The Tax on Energy in the Future






In a very reductionist way, the origin of States implies a social contract where citizens choose to form a government that maintains order and fulfills other obligations for their benefit. To achieve this, human and material resources are required that must be covered with economic resources. Said in another way, governments need money to fulfill their tasks.

Governments have very limited ways of obtaining money. The most important and central one is taxes. That is, the imposition of participatory quotas on citizens, whether as individuals or as corporations, to maintain the actions of the government. The greater the tax burden, the more activities the government can develop optimally. However, it is a widely accepted consensus that citizens do not like paying taxes.

Another way in which governments can obtain income is through public debt, which is nothing other than obtaining money in advance that, in the end, will have to be paid with the government’s own income in the future. Debt is also very unpopular and dangerous because resources are committed in the long term to maintain payment to creditors.

In Mexico, however, an important part of public spending depends on two sources: oil revenues from the product of the sale of crude oil and taxes on fuels. As part of flexibility strategies, the Mexican government established a strategy based on establishing incentives when the price of gasoline was high, which were absorbed, in some way, by oil exports.

In recent years, the price of oil had remained relatively low —below 50 dollars per barrel— so, to maintain public revenues when the price of crude oil was low, the incentive to gasoline was reduced. This helped maintain the income not obtained from the sale of crude oil.

Consider that the use of oil causes serious problems related to climate change. Therefore, one of the logics of taxing fossil fuels is to dissuade their use in the long term to avoid their negative externalities or else to develop policies that allow correcting the consequences; for example, to adapt societies to climate change.

However, if one of the trends in the future is decarbonization, that would mean that taxes on fuels could disappear; with this, government revenues would decrease. Then, if fossil fuels are replaced by renewable sources of energy, how could said income be recovered?

Some proposals that have been debated in some countries regarding this topic are to tax, for example, electricity, batteries or even hydrogen. The logic behind these new levies would not be externalities, but collection itself.

Then, it would be possible that in the future, we see an IEPS on electricity, which by the way, this possibility has been established in the Constitution for some years. Perhaps, then, we could see taxes on the sun as in Spain some years ago or perhaps taxes on hydrogen as were recently approved in Argentina.

The challenge is that these taxes be progressive and that they do not condition the energy transition; at the same time that they allow governments to obtain the necessary resources for their continuous operation in the long term. For the moment, let this text serve to encourage the debate regarding the tax on energy in the future.

This article was originally published by Business Insider México.
Date: January 19, 2021
Original Link: https://businessinsider.mx/impuesto-energia-mexico-futuro-opinion-paul-sanchez-energia-circular/ [offline]
Archived Link: https://web.archive.org/web/20240222173025/https://businessinsider.mx/impuesto-energia-mexico-futuro-opinion-paul-sanchez-energia-circular/ [Archived]

Cemetery for Renewable Technologies






I shared with you in a previous installment that the waste of the future has to do with the technology that is used. Just as today we see dumps of tires or technological waste —such as computers and cellphones—, in the future we could be witnesses of dumps of solar panels and batteries. If this is a possibility, then, should we not be planning a cemetery for renewable technologies with the purpose of conducting them in an appropriate and sustainable way to their final resting place?

It is expected that in the coming years there will be a boom regarding distributed generation on rooftops. For example, San Francisco has already passed a law that prevents new residential constructions from using fossil fuels. If this trend continues, the solar panels and batteries that will be part of the everyday landscape of the future must be disposed of responsibly.

This cemetery of renewable technologies is not a conventional dump; because it requires a recycling and treatment process to, first, reuse the greatest possible part of the discarded materials; second, to dispose of in a sustainable and adequate way the waste that can have a negative impact on the soil and the environment.

Regarding solar panels, conventionally more than 75% of these is glass that can be recycled without much problem; 10% is plastic, 10% metals and 5% silicon. Perhaps the greatest value of recycled panels is the metals, which are mainly aluminum, silver and copper. Although aluminum is easy to extract, silver and copper require more complex chemical processes that can reduce the recovery of plastic and glass.

Batteries, for their part, can have a somewhat more complicated process because, although they have iron, aluminum, plastic and copper, there are also chemicals in liquid state of lithium, nickel, cobalt and other substances. The final disposal of batteries is more complex than that of solar panels since the cells represent chemical risk that can derive in fires and burns; poisoning by toxic substances in the environment and causing cancer.

In this way, the cemetery for batteries must be much more careful since the greatest part of the materials must be recovered through physical, chemical separation and by means of heat; subsequently, safely storing those substances that represent risks to the health and safety of communities.

The recycling and final disposal of renewable technologies, due to their complexities, is not a cheap process. Despite this, it is rarely considered in the budgets of installers, leaving under the protection of the final consumer the responsibility of replacing and safely disposing of these components.

This, at the end of the useful life of the technology, would represent a cost not considered at the moment when the renewable solution was budgeted. In this sense, the real savings would be adjusted downward and in a single exhibition, which would imply allocating more resources for the removal and disposal of the technology.

For these reasons, in Europe the extended responsibility of the producer has been promoted, which requires all producers to consider in their prices and within their responsibilities the removal of solar panels and batteries that are installed in homes, businesses and other buildings; with the purpose that the final cost also reflects the cost of getting rid of these technologies when their useful life ends. In Mexico, we are still in time to promote the extended responsibility of the producer and the minimum standards to dispose of renewable technologies —this cemetery for renewable technologies—, before it becomes a public problem that gets out of our hands. At the end of the day this is the principle of circular energy.

This article was originally published by Business Insider México.
Date: November 25, 2020
Original Link: https://businessinsider.mx/cementerio-tecnologias-renovables-opinion-paul-alejandro-sanchez-energia-circular/ [offline]
Archived Link: https://web.archive.org/web/20211023143433/https://businessinsider.mx/cementerio-tecnologias-renovables-opinion-paul-alejandro-sanchez-energia-circular/ [Archived]

“Are You Still There?”: Why That Screen Appears When No One Is Watching the Series






More than one has done it. We are working, preparing food and we have a Netflix series or some other streaming service in the background. Sometimes we return to watch the program, but other times we continue working, talking on the phone or we even fall asleep while the series runs and runs, functioning as ambient noise. This is not uncommon, it is done a lot and more in these times of working from home. To prevent this from continuing persistently, media companies such as Netflix and YouTube implemented the “Are you still there?” button.

Of course, many of us see this button as a nuisance after the fourth or fifth chapter of your favorite series, when you want to see what happened with the plot after the previous episode. But why is it important? And, above all, what does it have to do with energy, the topic we address in this space.

This button exists because if it were not so, we would surely leave the television on ad infinitum. When we addressed the topic of light pollution, we concluded that when the consumption of an additional unit of something does not generate a cost for you, or the cost is not perceived in the short term, the consumer will tend to increase their consumption. But the fact that it does not cost you does not mean that it does not cost YouTube or Netflix for the series to run while you fall asleep.

This is because the series of these platforms rest on servers that require energy to be available at all times. And, the greater the intensity of consumption, the more intensity of processing is generated, which requires more energy, on the one hand —because the server is in active operation all the time—; on the other hand, because they generate heat that requires more energy to keep the rooms where said servers are cold.

In recent years two phenomena have occurred; the first, the energy consumption of the cloud, that is, the servers of data companies such as Google, Microsoft, Netflix; Amazon and Dropbox, among others, has increased. Nevertheless, the second effect is that energy consumption has become more efficient per unit of work performed. This means that every day more energy is consumed to maintain digital services in the cloud, although much progress has been made in energy efficiency.

In that sense, the idea behind the “Are you still there?” button is not because Netflix cares about you, it is a measure of consumption efficiency and, at the end of the day, of energy efficiency. This is because if all of us left series running all the time, surely the company’s energy consumption would increase.

But not only that, greenhouse gas emissions would also increase, both those that you cause through the consumption of your series at home, and those of the company for keeping its servers operating in an inefficient way while no one is watching TV. We will go deeper into that next week.

However, not everything is bad, this could also be good for you. Because to the extent that you are more conscious of your energy consumption at home, you will avoid surprises in your electricity bill every two months, with which you save electricity and contribute to mitigating climate change.

So remember, if you have the habit of waiting until the server asks you “Are you still there?” and you are really not paying attention to the series that runs incessantly, perhaps it is time to rethink your energy consumption for the good of the planet and of your pocket.

This article was originally published by Business Insider México.
Date: November 11, 2020
Original Link: https://businessinsider.mx/sigues-ahi-boton-ver-series-netflix-streaming-opinion-energia-circular/ [offline]
Archived Link: https://web.archive.org/web/20211204081743/https://businessinsider.mx/sigues-ahi-boton-ver-series-netflix-streaming-opinion-energia-circular/ [Archived]