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On power markets, snow storms, and $16k power bills

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Re: On power markets, snow storms, and $16k power bills

#201

Post by rfdave »

ryanmarsh wrote: post #176
bumby wrote: post #165

Earlier quoted context omitted.

Can you elaborate on how the research was conducted and specifically how the risk was measured by consumers? There’s an awful lot of research that implies humans are very poor estimators of low probability / high severity events

Research was normal UX/cust research... interviews, polls, etc. Customers were intelligent and motivated by a desire to do their own hedging rather than have an REP in the middle with an opaque profits. There’s a lot of profit in there and customers wanted to keep it. Customer ultimately knows his own demand and tolerances better than any REP. When I say “he” I mean men. Overwhelmingly male market. Lots of small busi…

Sounds like a fun filled hobby. How many people are interested in actually spending 30 to 40 hours spooling up to understand what they're getting, and 5 to 10 hours a month tracking it? I'm sure there's a population, but I'd rather spend another $20/month and do something fun with my time.

Re: On power markets, snow storms, and $16k power bills

#202

Post by jjeaff »

nickysielicki wrote: post #110
ahepp wrote: post #66

>Those that chose Griddy, chose higher risk, which comes with high potential rewards but also high potential losses When I lived in the poor part of town, "energy deregulation" companies were always coming around, aggressively trying to get me to sign up on the spot. They never talked about risk, they just told me I could sign here to save $100s on my power bill. I asked them about the details and they just lied thro…

> This article seems to suggest the answer is a fully automated smart home, with some kind of AI to intelligently manage your power usage. Sounds awesome, but I don't think that's ever going to be a reality outside the valley. This is shockingly myopic.

Not myopic, just overly complicated. Huge strides in availability could be made by simply having smart meters that allow the power company to adjust the maximum draw before the breaker kicks.

Rather than cutting off all the power for half the city, cut off half the power for the whole city. That way people could still have a small space heater and some lights but not run their dryers and who knows what else.

Re: On power markets, snow storms, and $16k power bills

#203

Post by upbeat_general »

mindslight wrote: post #156
ahepp wrote: post #66

>Those that chose Griddy, chose higher risk, which comes with high potential rewards but also high potential losses When I lived in the poor part of town, "energy deregulation" companies were always coming around, aggressively trying to get me to sign up on the spot. They never talked about risk, they just told me I could sign here to save $100s on my power bill. I asked them about the details and they just lied thro…

I was thankful my elderly father lived in a town with a municipal electric company, so all of the spam calls he got about "lowering his bill" could never go anywhere. Obviously there's some hidden catch, otherwise they wouldn't be spamming! I think the Griddy scheme is in the process of destroying itself, as it becomes apparent how many people won't be paying their bills, either through bankruptcy or populist legisla…

Now this is the best comment I’ve seen in all the treads about the power outages.

Re: On power markets, snow storms, and $16k power bills

#204

Post by readflaggedcomm »

ashtonkem wrote: post #195
twunde wrote: post #94

Earlier quoted context omitted.

TX is __slightly__ different in that its fully deregulated and there's simply more knowledge about REPs/ESCOs and their pricing (because they customers HAVE to choose a REP). Also in what other state do you see billboard ads for REPs? What is genuinely sad is that Griddy has a "price-lock" (ie a fixed rate) for the summer, which is exactly what you're talking about regarding tail risk. They just don't have it for the…

My understanding is that the energy markets started reacting to the polar vortex with days or weeks worth of warning, meaning that Griddy shouldn't have been that surprised that something was coming. Therefore it appears like Griddy was asleep at the helm, uninterested in doing anything about it, couldn't negotiate/hedge in time, or just internally confused.

The article says they told their customers to switch away. What it doesn't mention is that this was over a weekend, and many people couldn't manage the switch before the weather hit.

Re: On power markets, snow storms, and $16k power bills

#205

Post by ashtonkem »

soylentcola wrote: post #197
ashtonkem wrote: post #195

Earlier quoted context omitted.

My understanding is that the energy markets started reacting to the polar vortex with days or weeks worth of warning, meaning that Griddy shouldn't have been that surprised that something was coming. Therefore it appears like Griddy was asleep at the helm, uninterested in doing anything about it, couldn't negotiate/hedge in time, or just internally confused.

Can't you say this for most things, though? People talked about the likelihood of a new contagious respiratory viral pandemic for years. Plans were drawn up, warnings were made, and the response was mostly "uh huh, that would suck for sure". Same could be said about anyone who's ever had their data lost to malware or hardware failure and didn't have a proper backup in place. On some level I think it's human nature to…

There’s a big difference between “there might be a pandemic at some point in the indeterminate future” and “the price of 7 day gas futures is rising rapidly”. There’s also a difference between “Texas’ grid might fail in a future freeze” and “there will be a bad freeze next week”.

It doesn’t make sense to try and draw a parallel between a bad hypothetical that might happen in some indeterminate future and a negative possibility that will either come to pass or fizzle within a very short time horizon.

Re: On power markets, snow storms, and $16k power bills

#206

Post by zbrozek »

bluGill wrote: post #67
jandrese wrote: post #26

It strikes me that Texas is suffering the same sort of problems that companies that switch to just-in-time delivery do. When everything is working they're more efficient and can out-compete their neighbors, but since they're running with little to no safety margin it only takes one incident to cause immediate disruption to the line. Of course when the consequence of a disruption is you miss your production targets fo…

Companies that do just in time in fact are careful to manage their supply chain for this. I know my company orders steel 3-6 months in advance, in part because this eventually reaches all the way back to the miners digging the ore. They now can plan their work to ensure they don't have to pay overtime to meet our orders (compare to when we figured out the best price of the year and ordered a 1 year supply for deliver…

Let's say you're a cloud operator placing long-lead just-in-time orders for hard drives with three different suppliers. Thailand floods and your carefully planned-in-advance delivery schedule is hosed. Your competitor with some inventory runway now has an advantage.

In many ways inventory is better than insurance because you're going to use it and so the cost is limited to storage.

Re: On power markets, snow storms, and $16k power bills

#207

Post by cameronh90 »

paulgb wrote: post #84
ahepp wrote: post #72

Earlier quoted context omitted.

I used to have these guys (EDIT: energy dereg companies, not griddy specifically) knocking on my door regularly with a pen, asking me to sign a contract for real time pricing literally on the spot, because I could save a bunch of money on my bill I would be shocked if there is any energy deregulation company that doesn't resort to this, because it's the basic result of hiring contractors and paying them on commission

Unfortunately energy deregulation seems to disproportionately attract hucksters. I had never heard of Griddy until recently but in NY we have our share of pushy firms with questionable sales. Question for those in TX: was your perception of Griddy that they were sketchy, or just a get-what-you-pay-for sort of basic service? Did they aggressively sell door-to-door?

We have energy privatisation in the UK and I've never experienced any hucksters. Indeed, I've had a very good experience with the small start-up energy providers compared to the big pre-privatisation firms.

I would guess there are different types of deregulation. We still have a regulatory body that ensures the market and new private entrants are operating effectively.

Re: On power markets, snow storms, and $16k power bills

#208

Post by zbrozek »

mortenjorck wrote: post #4

Is there a reason why time-of-use systems can’t have a customer-defined price limit, beyond which they opt into a blackout? The sense I got from the stories of people suddenly facing five-figure power bills is that most would have gladly spent a night or two with propane and candles rather than cleaning out their savings.

There's another post that used a term I'm going to appropriate for other conversations: homo economicus. We aren't that species. We don't have perfect information. We don't have infinite capacity or attention span to continuously micro-optimize everything.

It's why people buy products and services rather than vertically integrate everything in their lives. I don't want to live Texan Power Simulator any more than I want to be mining my own bauxite or replacing my driveway. Buying a product or service is granting the supplier a profit in exchange for them worrying about and executing the business. But you don't buy power any more. You buy access to a dynamic marketplace in which you probably didn't really want to participate.

What if there were real time pricing per byte coming down from your ISP and you had to sit and stare at your screen waiting for an affordable moment to check your email? Or what if you had to stop mid-shower to avoid spending five figures to rinse the soap off? I can't imagine being happy in those cases, I don't know why I should be happy about it for electricity.

Re: On power markets, snow storms, and $16k power bills

#209

Post by zbrozek »

feralimal wrote: post #148

Smart meters are an essential part of the technocratic control structure. It is imperative that technocrats (those best able to manage the populations) have all the information about individuals and household electric and water usage, so that they are able to finely control and manage these precious resources. It can't be long until we start to see value judgements about usage - 'your electricity usage for a heating…

That's already exactly what tiered pricing is.

Re: On power markets, snow storms, and $16k power bills

#210

Post by feralimal »

zbrozek wrote: post #209
feralimal wrote: post #148

Smart meters are an essential part of the technocratic control structure. It is imperative that technocrats (those best able to manage the populations) have all the information about individuals and household electric and water usage, so that they are able to finely control and manage these precious resources. It can't be long until we start to see value judgements about usage - 'your electricity usage for a heating…

That's already exactly what tiered pricing is.

Tiered pricing doesn't make a judgement on what you are using. It doesn't say "you're using your oven or A/C too much".

What I would like to know, is are smart meter capable of refusing a demand for electricity for a device. So, say the company wants to use minimal electricity, will it allow energy for fridges and freezers, but not for A/C and TVs?

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