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Does daylight saving time cost Utahns money? Study says yes

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By Jennifer NAPIER-PEARCE

The Salt Lake Tribune

First published Mar 08 2013 09:48AM
Updated Mar 10, 2013 12:37AM

William Shughart abhors daylight saving time.

"I think it’s a tyrannical action by the federal government," Shughart, a Utah State University finance professor who’s written numerous articles on the topic, said in an interview this week.

Love it or loathe it, daylight saving time is on its way, with Americans (except for Arizonans and Hawaiians) springing clocks forward an hour at 2 a.m. Sunday.

The practice of setting clocks based on sunlight has had its critics since Congress started officially regulating time in 1966.

Some say the practice throws off body clocks, with one study citing an uptick in auto accidents the Monday following the time change and another showing a "significant" increase in heart attacks in the three days following springing forward.

But does it make any economic sense?

The conventional wisdom has been yes, daylight saving time, or DST, is an economic boon, with savings for consumers on electricity bills, time for outdoor enthusiasts (which means money for the recreation industry), and revenue for retailers, thanks to late-night shopping.

But a growing number of analysts quibble with those assumptions. A recent analysis by Chmura Economics & Analytics concludes DST actually costs each Salt Lake City resident an extra $1.23, when factoring in heart attacks, workplace injuries and a lack of productivity at the office. Shughart of USU thinks that number is low, arguing it takes 10 minutes to change clocks twice a year, the opportunity cost of DST works out to about $2.93 per person. Multiply that number by the U.S. population and he says we’re talking $1.7 billion annually.

"There are many costs of DST both to human health and to the economy and absolutely no benefits," Shughart said. "No argument justifies the cost of DST."

What about saving energy? Not flipping on the light switch until later in the evening saves on electricity costs, right?

One California study showed "marginal" electricity savings with DST, but that doesn’t appear to be the case in Utah. Rocky Mountain Power spokesman Jeff Hymas said consumers may hold off on switching on the lights during DST, but end up turning on the air conditioners more often during the hot summer months.

"Nationally, there seems to be a general consensus that daylight saving time contributes to an evening reduction in peak demand for electricity, though the overall impact may be somewhat offset by increased electricity use in the morning," Hymas said. "In Utah, temperature affects our customers’ use of electricity much more than changes in the amount of daylight."

But surely golfers and other outdoor-types justify DST?

Not so fast, said Rick Graham, director of public services for Salt Lake City. He said the city, which operates eight courses, has never done an exhaustive economic analysis of daylight saving time, but golfer behavior doesn’t seem to pay much attention to the clock.

"Golfers, they’re going to play golf as soon as they can see daylight and will stay on the course until they can’t see the ball," Graham said. "They’re used to playing sun-up to sunset, so I’m really not sure (DST) has that much of an economic effect."

Still, daylight saving has its fans. Shopkeepers large and small love it because it helps their bottom line, said Natalie Gochnour, chief economist for the Salt Lake Chamber.

"We definitely have retailers who have told us that daylight saving time advantages retailing because we have that extra hour in the evening," Gochnour said. "They say people are more likely to shop ­­— and shop more — when it’s light outside."

But even that may be anecdotal, said Jim Wood, chief economist at the Bureau of Economic and Business Research at the University of Utah. Although he admits he hasn’t studied the issue specifically, he’s cautious about assuming DST boosts sales numbers.

"If people are doing more retail shopping, they’re spending less on a vacation. They only have so much money to spend," Wood said. "The net effect is a wash."

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