ABSTRACT
Limitations to conventional methods of evaluation We are happy to pay tribute to those who have achieved the methods of measurement of our civilisation that have stood so many tests and trials. In particular, accountants have been responsible for the meticulous following of events by methods of monetary measurement which have stood the test of time, and economists have succeeded in replacing the ‘old craft guilds unsophisticated rules of fairness with a system including such fascinating concepts as “alternate use” which stand us in good stead in our complex society. Yet it must be agreed that these systems of evaluating and carrying out transactions fall down in a number of ways. Internationally, the frayed edges of monetary transactions show where national or other groups find it necessary to revert to threats of war, or war itself, to achieve their aims. Whether directly concerned with energy matters or not, there can often be a major energy impact, as in 1979 with the change of Government in Iran and the consequent effect upon world supplies. Nationally, the UK is a clear example of price being unable to reflect the relative merits of fuels. There is widespread understanding that natural gas supplies are of limited duration and that gas has special qualities as a premier fuel for selected applications. It should therefore be thus preferentially used and be an expensive fuel for other purposes. In practice gas is a cheap fuel for many industrial furnace applications though its special qualities are unnecessary. At a business level, the price mechanism again has difficulties. An example of this is the business with a number of processing plants in different parts of the UK. Such a business will find that electricity and other fuels are provided at different prices according to the factory location. Thus in carrying out its load-balancing operations between sites it is moved to use less efficient plant (therefore more electricity or other fuels) because price differentials give a better economic answer for the company through the use of less efficient equipment. Electricity is particularly worth a mention since, ironically, there are vast movements of electricity supplies through the grid to achieve the very load-balancing efficiency pattern which is then denied industry through the price mechanism. Domestically, price as a mechanism is thwarted in ways that can hardly be dear to the hearts of either accountants or economists. There is still considerable practice in more rural areas of burning wood which is obtained for no price at all, or perhaps by barter. This might be an intelligent use of resources although a great deal of time and effort is spent by environmentalists acclaiming that wooded areas should be left in a natural state.
