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Day ahead electricity prices for EU

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Re: Day ahead electricity prices for EU

#281

Post by seydor »

vorpalhex wrote: post #200
bjourne wrote: post #60

Remember that, while prices have soared, electricity generation has not become more expensive. The "electricity crisis" is a crisis for European consumers but a massive windfall for producers. This is a market failure - not an electricity failure.

That's just wrong. The components of electricity generation - the fuel - has exploded in price. You may not be aware, but there's a war going on that is sort of impacting things on top of existing inflation. I realize picking a scape goat feels easy but it's poor form and leads to not fixing the actual problem.

If that were true countries that don't depend on russia would not be affected. Greece uses little natgas, and only only 4% of it is russian, yet it sees some of the most steep rises.

Re: Day ahead electricity prices for EU

#282

Post by seydor »

kitkat_new wrote: post #280
seydor wrote: post #263

Earlier quoted context omitted.

No, the EU wholesale market uses a marginal price, that does not reflect the cost of generation (supply), but the highest cost available at any moment sets the price for everyone (at least as far as i understand). It s a free market but prices are set by a very inflexible rule.

this doesn't change anything. If supply was higher, e.g. using solar/wind/nuclear/coal, prices would be lower

that would work only if non-gas sources generated enough so that gas is not needed at all. As it is right now, solar producers are getting a bonanza in profits because they are being paid at exorbitant prices. At this level, they have no incentive to ramp up production to remove gas from the equation.

Re: Day ahead electricity prices for EU

#283

Post by bitL »

Tenoke wrote: post #156
locallost wrote: post #95

This is nothing. If you want to panic, check the futures markets for the next 2 quarters, especially France. So I think short term we are pretty screwed. But I think if you can produce electricity at 1/10 or even 1/20 of the price, wouldn't you be adding new capacity now? The only fast option are renewables, so my wild guess is that there will be so much new capacity added in the next years, the bottleneck will not b…

Should I panic enough in Germany to be wise to consider moving away? Where as a European?

Yes, move to Dubai, it's the most stable part of the world right now, and you aren't going to freeze.

Re: Day ahead electricity prices for EU

#284

Post by raverbashing »

spaceman_2020 wrote: post #209
pojzon wrote: post #175

Earlier quoted context omitted.

Ive tried to explain this issue to EVs fanatics, but nobody listens. Anytime you mention energy transmision issues - you get total backlash. We wasted EU money on pointless stuff while we could have upgraded our transit cables etc.

Germany’s obsession with solar and wind is absolutely baffling. It takes very little to know that Germany simply does not have the conditions for large scale solar. Yet it was pushed so heavily in lieu of nuclear power. Absurd.

And yet, right now, solar is 20% of the electricity on the grid in Germany. Wind is 15% (per the electrictymaps app)

Sure it would be better if it was a sunnier place, still...

Re: Day ahead electricity prices for EU

#285

Post by seydor »

chii wrote: post #55
the_mitsuhiko wrote: post #28

Earlier quoted context omitted.

I have no clue about Czechia but that’s basically happening in Austria. Austria mainly produces energy from renewables which did not go up in price buy since the price on the exchanges is determined by the most expensive source we still pay exorbitant prices. Producers are making all the money right now.

which would give more producers (and wana-be-producers) the incentive to invest in renewables to take a piece of that profit pie. Doesnt seem like a bad outcome tbh.

Wait, if they invest too much, then natural gas will not be needed, and prices will steeply fall. So better not invest (too much), right?

Re: Day ahead electricity prices for EU

#286

Post by origin_path »

dazc wrote: post #91
sph wrote: post #66

Earlier quoted context omitted.

Can anybody explain why that is? Why a country that generates 99+% of its own electricity like UK is seeing price increases? Everybody blames the war, but AFAIK UK imports 1% of its gas from Russia, and its electricity is generated locally, so why are prices increasing? I would expect grain and wheat to increase 500%, not power.

We generate a lot of this electricity by burning gas which we have to buy from the market where prices are set relative to global supply and demand. This is why we originally stopped mining coal - because Russian gas was so cheap at the time that it was a no-brainer. What could possibly go wrong?

UK stopped mining coal mostly in the 1980s when Russia was still the Soviet Union. The cause was not Russian gas which isn't a direct substitute for coal anyway and especially not back then, but rather that the NUM destroyed the domestic coal industry, which became totally uncompetitive relative to more or less any foreign producers. It wasn't Russia specifically, it was that UK mining became dysfunctional and unreliable.

Re: Day ahead electricity prices for EU

#287

Post by locallost »

jillesvangurp wrote: post #188
locallost wrote: post #95

This is nothing. If you want to panic, check the futures markets for the next 2 quarters, especially France. So I think short term we are pretty screwed. But I think if you can produce electricity at 1/10 or even 1/20 of the price, wouldn't you be adding new capacity now? The only fast option are renewables, so my wild guess is that there will be so much new capacity added in the next years, the bottleneck will not b…

We're not screwed. We're just witnessing the accelerated death of the fossil fuel based power generation industry and it's making renewable power extremely lucrative. Prices are high because of gas prices. Except it's August and Europe is producing a lot of solar power and a fair bit of wind power. That's why there are no blackouts. There is no power shortage; just a gas shortage. Europe has plenty of reserves to gen…

I agree with all that, but in the short term things are going to be very expensive. As I already wrote, I see it as an opportunity to do what you said - ditch fossil fuels for good. There's no point in doing anything else, like whining. But if you think the landing will be anything other than rough, then we'll have to disagree.

Re: Day ahead electricity prices for EU

#288

Post by origin_path »

seydor wrote: post #281
vorpalhex wrote: post #200

Earlier quoted context omitted.

That's just wrong. The components of electricity generation - the fuel - has exploded in price. You may not be aware, but there's a war going on that is sort of impacting things on top of existing inflation. I realize picking a scape goat feels easy but it's poor form and leads to not fixing the actual problem.

If that were true countries that don't depend on russia would not be affected. Greece uses little natgas, and only only 4% of it is russian, yet it sees some of the most steep rises.

Lots of countries import gas using LNG terminals. Those gas ships can go to any country that has import terminals and they set sail for the highest bidder. So gas is like oil, there's only a few global prices.

Re: Day ahead electricity prices for EU

#289

Post by ClumsyPilot »

dkjaudyeqooe wrote: post #98
locallost wrote: post #85

Earlier quoted context omitted.

It's because not all electricity costs the same to produce, but the price is the same, determined by the most expensive producer. There is a shortage of electricity because France is generating a lot less than normal and this is made up by other countries. I would guess the UK is impacted by higher demand as well, thus the more expensive producers are delivering jacking up the prices for everyone.

> determined by the most expensive producer That's wrong. The price is determined by demand and supply, which in turn is determined by what prices producers are willing to sell at and consumers are willing to buy at, plus other traders in the market.

The parent is providing valuable and spesific information on how energy market works, you are incorrecting him by reciting a generic market principle that everyone learns at school, without any insight of how it applies to situation at hand.

Re: Day ahead electricity prices for EU

#290

Post by origin_path »

mytailorisrich wrote: post #93
bjourne wrote: post #60

Remember that, while prices have soared, electricity generation has not become more expensive. The "electricity crisis" is a crisis for European consumers but a massive windfall for producers. This is a market failure - not an electricity failure.

Depends on the country. Certainly this applies to a country like France that produces most of its electricity through nuclear, which they are in the process of fully nationalising. This gives them a lot of leeway to control prices without actually costing them anything.

Of course it costs them! Nationalisation just means the losses of the nuclear industry are born by the taxpayer, which will surface in worse services in other areas.
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