Monday, January 13, 2014

Wood Boom .. and possibly regulating a bust.

Treehugger asked this morning "Is burning wood for heat green and sustainable?

That struck me as an irrelevant question to most burning wood, and by the end of the day I felt somewhat supported in that opinion.
Graphic from Treehugger article
The article being pointed to in the Treehugger tweet is saw was Lloyd Alter's How to use a wood stove without burning down the house:
Quite a few people living in the country use wood as their primary source of heating; If the wood is locally cut and sustainably harvested then it is a renewable resource and considered by many to be zero carbon, since the CO2 released was relatively recently stored. If the stove is modern and EPA certifed and properly installed, then the particulates are manageable.
I consider heating with wood as described above to be low carbon - but there are many issues in regulating the use of properly cured wood in efficient stoves.  The issues (with emissions and air quality) aren't problematic in sparsely populated areas, but have Montreal planning to ban wood stoves.

I'm not sure how well the planned prohibition in Montreal is being accepted, but a meeting in Fairbanks Alaska went about as I'd expect a meeting to go most regions people burn wood to heat.
Proposed pollution regulations met with opposition, hecklers at Fairbanks hearing |
...regulations, which were released last fall, include standards for wood stove cleanliness, a measure that allows the state and approved local municipalities to coordinate on air episodes, and a new provision that could allow the state to curtail wood burning during particularly bad air pollution days.
The state has held several open houses and said the regulations will leave plenty of room for people to continue burning wood, especially for those who only have wood heat or can’t afford another fuel, even when air is at its worst.
However, the general reaction to the regulations was negative.
“We’re doing this for survival. You come out and try to regulate us to death now...”
Maximilian Auffhammer's Slutsky strikes again: Greece’s air pollution problem is a new post to the excellent energyathaas blog, explaining the economics of the issue everywhere, but specifically illustrated with the current growth in wood heating accompanied by declining air quality in Greece.
The basic economics of this are somewhat simple, yet it requires going back to one of the most dreaded lectures in any intermediate microeconomics class: the one dealing with the Slutsky equation, which decomposes a price change into two effects: An income effect – essentially as one good becomes more expensive you have less “real income” available overall. And a substitution effect – which implies that for a given level of happiness you substitute away from the more expensive good. Undergraduates question each year why they have to learn this. Here is why:
The higher tax on heating oil raised its price relative to that of fuelwood. If we assume that heating oil is a normal good (which is economics for you consume more of it if your income rises – holding everything else constant), its higher price means that people are substituting away from it and are consuming even less of it because of the price and crisis induced income effect. The story for fuelwood is similar. It is the relatively cheaper good and people are substituting towards more fuelwood consumption. If it is a normal good, then this substitution effect must be larger than the income effect (as they are working in opposite directions). If it is an inferior good (which is economics for you consume less of it if your income rises holding everything else constant) then you are consuming even more of it because of the price and crisis induced income effect. Either could be the case, but I would put my money on the latter explanation. The higher your income, the less likely you are to want to chop wood and lug it into your living room.
I recommend reading all of Maximilian Auffhammer's Slutsky strikes again: Greece’s air pollution problem  - which has some interesting implications for taxing other energy options.

1 comment:

  1. A few years back the Globe carried an article reporting on research conducted at one of our national labs. The finding was that for protection of the environment there is simply no better way to heat a home than with a modern efficient clean burning wood stove. Assuming that's valid (no reason to think otherwise) then it's not surprising that that bureaucrats would ban wood burning; after all, that's what bureaucrats do, i.e. usually the wrong thing.