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Hetzner Price Adjustment

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Re: Hetzner Price Adjustment

#31

Post by londons_explore »

ChuckNorris89 wrote: post #9

Germany € 0.29/kWh € 0.45/kWh Finland € 0.12/kWh € 0.22/kWh Damn, why is electricity in Germany over twice as expensive as in Finland? I doubt Germans have twice the purchasing power as Finns.

The instantaneous market price that everyone pays is the marginal cost of the most expensive power source currently online.

For nearly every country worldwide, that is gas turbines most of the time. Even if 90% of power generation is coming from solar, it's the 10% gas that sets the price (since the marginal cost of installed solar is near zero).

Gas prices in Europe vary by region, but are pretty much determined by gas transport capacities to Germany. Ie. Germany has the highest prices because of government mandates to fill storage. Any place with good gas transport links also has high prices. Places with few/no pipelines to Germany and an independent supply have low prices.

And that is why Germany is twice Finland (Finland gets gas from Norway, and neither has big pipelines to Germany).

Re: Hetzner Price Adjustment

#32

Post by nik736 »

Dunedan wrote: post #26
nik736 wrote: post #16

Earlier quoted context omitted.

Don't worry they will. At least in Germany :-) Electricity pricing is insane and will only get worse. I doubt AWS will operate a whole region at a loss.

Amazon invests a lot in its own wind and solar parks. Because of that, energy prices on the open market shouldn't affect them too much. Read more about that at https://sustainability.aboutamazon.com/environment/renewable...

Interesting, but looking at their map they will go live in Germany in 2025. Which is way too late to ride this out.

Re: Hetzner Price Adjustment

#34

Post by weberer »

zach_garwood wrote: post #17
ChuckNorris89 wrote: post #9

Germany € 0.29/kWh € 0.45/kWh Finland € 0.12/kWh € 0.22/kWh Damn, why is electricity in Germany over twice as expensive as in Finland? I doubt Germans have twice the purchasing power as Finns.

Finland has oil. Germany imports oil from Russia.

You're thinking of Norway. Finland does not have any oil reserves at all.

Re: Hetzner Price Adjustment

#35

Post by jansan »

zach_garwood wrote: post #17
ChuckNorris89 wrote: post #9

Germany € 0.29/kWh € 0.45/kWh Finland € 0.12/kWh € 0.22/kWh Damn, why is electricity in Germany over twice as expensive as in Finland? I doubt Germans have twice the purchasing power as Finns.

Finland has oil. Germany imports oil from Russia.

Only 0.2% of the electricity is generated from oil in Finland. But Finland produces a good quarter of its electricity from nuclear power. Maybe that makes a difference?

Re: Hetzner Price Adjustment

#36

Post by doikor »

londons_explore wrote: post #31
ChuckNorris89 wrote: post #9

Germany € 0.29/kWh € 0.45/kWh Finland € 0.12/kWh € 0.22/kWh Damn, why is electricity in Germany over twice as expensive as in Finland? I doubt Germans have twice the purchasing power as Finns.

The instantaneous market price that everyone pays is the marginal cost of the most expensive power source currently online. For nearly every country worldwide, that is gas turbines most of the time. Even if 90% of power generation is coming from solar, it's the 10% gas that sets the price (since the marginal cost of installed solar is near zero). Gas prices in Europe vary by region, but are pretty much determined by…

> (Finland gets gas from Norway, and neither has big pipelines to Germany).

Not really. Finland used to get gas from Russia but now it is mostly from a pipeline through Estonia to Latvia where it arrives in ships from wherever happens to be the cheapest (we are in process of building the first LNG terminal in Finland). Could be Norway but can also be USA, middle east, etc

Finland just doesn't use much gas for electricity. What we use mostly goes into industrial processes. We do have a couple gas peaker plants but those are only used in the winter if needed. Actual load balancing happens through hydro (and imports from Norway/Sweden but that is also mostly hydro)

Re: Hetzner Price Adjustment

#37

Post by kuboble »

Semaphor wrote: post #7

Interesting that the colo electricity cost goes up that much, that’s a lot more expensive than what I will pay as a normal consumer, I’d have thought they’d get better discounts.

I believe in EU household electricity is largely subsidized and the industry always paid more.

Re: Hetzner Price Adjustment

#38

Post by jansan »

weberer wrote: post #29
ChuckNorris89 wrote: post #9

Germany € 0.29/kWh € 0.45/kWh Finland € 0.12/kWh € 0.22/kWh Damn, why is electricity in Germany over twice as expensive as in Finland? I doubt Germans have twice the purchasing power as Finns.

Germany shut down all their nuclear plants about 10 years ago, opting to rely on natural gas from Russia. Finland invested in nuclear and is bringing their latest plant online this fall. It doesn't take a genius to see which one would be hit harder by sanctions on Russian gas.

It didn't take a genius even 10 years ago. That decision to get out of nuclear power, based only on emotions, was a grave mistake.

Re: Hetzner Price Adjustment

#39

Post by londons_explore »

Dunedan wrote: post #26
nik736 wrote: post #16

Earlier quoted context omitted.

Don't worry they will. At least in Germany :-) Electricity pricing is insane and will only get worse. I doubt AWS will operate a whole region at a loss.

Amazon invests a lot in its own wind and solar parks. Because of that, energy prices on the open market shouldn't affect them too much. Read more about that at https://sustainability.aboutamazon.com/environment/renewable...

Buuut... Just because you made a good business move and hedged one of your raw materials, doesn't mean your competitors did. If your competitors didn't, then you might as well rise prices and just take the extra as profit.

Or... look at it another way, you bought some nice energy futures contracts when they were cheap. You might earn more selling those energy futures contracts now they're very valuable than you make putting that energy into servers and selling the compute.

Re: Hetzner Price Adjustment

#40

Post by rad_gruchalski »

weberer wrote: post #29
ChuckNorris89 wrote: post #9

Germany € 0.29/kWh € 0.45/kWh Finland € 0.12/kWh € 0.22/kWh Damn, why is electricity in Germany over twice as expensive as in Finland? I doubt Germans have twice the purchasing power as Finns.

Germany shut down all their nuclear plants about 10 years ago, opting to rely on natural gas from Russia. Finland invested in nuclear and is bringing their latest plant online this fall. It doesn't take a genius to see which one would be hit harder by sanctions on Russian gas.

> Germany shut down all their nuclear plants about 10 years ago...

"Nuclear power in Germany accounted for 13.3% of German electricity supply in 2021, generated by six power plants, of which three were switched off at the end of 2021, the other three due to cease operation at the end of 2022 according to the complete nuclear phase-out plan of 2011." https://en.wikipedia.org/wiki/Nuclear_power_in_Germany

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