pay for gas would be higher. The same scenario holds true for all other fossil fuels and electricity.

How can this be? First, the fossil fuel companies are among the richest corporations in the world, with tremendous influence in politics. For nearly a century they have manipulated the government into granting them numerous tax breaks and outright payments that are not enjoyed by any other class of corporation. The end result is that they pay little if any tax but significantly influence how our tax dollars are spent. They have managed to get the government to pay for lots of expensive research for their industry.

The costs to the environment of using fossil fuels are also hidden. Burning fossil fuels releases carbon into the atmosphere, leading to global climate changes that will disrupt life as we know it on every corner of the Earth. The costs of dealing with these changes will be astronomical and are directly linked to burning fossil fuels. When we burn fossil fuels, especially coal, we release into the atmosphere chemicals that cause acid rain, polluting our rivers, lakes and soil. Acid rain kills wildlife, trees and vegetation and degrades our buildings, roads and anything else exposed to it. Although we are already paying some of the costs to fix these problems, we are not paying them all. Eventually, someone will have to pay them.

Then there are health-related costs. Whenever we burn any fossil fuel, we release air pollutants that harm our health. Our health insurance costs go up to help pay for the care required by those most affected. Our taxes are increased to help pay for those who cannot afford their own care, and our general health care costs go up for the same reason. Again, we do not pay these costs at the pump or with our utility bills.

Some of our electricity is generated in nuclear power plants. The waste generated by these plants is one of the most toxic substances known to humanity. We have no clue how to safely dispose of it. We can send people to the moon, but we have not figured out how to deal with these incredibly toxic waste products. Undoubtedly, if we do figure out a way to safely dispose of them, it will be incredibly expensive. This cost is not included when we pay our electricity bill. We also invite you homeowners and renters to read the fine print of your insurance policies. Note that if there is ever an accident involving nuclear fuel or waste, your insurance policy does not cover that. Ask the people living around the Three Mile Island nuclear power plant, whose lives were devastated by the nuclear accident there, how they feel. We will guarantee you that they are not happy. Many lost everything.

Assigning a true cost to the use of fossil fuels relates directly to solar water heaters and any other renewable energy system. Admittedly, it costs money to invest in renewable energy equipment. Often, people will look at that cost and say that it is just too much more than using fossil fuels. When you get to this point, please remember the above discussion. How much higher should the costs of fossil fuels really be? Twice as expensive? Three times? Four times? Experts who have spent considerable time researching this issue have calculated that these costs are five times more than the bill we pay at the pump or meter.

While these true costs are not reflected in our bills, we do see that the price we pay tends to increase every year. In order to understand where fossil fuel prices are heading, we first have to understand what has happened in the past. Having a handle on energy price inflation is basic to understanding the economic impacts of investing in solar thermal energy systems.

Solar Water Heating--Revised & Expanded Edition

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