Keeping Warm While Paying Too Much
With winter rolling in, and the price of energy ballooning in part because of Russia's invasion of Ukraine, students are facing more costly electricity bills alongside increases in cost of living due to inflation.
In France, gas prices are being capped at an increase of 4% in the second part of 2022, extending price caps introduced after the invasion. Still, this means an average increase of €25 per month for households that heat with gas, with French Prime Minister Elisabeth Borne saying that new gas caps would take effect in January, with new electricity caps following soon after.
Another day of sky high electricity prices in Europe, particularly in countries like France and Spain. For the later, it's the 4th highest day-ahead power price ever. European politicians who hoped for lower prices are beginning to realize that the winter has yet to start pic.twitter.com/6eHWLVEZmF
— Javier Blas (@JavierBlas) November 18, 2021
For the AUP community, this energy cost increase means students are finding tactics to keep their energy bills down.
Some students say they're taking steps to reduce their energy consumption at home. “I use way less heating and I’m careful when running the dishwasher or the washing machine, making sure I only use it when I really need it,” said Carolin Sibel Welhelm, a senior at AUP. Another student, Hana Helfand, a junior, said she likes to use blankets and sweatshirts to avoid keeping the heat on, and she only leaves the light on in the room that she is in.
Some students also suggested using an electric blanket to keep warm during the winter. The blankets use less energy than heaters do, and they can allow you to turn down the thermostat during the night, saving some money on heating.
Other students said they had different priorities when thinking about energy use, though. “I don’t specifically do anything to lower my energy consumption at the moment," said Irina Lachkar, a French student. "I’m more interested in the environment and animal protection. But I usually am very careful with how much water I use during the day, I try not to take baths too often. My heating hasn’t worked for some time, so now that its fixed we are enjoying it cause we are cold at home."
In France, the EDF is rolling out an option for consumers called the Heures Creuses, which is a program that will allow customers to pay two different rates for their energy prices; a slightly elevated rate for times of the day when energy consumption among the public high (between 8 a.m. and 12 p.m., and 5 p.m. and 8 p.m.), and a slightly lowered rate at all other hours, when energy consumption is generally lower. The idea is to encourage households to use energy-intensive appliances at times that are off peak hours to keep energy peaks from causing shortages.
Energy isn't the only thing that has gotten costlier in recent months - the price of gas has also gone up. Though it isn't typical for AUP students to drive regularly in Paris, increases in gas prices still have effects on cost of living because it means that food or other goods are more expensive to ship from one place to another. And in addition to gas prices going up, certain foods have also seen increases, such as sunflower oil and wheat, which are both staple products in Ukraine. In past years, the country has provided around 16% of the world's corn and around 40% of the world's sunflower oil, and it's been a major wheat producer, providing up to 90% of the wheat consumed in some countries. The war in Ukraine has meant that food production is down and transportation for goods that are produced is significantly costlier.
A wheat field in Cherkasy Oblast, Ukraine (Image Credit: Unsplash/Eugene)
To keep food costs down, some AUP students have found ways of buying groceries at reduced prices. Sarah Cronin, an AUP student, said that she's been using the app "Too Good to Go" since November of 2021. "I usually use it for my groceries a couple of times a week," she said.
The app, headquartered in Copenhagen, is designed to reduce waste from grocery stores by allowing them to sell food that is near it's expiration date at a reduced price. Users buy selections of food, generally without knowing exactly what they'll be getting, at prices that are greatly reduced from their original costs.
"I love eating fresh produce, and when I lived in [the] Champs-Elysées the groceries were crazy expensive and I wanted to find a way to find a lot of produce for cheap," said Cronin. "The great thing about it is that you can narrow down what kind of food you want to get and groceries stores will offer entirely fruits and vegetables, so it's totally by surprise. One day I got a 5 pounds worth of groceries for two euros. The main thing is that you have to pick it up at the groceries store, it's not delivered."
There isn't a general consensus from economists on whether or not high inflation rates are temporary or will be longer-lasting, but some argue that the worst of inflation is behind us.
"The signals emanating from the front end of the economic pipeline paint a clear picture of disinflation (slowing rates of increase) almost everywhere, and outright deflation (absolute price declines) for many key inputs, including energy, food, and commodities," wrote George Calhoun, a US based director of the quantitative finance program, and of the Hanlon Financial Systems Center at the Stevens Institute of Technology, in a recent Forbes article. "Inflation is already ending. It was, indeed, supply-driven, and transitory," he argued.
