February 18, 2009

$787,000,000,000 later...

So HR-1 was signed into law by President Obama and everyone (including those who wrote the law) are still trying to figure out exactly what we're getting for the $787 Billion. Here's what I would have done with a blank U.S. Treasury check:

In the spirit of the New Deal and "a chicken in every pot", I would have installed a geothermal heating/cooling system for every home in America.

First, some U.S. census data. In 2001 there were 107 million households in the U.S. http://www.eia.doe.gov/emeu/recs/recs97_hc/t1_4a.html

It is estimated that there are now 114 million households in the U.S. broken down as follows:

78.5 million (1 family dwellings)

10.1 million (2-4 family dwellings)

18.1 million (5+ family dwellings)

7.2 million (mobile homes)

For the first phase of the project we'll need to discount the mobile homes for now (as geothermal systems are buried into the ground and the vast majority of mobile homes rely on electric heating).

This leaves us with 106.8 million dwellings to provide a geothermal system with.

What is a geotheremal heating/cooling system?

Here it is in layman's terms. The temperature of the earth just 6 feet below the surface is a consistent 55F year round. That means that it's warmer than the air temperature in the winter and cooler than the air temperature in the summer.

A geothermal HVAC unit is a nearly perfect system. It uses the earth's soil year-round to heat your home in the winter and cool your home in the winter. You reduce carbon output by burning less fossil fuels and you increase your budget by purchasing less energy from your corrupt utility company.

Pipes connecting the water heater are drilled into the ground and are the returned to the heater.

In the winter, cold water is heated by the earth's 55F soil and is used to help heat the home.

In the summer, the system naturally works in reverse, using the Earth's 55F soil to cool the house.

The expected energy savings are 70% for heating and 50% for cooling. This proposal combats at least four major issues facing us today:

1. Puts Millions to work in
A.) High-skilled jobs designing the systems
B.) Medium-skilled jobs installing the systems
C.) Low-skilled jobs manufacturing the systems.

2. Puts Billions in the pockets of Americans who would now have lower utility costs.

3. Helps the planet's ecology by offsetting America's daily carbon output.

4. Re-instates the U.S. as a the world's leader in matters that are righteous and just.

What's all this gonna cost?
The average geothermal system today (including installation) costs roughly $20,000. The majority of the cost is the actual drilling. But as with all major infrastructure projects, there will be deep average discounts due to "economies of scale".

For example, an excavation company may ordinarily charge $9500 for the excavation on a geothermal installation for one house. But if that company were asked to submit bid on an entire block of say 35 houses, the average cost for each excavation may be only $6000 for each excavation. That's called 'economies of scale'. Likewise, the per dwelling cost will be lower for a 50-unit apartment building than it would be for a rural one-family home.

So, for argument's sake lets say that the average (per dwelling) cost on a project of the magnitude will be $12,500.

Take the $787 Billion (that may not stimulate anything but talk of 'what might have been') and DOUBLE it. Yes double it.

Proposed Geothermal Stimulus package: $1.574 Trillion
$12,500 (cost per system) x 106.8 Million dwellings = $1.335 Trillion
Surplus: $239 Billion

Remember those 7.2 Million mobile homes we neglected before? Well each of them gets photovoltaic solar system.

Proposed Mobile Home Solar Stimulus package: $239 Billion
$239 Billion / 7.2 Million mobile homes: $33,194 each

This would pay for a 3,000 kW photovoltaic solar system installed. While I'm not crazy about the current solar products (huge batteries must be disposed of after 15 years) it is far better than the dirty utility company electricity.

If Washington were serious about Reinvesting in America, this is how to do it.

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