I have recently come across a very practical example of a kind of "tragedy of the commons" - the unwillingness to invest in assets that benefit stakeholders indiscriminately. Specifically, on large strata-title apartment projects there is a reluctance to implement such measures as:

- central hot water heating (~ 10% lower all-up costs, ~20% lower operating costs)

- Solar hot water heating (>20% ROI)

- Solar electric power (~10% ROI)

UNLESS some kind of user-pays system is implemented, which would use up pretty much all of the gains.


The concern is of course that providing the above systems would create a "commons" that would tend to be exploited.


I am curious if there are any ideas on a usable solutions, perhaps some kind of workable protocol that would enable the above, or existing success stories - what made them work?

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Maybe the abuse could be limited, if the exploitable commons is connected with something you have to pay for. For example, imagine that you provide free water. Then there is a risk that some asshole will just let the water flow freely, just because they can, or because they are excited by the idea of abusing the system, or just because their water faucet broke and they don't bother fixing it. Such an asshole could create potentially unlimited damage.

On the other hand, imagine a system where you pay for water, but you get the cold water converted to hot water for free. Even if there is a similar asshole in this system, who on principle uses hot water even when they really need cold water, their damage is limited, because although they don't pay for the heat, they still have to pay for the water, so their budget for water limits the damage. -- At the end, even if you know you have one such asshole and you cannot stop them, using this system could still be cheaper for everyone. So, estimate the ratio of sociopaths in your society, and see if the project still economically makes sense.

That's an excellent point! Lets just do some maths:

Water cost here is $2.00/m3

Cost of heating 1000 kg of water 20-->60 deg with gas@ $0.02/MJ: ~4010004*.02/1000 = $3.20 (this is central, individual would be abt double)

So the cost of heating is not far from the cost of water... I think this could work.

Thanks, I will try this and see how it turns out. Might report back in a month or so!

I think you might be wrong when you say that paying is central. I would guess that monitoring is much more important. If you waste resources and your neighbors know that you waste resources that can encourage you to use less of them even if you don't have to pay for your resources.

I know that in Berlin there are projects where the government solves the issue with public-private partnerships. If the government would pay 1000 per year to heat a particular building it might do a contract with a company to pay the company 900 per year and let the company pay for modernisation that cuts the costs to 800 per year. The private company makes money from the difference of 800 to 900 while the government has to only pay 900 instead of 1000.

If you do have the capital to finance a >20 ROI water heating improvement you might do a deal with the apartment project where everyone wins. If you can do that while really having a 20 ROI you are going to make a fortune.

Now I understand what this post is about. In Germany it is standard that individual use is monitored.

The problem is that the cost of installing say individual hot water meters to each apartment would more than eliminate the upfront savings, and reading the meters and doing the paperwork would eat up the operating cost savings.


I would be suggesting heading towards the dark arts;

where you might be trying to encourage ROI for upfront asset sacrifice (pay now, reap the benefits later) you can put off the upfront sacrifice by taking out a loan and gradually paying it off - thereby doing a (pay over time, reap the benefits over time). It would decrease your ROI but also decrease the upfront hesitations over cost.

I would be modelling the thoughts of those who don't want to pay up as: (Opportunity cost of paying now) > (Return over time)

especially when you consider that not all members of a strata will be the same members to reap the 20 year return... Also considering that people are probably not expecting the increase in energy prices, and also the cost of a solar system might go down in the future...

Another problem you need to avoid is misjudging how much money you would actually save. That seems more common when the pain of misjudgment is shared.