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Clearing price for supplying power to Texas grid –$31.65

ercot.com

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Re: Clearing price for supplying power to Texas grid –$31.65

#251

Post by dann0 »

mrDmrTmrJ wrote: post #30
ggm wrote: post #22

The market in power should only exist to optimise. Its become a rei-ified good in its own right, and is being gamed by bad faith actors with stranded assets (coal, oil) to make a point about green power and capital investment money they want. It's possible no power network could have avoided some of this, but its patently obvious a regulated power utility function needs investment, and the market is not the best mode…

Honestly, I reach a very different conclusion. Comparing ERCOT to other grids (PJM or CALISO), ERCOT system has delivered very low prices and very high levels of renewable penetrations. PJM wastes billions of dollars a year in capacity payments to coal plants for no reason. What you write, "The market in power should only exist to optimise" well, that is exactly what ERCOT does. As for the disaster last week, that wa…

A free market approach also places focus on the wrong performance indicators. Why is “very low cost” even a consideration when it leads to under investment which in turn results in significant power outages for significant periods of time.

The low cost of delivery is irrelevant if there is a strong chance that I’ll freeze to death because my service provider tries to be efficient and profitable instead of trying to be 100% online.

I understand the desire to avoid waste and inefficiency, but free market approaches tend to ignore the human factors and prioritise the financial. That’s not the correct.

Re: Clearing price for supplying power to Texas grid –$31.65

#252

Post by 0xBDB »

smaddox wrote: post #236
mrDmrTmrJ wrote: post #54

Earlier quoted context omitted.

Strongly agree. Free markets often fail to adopt low cost protections to tail events. E.g. the free market didn't get us 100% of new cars having seatbelts and airbags, government requirements did. And those standards were fought by the car manufacturers. My point is we need regulations to mandate our energy system to be resilient to outlier events (heat/cold/flooding/high wind etc.) and that's a government function s…

Based on what I've read, my understanding is that the separate Texas grid and ERCOT exist because Texas politicians wanted (and still want) to avoid federal regulation. The parts of Texas that were not on the separate Texas grid, i.e. El Paso didn't lose power. Are you saying that the rest of the US does not have a power market with appropriate regulations? Because as far as I can tell, this crises could have been co…

As far as I can make out, this narrative is simply not true, at least not with regard to power generation. Texas is subject to the same NERC regulations as the rest of the U.S. and Canada.

https://en.wikipedia.org/wiki/Texas_Reliability_Entity

Re: Clearing price for supplying power to Texas grid –$31.65

#253

Post by 0xBDB »

selestify wrote: post #121
jetrink wrote: post #10

Context: > For wind developers, federal tax credits also are a contributing factor, even allowing the wind resources to make offers at negative prices. However, low and/or negative offers are not limited to any particular resource, and it is not uncommon for thermal generators to submit negative prices to decrease their chances of being dispatched below their desired or capable levels. > ... > Market prices tend to g…

Why is there low demand right now? It’s still pretty cold in Texas.

It's sunny and 72F in Dallas today, up 74 degrees since Tuesday. That kind of swing is not unusual although the magnitude obviously is.

Re: Clearing price for supplying power to Texas grid –$31.65

#254

Post by 0xBDB »

beerandt wrote: post #242
jasongill wrote: post #179

Earlier quoted context omitted.

Texas isn't connected to either of the two national power grids (east and west half of lower 48 states, roughly) so that their power system isn't subject to federal regulation.

That's just false- Texas has at least 5 DC interconnects, to both east and west US grids, as well as Mexico. Edit: Check the last section on their real time status page: http://www.ercot.com/content/cdr/html/real_time_system_condi...

The other half of what the grandparent said also seems completely completely false. Texas is subject to federal (indeed international) regulation through the North American Electric Reliability Corporation, same as the rest of the U.S. and Canada. I don't fully understand why this is being reported otherwise, though, so maybe I'm missing something.

https://www.texasre.org/compliance

Re: Clearing price for supplying power to Texas grid –$31.65

#255

Post by bobthepanda »

tyingq wrote: post #244
mikewarot wrote: post #232

Earlier quoted context omitted.

>I imagine keeping lots of spare train cars around isn't a big engineering task. The solution I've seen in person is the "coal pile", with Caterpillar bulldozers on it, keeping the surface from combusting, and moving things around. They are proven simple technology, and work in winter. Keeping the coal in the train invites disaster, as rail infrastructure has issues with icing conditions.

Point taken, though disaster might be a strong word. It sounds like the net result is up to 20% of the coal sticking to the sides of the car. And there are ways to reduce that.

You generally can’t offload a coal railcar from just any point in a yard, and switches can freeze over and lock in place.

Re: Clearing price for supplying power to Texas grid –$31.65

#256

Post by taeric »

WalterBright wrote: post #155
taeric wrote: post #107

Earlier quoted context omitted.

This is an argument that feels right. However, you are just shifting first in, for biggest wallet. In large, I confess I am ok with that shift. But it really doesn't help more people. Or more at risk people.

> you are just shifting first in, for biggest wallet Not shifting because there's no supply. The mosquito fleet of entrepreneurs driving in to make a buck selling gas, water, food, supplies, etc., disappeared. Which would you rather do in Texas: watch your house slowly freeze and know you'll have 5 figures in freeze damage while waiting several days for the government to restore power, or buy a generator and a can of…

The problem with this hypothetical is that there is a non zero chance that generator will cause problems. Worse, if it is profitable, expect cheating and corners to be cut.

Is especially odd, in that a well regulated power market seems to handle this better. Yes, other places had outages. Not comparable in scale, though.

There is also the oddity that similar arguments could be made that you could get medication on the street market. Why would anyone cut corners there? :). Surely, if you are in need, you should be allowed to buy someone else's medication from them at stupid high prices?

Edit: so to directly answer what I would rather do if I was in Texas. I would rather have had risk of failure properly priced into the market such that they were more ready to deal with it.

Re: Clearing price for supplying power to Texas grid –$31.65

#257

Post by taeric »

imtringued wrote: post #177
WalterBright wrote: post #155

Earlier quoted context omitted.

> you are just shifting first in, for biggest wallet Not shifting because there's no supply. The mosquito fleet of entrepreneurs driving in to make a buck selling gas, water, food, supplies, etc., disappeared. Which would you rather do in Texas: watch your house slowly freeze and know you'll have 5 figures in freeze damage while waiting several days for the government to restore power, or buy a generator and a can of…

Honestly, this is such an interesting problem. If one were to assume that price gauging laws for fuels didn't exist one would be allowed to think about how to provide this emergency service in the most effective way possible. Uber could just have a new category for emergency deliveries. The government could also take advantage of this service for emergency relief.

Feels like this is an area where the ounces of prevention more than out weigh any bickering on pounds of cures.

That is, the best response to many crises is best taken before the crises.

Re: Clearing price for supplying power to Texas grid –$31.65

#258

Post by cozzyd »

bobthepanda wrote: post #255
tyingq wrote: post #244

Earlier quoted context omitted.

Point taken, though disaster might be a strong word. It sounds like the net result is up to 20% of the coal sticking to the sides of the car. And there are ways to reduce that.

You generally can’t offload a coal railcar from just any point in a yard, and switches can freeze over and lock in place.

This is why metra (Chicago commuter rail operator) literally lights switches on fire sometimes

Re: Clearing price for supplying power to Texas grid –$31.65

#259

Post by cozzyd »

Retric wrote: post #211
roenxi wrote: post #185

Earlier quoted context omitted.

What if I've got a prepper bent and am OK with losing power for a few days in a 1:100 year event? Can I still get cheap, slightly unreliable power? Not to make light of the events in Texas - it sounds scary and they need to be prepared for next time. But the answer isn't automatically "they should have had a gold plated the grid!". The answer might be "they should be have been prepared for a few days without power in…

Your personal value for reliability isn’t relevant. The electric grid is providing power for hospitals with back up generators and office building which don’t. The value of each of those 9’s to society and the overall economy is what matters and business being forced to shut down lose vastly more money than it would cost to prevent this issue. The market based solution is to add a very large fine for blackouts on a p…

I'm not sure that works because the operator can just go bankrupt in that situation?

Re: Clearing price for supplying power to Texas grid –$31.65

#260

Post by spacemanmatt »

fallingknife wrote: post #116
spacemanmatt wrote: post #8

Earlier quoted context omitted.

I believe that is an accurate description of disincentivizing oversupply. I hate ERCOT.

You hate ERCOT for disincentivizing oversupply?

No. Is that your real estimate of an actual Texan who just saw neighbors lose power and water for up to 9 days during a historic freeze? There is a body count of 75, last I heard.
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