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01/27/2009

Gift Cards For Purchasing Electricity

(Submitted to BarterNews by Robert Hahl of Kilowatt Cards.)

Kilowatt Cards are gift cards that can be redeemed to pay for 10 kilowatt-hours of electricity in any residential utility account, almost anywhere in the world. Electricity companies don�t accept them, but they do at www.kilowattcards.com and then send payments directly to the power companies at the rate they normally charge home customers for the same amount of electricity, including taxes and fees. These gift cards are supported by the non-profit Kilowatt-Hour Card Corporation (KHCC).

Kilowatt Cards are backed by goods, not promises. They are issued in exchange for assets (e.g. firewood, food stores) then held by a non-profit corporation, and later sold to pay for electricity as the cards are redeemed. They can be redeemed for electricity worldwide, resulting in a store-of-value (goods) and medium-of-exchange (electricity).

Because energy is needed to produce or to use all goods and services today �the ability to consume electricity� is a meaningful definition of wealth. While some people want gold and silver, everybody wants light, heat or transportation. Kilowatt Cards show that paper notes can be redeemed for something useful. But KHCC does not produce or deliver the electricity; they only pay for it with national currencies, supported by investments.

One purpose of Kilowatt Cards is to promote stable commerce and reduce the boom-bust financial cycle, by letting people save and lend their wealth in a form which cannot be diminished by currency inflation. If electricity cards stay redeemable at face value they cannot loose barter value as energy.

Traditional currencies have the attributes of being: (i) portable, (ii) difficult to counterfeit, (iii) limited in supply, (iv) non-perishable, and (v) easy to recognize. While electricity itself meets none of these criteria, electrical capacity meets criteria (ii) to (v), while paper cards representing payments for electricity supply attribute (i).

Kilowatt Cards are gift cards not currency, but since they will pay for anyone�s electricity, they are useful to barter for other things � and as a store of value, worth a fixed amount of energy, regardless of electricity prices.

They have fixed value because 10 kilowatt-hours is a physical constant � a standard amount of work (in the scientific sense) that one can evaluate intuitively: 10 kwh = 10,000 watt-hours, enough energy to run a 100-watt light bulb for 100 hours (exactly), and roughly enough to drive a Toyota Prius 25 miles. The typical price for 10 kilowatt-hours is about US$1 to $3.

For more information see www.kilowattcards.com.



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