Should Energy and Credits be different resources?

[Mastikator]

The problem with money is it is not a resource. It's a medium of exchange and store of value. The only "benefit" of using a fiat currency is that the government can create it and effectively borrow money from the future, this approach is basically a "kick the bucket down the road until the system collapses" which is appealing to short sighted people and not so much to people that aren't.
Energy credits on the other hand is money that is backed by a resource, when you fix money to a resource the value of money fluctuates with that resource but since energy is always valuable and is always what is used to create every other resource and maintain everything the money becomes universally valuable too without being a fiat. It's actually a brilliant system.

 

[Chthon]

Actually, the same can be said about energy. How much value does a trillion gigajoules of stored energy have if you're stranded on an lifeless planet and about to run out of food? Energy only has value if you can do something with it. The same is true about time, by the way. People say "time is money," but that statement is not literal - we can't sell the two hours we're stuck at the airport, nor can we buy back the hours we wasted on internet forums for any amount of money.



Nothing has "static value," because the economic value of something depends not just on what you can physically do with it, but on what you can exchange it for, and what you can exchange it for depends on how much there is and how much people need (supply and demand). Things only have value relative to other things. Sure, the physical properties of the energy itself stay more or less the same no matter where you are. But that's not the same as it having the same value, because the actual work you can do with it doesn't have the same value. That acceleration to 30mph you mentioned might be very useful in some places and worth nothing in others. A huge pile of energy is very valuable if you're surrounded by machines that can turn it into useful work, and worthless if you're on a broken ship billions of miles from civilization.

These are extreme examples, but they illustrate the point that energy, just like everything else, has a value that goes up and down depending on circumstances. What makes energy a bad currency is that (setting aside portability issues which technology might solve) its value goes up and down frequently and unpredictably. It's like using dice to determine your economic policy.

If you could directly convert energy into matter of any kind and in any shape, then yes, you could "trade" energy for any (physical) thing. But even then it wouldn't have a static value, because its value relative to various services and intellectual property would be variable.

That's completely false. Energy has a static value because to do any amount of work, you need a prescribed amount of energy.

Do not think of energy credits as stored electricity, that is where your fallacy lies. Energy is simply the ability to do work. In our world, a barrel of oil might be an energy credit, but we don't need to turn that into electricity to do work. We can instead use that in an engine to directly convert it to energy.

The value of energy credits is based solely on the conversion of energy to work, which is a constant, thus energy always has a static value.

Your examples fail to grasp one thing as well, if I were on a broken ship in the middle of nowhere starving to death, energy still has the same cost, but food to me would be worth so much more. This isn't a devaluation of energy, but a much greater valuation of food. In your example, the value of energy hasn't changed at all, it's food that changed.

 

[SectorsAreOkay]

The problem with money is it is not a resource. It's a medium of exchange and store of value. The only "benefit" of using a fiat currency is that the government can create it and effectively borrow money from the future, this approach is basically a "kick the bucket down the road until the system collapses" which is appealing to short sighted people and not so much to people that aren't.
Energy credits on the other hand is money that is backed by a resource, when you fix money to a resource the value of money fluctuates with that resource but since energy is always valuable and is always what is used to create every other resource and maintain everything the money becomes universally valuable too without being a fiat. It's actually a brilliant system.

This is probably closest to correct. Energy credits seem to be some sort of commodity-backed money: https://en.wikipedia.org/wiki/Monetary_system#Commodity-backed_money.

 

[OrigamiPhoenix]

I will be "that guy" and point out that energy would be a hideously terrible thing to use as a currency, for any civilization at any level of development, because the price of energy is extremely unstable, varying even with the weather. If you ever want an economist to look at you with a mixture of horror and confusion, suggest that we go back to fixed exchange rates, but pegged to the price of oil instead of the price of gold.

Can you just imagine the madness of a future economy using energy credits? Inflation every time new power plants are built. Crippling money supply shortages every time the fleet mobilizes for war. A catastrophic collapse of the value of your entire life savings every time a new type of power generation technology is developed. The dyson sphere being turned on and immediately ushering in the Great Galactic Depression. Just look at the basket-case economies of real world countries that rely too much on oil exports to fund their society and you'll get just a fractional glimpse of how insane it would be.

I realize that energy credits are a common sci fi trope and that Stellaris is about trope fantasy fulfillment, not realism, but it's still a really dumb trope. I'm much more comfortable when they violate the laws of physics.

I think that energy credits are supposed to be more like Glimmer ala Destiny: A catch-all for a space-age liquid currency.
Not saying you're wrong, but at least it makes more sense that way.

That's completely false. Energy has a static value because to do any amount of work, you need a prescribed amount of energy.

Do not think of energy credits as stored electricity, that is where your fallacy lies. Energy is simply the ability to do work. In our world, a barrel of oil might be an energy credit, but we don't need to turn that into electricity to do work. We can instead use that in an engine to directly convert it to energy.

The value of energy credits is based solely on the conversion of energy to work, which is a constant, thus energy always has a static value.

Your examples fail to grasp one thing as well, if I were on a broken ship in the middle of nowhere starving to death, energy still has the same cost, but food to me would be worth so much more. This isn't a devaluation of energy, but a much greater valuation of food. In your example, the value of energy hasn't changed at all, it's food that changed.

Yeah, that's entirely missing the point of how energy is produced and used in any civilization, let alone a galactic one. Energy always varies in efficiency, scarcity, and utility, therefore it always varies in value.

 

[Chthon]

Yeah, that's entirely missing the point of how energy is produced and used in any civilization, let alone a galactic one. Energy always varies in efficiency, scarcity, and utility, therefore it always varies in value.

No, I think you're the one missing the point. Efficiency is handled by tech that make your technicians produce more. Scarcity is handled by you not having energy credits. Utility is constant because 1 MJ of energy will perform 1 MJ of work. Perioud. Because of this, the price of energy credits are constant.

 

[wingren013]

But the value of 1 MJ of work is not constant.

 

[OfficerBrennan]

No, I think you're the one missing the point. Efficiency is handled by tech that make your technicians produce more. Scarcity is handled by you not having energy credits. Utility is constant because 1 MJ of energy will perform 1 MJ of work. Perioud. Because of this, the price of energy credits are constant.

Why are you applying physics of power to economic principles?

That way lies madness

EDIT: Building a bit more on top of this. A good way to confuse any economic student is to ask them to what money is. To save everyone a round of Googling, a rough definition of money is something that is universally accepted, a means of exchange and a way of storing wealth.

This can easily fit what energy is in game

 

[Sopbucket]

I'm having trouble seeing how this would have any significant impact on gameplay, or the economy. I get the realism argument, obviously your empire is going to need to get energy from somewhere, the problem is that the internal market isn't very realistic as it is, and this doesn't change that. The assumption is that there are always giant energy producers in your empire that you otherwise don't see, and they are just waiting for their resources to be bought up. If this were implimented, you could still run an empire entirely on trade, there would just be an extra step where you'd have to buy your energy occasionally.

There's no reason why the game couldn't introduce financial buildings that add a direct modifier to the amount of trade produced on a planet, or that passes through a starbase.

 

[evilcat]

Will adding more resource type improve the game? Probably not.
The current system is working well enought.
We can use Trade Value as universal abstract currency. That would be interesting but for another update.

Some form of loans would be interesting. Maybe leviathan traders could borrow some regular resources? And if we do not pay up they will hire Marauders to hit us back, and support our rivals. That would be fine addition. Of course loan interest rate would be taken from market, so if price is iinflated the rate would hike.

 

[OrigamiPhoenix]

Utility is constant because 1 MJ of energy will perform 1 MJ of work.

1 gram of gold is 1 gram of gold is 1 gram of gold and yet it varies in value because how you use gold can change, just like how you use energy can change.

 

[J.P.Cliffer]

Listening to you all i gonna maybe make a mod with 2 kind of energy : energy raw : raw material (mineral), food (yellow lightning)
hi tech energy : alloy and other exotic thing (blue lightning)
Market will be divided in 2 categories + 1 with hi-tech (man,machine) vs energy raw (hive are better for energy raw) for offer/demand

Why : The reason is when you are in a stranded desert you need food and it's higher value than jewel so it mean that raw energy ressource worth more.
The hi tech energy is usually energy after transformation and manpower cost added to personal value(iphone as example) so it usually cost more than raw energy.
Maintenance cost of ship is hi tech energy meaning batteries and other storage components+salaries of crew.
Optionally add raw energy cost when fleet are in enemy territory (logistics)
Is this good enough ? If you are against please speak and explain why ?

 

[Jorgen_CAB]

1 gram of gold is 1 gram of gold is 1 gram of gold and yet it varies in value because how you use gold can change, just like how you use energy can change.

The way you use it is probably not really what change in terms of energy. Different energy sources can be more or less efficient though. But if you could store energy perfectly intact and with 100% efficiency in a battery the use of it will not change.

The price on the other hand is a matter of supply and demand. If supply is higher than demand the price is low etc...

The thing that mostly prevent us from producing more stuff or more energy heavy stuff is the availability of cheap energy and the price for the finished goods, it is rather simple. It's not like we need people to produce the stuff... access to cheap enough energy will prevent production of certain items for the price the consumers are able to pay for it.

So basically... of we had more easily obtainable energy we could do so much more, the amount of people are almost inconsequential. This goes for recycling materials too.

 

[Mastikator]

But the value of 1 MJ of work is not constant.

The value of the Euro isn't constant either and we don't really care. Value is subjective and relative, hell the value of resources changes from person to person and over time.

All that matters is that you can arrive at a price for resources, in this regard using energy credits has no shortcomings when compared to Euros or US Dollars. However it has the benefit that while an alien civilization won't care about Euros they will care about energy because energy is a resource.

 

[JT_Sovereign]

Maybe trade value could take the role of currency. Collected trade value would be stored in its own stockpile instead of being converted to energy. It's primary use would be buying things on the market.

Trade value wouldnt literally be a currency, as dealing with currency doesn't make a ton of sense in a game where you otherwise deal directly with resources, and because utopian empires and shared burden empires wouldn't necessarily have currency. Instead trade value represents the liquidity of your economy; your ability to import resources or acquire them from third parties through a more abstract measure of wealth. It also creates a more intimate relationship between trade mechanics and the market itself.

As for hiveminds, maybe they can earn trade value by selling resources on the market but still don't conduct internal trade.

 

[wingren013]

The value of the Euro isn't constant either and we don't really care. Value is subjective and relative, hell the value of resources changes from person to person and over time.

All that matters is that you can arrive at a price for resources, in this regard using energy credits has no shortcomings when compared to Euros or US Dollars. However it has the benefit that while an alien civilization won't care about Euros they will care about energy because energy is a resource.

We don't care because the Euro is fiat currency. It's value is based on the exchange value of USD and the trust in the European union. We would care if it was backed by something, say gold, and the value of gold changed dramatically. This is basic the basic idea is that each piece of backed currency corresponds to an exact amount of whatever is backing it. This can cause hyperinflation very easily if a large source of whatever is used to back the currency is introduced to the economy. It also prevents governments from properly responding to economic crises, which is why the gold standard was suspended in WW1 and again during the Great Depression. Backing your currency with energy would cause runaway inflation punctuated by spikes of deflation and be an awful basis on which to run an economy (because if people can't trust the value of currency they are unlikely to invest). Logically, the governments of Stellaris should be experiencing a huge financial crisis around the midgame as energy becomes less valuable through increased levels of production.

 

[J.P.Cliffer]

We don't care because the Euro is fiat currency. It's value is based on the exchange value of USD and the trust in the European union. We would care if it was backed by something, say gold, and the value of gold changed dramatically. This is basic the basic idea is that each piece of backed currency corresponds to an exact amount of whatever is backing it. This can cause hyperinflation very easily if a large source of whatever is used to back the currency is introduced to the economy. It also prevents governments from properly responding to economic crises, which is why the gold standard was suspended in WW1 and again during the Great Depression. Backing your currency with energy would cause runaway inflation punctuated by spikes of deflation and be an awful basis on which to run an economy (because if people can't trust the value of currency they are unlikely to invest). Logically, the governments of Stellaris should be experiencing a huge financial crisis around the midgame as energy becomes less valuable through increased levels of production.

No increased level of production is linked to the increase in population that use more power too and even spaceship is a sink if you have too much energy you probably use a bad distribution of ressources (you don't buy alloy)
And about economic crisis we have one with sovereign debt soon enough to see that monetary system based on private bank interest hit us back except china and other government controlled bank like north korea and iran due to the no interest money value in circulation.

 

[makaramus]

I will be "that guy" and point out that energy would be a hideously terrible thing to use as a currency, for any civilization at any level of development, because the price of energy is extremely unstable, varying even with the weather. If you ever want an economist to look at you with a mixture of horror and confusion, suggest that we go back to fixed exchange rates, but pegged to the price of oil instead of the price of gold.

Can you just imagine the madness of a future economy using energy credits? Inflation every time new power plants are built. Crippling money supply shortages every time the fleet mobilizes for war. A catastrophic collapse of the value of your entire life savings every time a new type of power generation technology is developed. The dyson sphere being turned on and immediately ushering in the Great Galactic Depression. Just look at the basket-case economies of real world countries that rely too much on oil exports to fund their society and you'll get just a fractional glimpse of how insane it would be.

I realize that energy credits are a common sci fi trope and that Stellaris is about trope fantasy fulfillment, not realism, but it's still a really dumb trope. I'm much more comfortable when they violate the laws of physics.

can inflation exist althought when there is almost infinite amount of inflation allready?
when someting has value of its own I think you dont need to keep inflation low anymore

its like using cow as money
no matter how many cows there are you can allways use cows for other purposes making them a safe place as money... you know what you can do with them
yes producing even more energy reducing value of it as currency but... you also know you can use that energy to product other things! so its allways worth someting too
it has inflation... with a minimum value
its not hopeless currency... just unstable

 

[Dinkelman]

I would not support dividing the two, and I agree with Mastikator's post at the top of this page. I like the concept of energy credits. When you think about it, currency is just energy with extra steps. We pay money to people for jobs done, work exerted. It's the time and effort of others, energy, in essence. We put a value on the time we have in our lives, since that is the only inherent resource we all have. We can make it worth more by taking the time to get an education. All of it can be directly or indirectly translated to energy. I mean, the entire universe is energy, in some form or another.

Historically with time, you'd think currency has become more and more abstract, shedding its dependency of a concrete materialized form, like gold, to printed bills, to numbers in computerized systems. So why then would it take such a concrete form of energy? Well, you could on the other hand see it as that it's just approaching the purest manifestation of the concept of 'money'. You could see it as if it's getting more and more reduced to its very essence, the more advanced the society gets. So in my eyes, it's not unreasonable that in a future society, money is directly equivalent to energy. It is after all the resource at the center of it all, even today, just in many different forms. And even if the currency isn't explicitly energy, you could argue that in the game, it can be represented as such, to simplify the concept, just like a pop represents a large demographic in an abstract way, for game design purposes.

 

[monkeypunch87]

I'm all for a divide of credits and energy. I never liked the notion that I pay and trade with electricity, which I also use for the upkeep of my buildings and robots.

With 2.2 and the new trading mechanic, I feel that a divide is even more a necessity. So, I pay my local planet upkeep with interstellar trade? I generate "money" for my trades in my generator districts? It is rather silly and in my mind in Stellaris it is all about battery trading...

In my opinion it would even make the lore difference to hive minds and the rest easier. They don't know the concept of credits/money. Right now, I don't understand why they aren't able to trade energy batteries? They use them like every other empire.

 

[Dreagon]

I personally don't see a reason why we should split it. It works perfectly fine as it is and would add complexity for the sake of complexity.