The Not So Transparent Costs of Electricity

22 Aug The Not So Transparent Costs of Electricity

Generating power is a complicated process from its inception as a fossil fuel to its end product as electricity, whose final destination is to the consumer.  Our grid system is archaic and in serious need of an overhaul.  Transforming the grid can reduce overall costs and pollution.  Not to mention that solar can improve the security of the grid and leave us less susceptible to cyber or physical attacks on them, which can have serious repercussions on our way of life due to blackouts and the like.

Traditional means of obtaining electricity is through the use of fossil fuels.  The biggest costs associated with this include the extraction, conversion, and transportation of the fuel.  Other costs include the operation and maintenance of the power plants and any waste product management associated with extracting energy from fossil fuels.  With renewable forms of energy such as solar and wind, the only costs associated include the production and transportation of the solar panels and turbines.

There are costs associated with the production of electricity that are not generally passed along to the ratepayers.  These external costs include the cleanup of toxic spills from power plants, which can endanger human and wildlife health and cause damage to the environmental landscape.  The price paid for electricity by ratepayers does not reflect the true cost of obtaining it.

Origin of Fossil Fuels

Energy is extracted from fossil fuels (coal, oil, and natural gas).  Fossil fuels are formed from the remains of small plants and animals that died and accumulated in bodies of water millions of years ago.  Layers of sediment would form on top of the remains, wherein heat and pressure would transform the fossils to either coal, oil (petroleum) or natural gas, depending on whether it is more liquid or gaseous.  Since the decomposition of organic matter takes thousands of years to evolve, our consumption may eventually overtake the supplies of fossil fuels available now.  This is why renewable forms of energy such as solar and wind are so vital to our future.

The Four Segments of Our Electricity System

  1. Generation
  2. Transmission
  3. Distribution
  4. Consumption

The generation of electricity stems from power plants.  Coal, oil or natural gas are burned to produce electricity.  A furnace is used to release the heat energy from the fuel.  The boiler uses the heat from the furnace to boil water into steam.  Steam powers the turbine to convert its energy into kinetic energy.  A cooling tower is used to start the condensation process by way of cooling the hot turbine with water.  Then a generator produces electricity by using the kinetic energy from the turbine.  The electricity then flows from the generator to a nearby transformer.

The transmission of electricity is through transmission lines.  These lines carry the electricity from the power plants to electrical substations and then to customers.  There’s a transformer from the power plant that steps up the voltage to the transmission line so that it can reduce the amount of energy lost during long-distance transmissions, and then moves to a local or neighborhood transformer, which then steps down the voltage before heading to the distribution lines to its final destination of the customer.  The substation is where transmission moves to distribution.

The distribution of electricity is through electric wires set up by local utility companies.  These electrical wires make it possible to obtain electricity from faraway places.  The wires are set to each residence.  A step down transformer located near the customer reduces the voltage of electricity before being transmitted to the customer.

The consumption of electricity is when consumers initiate the demand by powering their technology.  Electricity flows through a meter installed at a residence so that it can measure and bill for how much is being used.

Environmental and Health Costs

There are costs associated with the production of electricity that are not generally passed along to the ratepayers.  These external costs can impact the economy negatively, as well as being harmful to the environment.  An example of an external cost is the cleanup of the pollution that is released from power plants when producing electricity.  The damages that incur from the burning of fossil fuels are costly to the environment and to the health of all living things.


Coal-fired power plants are the largest producers of greenhouse gases.  Coal is burned to release the energy that is trapped inside.  This energy is what was absorbed by the plant or animal from the sun thousands of years ago, which just goes to show that solar has been and always will be the greatest form of energy available.  Burning coal produces steam to turn turbines to generate electricity.

Power plants (a.k.a. generators) adversely affect the health of residents nearby due to the amount of pollution that they release.  Coal burning power plants leave behind coal ash, which is a harmful waste product that could cause significant ramifications in terms of cost and cleanup.  Coal ash is dumped into pits or ponds by power plants.  There have been many instances where spillage of coal ash has contaminated water vital to communities.  Water contamination affects the health of people, as well as any microorganisms that happen to live in those bodies of water.  The plants also use massive amounts of water from nearby water resources to extract and wash coal to remove impurities, as well as acting as a cooling mechanism for the steam produced to make electricity.  What water is not used by the power plants is returned to the source, but in a contaminated state that threatens the ecosystems and health of those who use it.

Coal mining is a dangerous and arduous undertaking.  This also poses serious health risks and costs to the miners who extract coal for a living.  In underground mining, there have been many instances where mines have collapsed, trapping workers inside.  Although surface mining or open-pit mining is safer because it is less than 200 feet below the surface of the Earth, it still has negative aftereffects such as dust pollution.


Drilling deep into the ground is required to obtain oil.  The crude oil must then be refined before it can be used as fuel (gasoline, diesel, heating oil, and electricity).    Drilling for oil has severe environmental impacts that are hazardous to all living organisms as it affects the air, water, and land.  To generate electricity, oil is burned to release hot gases to spin a turbine.  However, the burning of oil releases pollutants and greenhouse gases affecting air quality.  Oil accounts for thermal discharge, where water is cycled through repeatedly for the cooling process of the plant before it is released back to the source from where it was drawn.  The temperature of this water is now altered and can significantly impact the aquatic ecosystem by harming or killing it.  Oil also creates hazardous waste, which endangers land.

Natural Gas

Natural gas requires drilling to tap into its reservoirs through a method called hydraulic fracturing (a.k.a. fracking).  Fracking is the process of drilling down into the earth and using a highly pressurized amount of water to “fracture” the rock to release the gas inside.  Natural gas is then brought through pipes to access it.  It is then burned to produce hot gases used to spin a turbine, which powers the generator to convert the energy into electricity.  Natural gas is the cleanest of the fossil fuels because it releases fewer harmful emissions.

Natural gas plants, although minimally less harmful than coal plants, do not surpass solar in terms of environmental benefits and cost savings.  Fracking can cause well-water contamination, thus affecting the drinking water of communities in that area.  Also, when natural gas is burned, it releases impurities such as Sulfur and butane, which can impair air quality.

Solar as a Clean Energy Alternative

Solar power is a clean energy, as no harmful emissions are released from its production.  It also doesn’t contribute to climate change.  Solar will help our country become less dependent on fossil fuels and become sustainable.  It is a free form of energy readily available anywhere in the World, and doesn’t require many of the exorbitant costs associated with obtaining its power.  Solar does not release harmful emissions impairing air quality nor does it contaminate groundwater.  Besides the environmental factor, falling prices of solar panels and its key components also make going solar much more attractive.  Naturally, solar has been viewed by utilities as a threat to the status quo.

Although some strides have been made to curtail the harmful emissions produced from the use of fossil fuels, such as utilizing waste coal ash to create cement, more needs to be done to slow down climate change.  The goal is to make this planet livable and healthy for future generations to come.  No fossil fuel is as economically sound as solar or any other renewable form of energy.

We need to embrace solar power production as the alternative to fossil fuels now in order to set ourselves up for a stable energy infrastructure.  There is no telling how much fossil fuels will be available for use in the future.  It would be catastrophic for our way of life if we were suddenly plunged back into the dark ages.  Renewable energy sources are the keys to ensuring our future.  We need to release the choke-hold that utilities have by demanding radical change for our grid infrastructure.  Changing the current grid infrastructure is how we can make a significant difference in the future.

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