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In Defense of Electricity Markets

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Re: In Defense of Electricity Markets

#131

Post by mschaef »

sidewndr46 wrote: post #116
cyberax wrote: post #5

Counterpoint: electricity markets are terrible for reliability. Markets are great, but there are no pricing signals for reliability. You won't know that your grid will collapse at the first strong breeze, until it happens (see: Texas). Theoretically, it can work because companies might invest in reliable generation, in the hopes of getting $$$$$$$$$ when the spot price goes up through the roof. But in practice, prett…

The Texas grid has not suffered any collapses that I am aware of

?

I can think of at least three. (1989, 2011, 2021)

Maybe you can quibble over the definition of 'collapse', but in each of those three events there was a significant inability of the grid to meet demand (and subsequent involuntary demand curtailment).

Re: In Defense of Electricity Markets

#132

Post by bee_rider »

baq wrote: post #40
bee_rider wrote: post #22

Earlier quoted context omitted.

Invest in both, I don’t think nuclear is the future but wouldn’t mind being wrong. To pay for it, raise taxes on fossil fuels.

It doesn’t look like we have any alternatives in the next three decades until fusion is viable :wink:

Yea it always seems like there’s some technology right around the corner that’s a better plan than the renewables we could be installing right now. Might as well use petrochemicals for another couple quarters!

Re: In Defense of Electricity Markets

#133

Post by tails4e »

frutiger wrote: post #78
ilikerashers wrote: post #63

I don't think they can be defended. In the UK last winter, generators artificially "shut down" to drive up prices. It's a rigged game that hurts consumers: https://www.theguardian.com/business/2023/mar/23/uk-power-fi... The richest people I know (guys in their 30s worth 100 million) all made it through energy trading. Lots of hands in pockets here and is similar to most corrupt privatisation initiatives.

> generators artificially "shut down" to drive up prices Isn’t that an argument for having a proper market with multiple suppliers? Competitors would normally step in to provide supply at non inflated prices to generate greater revenue.

The price for all units sold is set by the highest producer at a any one moment. This led to windfall profits for generators with fixed costs like wind. It's not a functioning market. Imagine if the price of a beer everywhere in the US was set by the highest seller. Every beer sold would be immediately dearer, not cheaper, as it just takes one seller to push the price up.

Re: In Defense of Electricity Markets

#134

Post by ulkhf »

mschaef wrote: post #130
londons_explore wrote: post #110

Earlier quoted context omitted.

> I've read that the overall effect of electricity deregulation is that prices are slightly lower, and reliability is down. One interesting option is the option to let customers choose where they want to be on the reliability vs price scale. Typically, in times of crisis due to undersupply, an electricity network cuts off customers (blackouts). However, this needent happen at the district/region level. It could just…

> One interesting option is the option to let customers choose where they want to be on the reliability vs price scale. ... > t could just as easily be implemented by your own electricity meter - effectively a breaker which opens when it detects crisis. What you're really talking about is demand response. It's been around a while in both commercial and residential settings. It doesn't really address reliability to th…

It addresses reliability by shedding the customers who don't pay a premium for reliability first. Most of the time, that can solve the problem. It is, as you say, imperfect because it doesn't allow that premium to be used to fund investment in reliable generation.

Re: In Defense of Electricity Markets

#135

Post by ulkhf »

cyberax wrote: post #5

Counterpoint: electricity markets are terrible for reliability. Markets are great, but there are no pricing signals for reliability. You won't know that your grid will collapse at the first strong breeze, until it happens (see: Texas). Theoretically, it can work because companies might invest in reliable generation, in the hopes of getting $$$$$$$$$ when the spot price goes up through the roof. But in practice, prett…

When sources were inherently dispatchable, like coal/oil/gas, reliability was free. Markets have not been updated to reflect the value of reliability. It may be just an oversight of slow moving regulators. Or it may be intentional to allow the growth of unreliable wind and solar without making them bear their own cost of unreliability.

Re: In Defense of Electricity Markets

#136

Post by stephen_g »

lysecret wrote: post #10

Electric water heaters have long been in demand response programs, but new upgrades improve their ability to shift energy based on real-time conditions without leaving customers with cold water. Roughly 18% of household energy goes towards water heating, though many buildings still use fuels like natural gas. Would love to hear more on this point. Which companies are doing the integration?

For my house, I put in a heat pump with a decently sized storage tank and all it takes is a simple timer - it comes on at 10am and heats until the tank is at least 60 degrees C (for Legionella prevention).

This works to power it entirely from my solar almost all the time (I've only had it for a year, but I think in that time over 98% of my water heating would have been directly from my solar). Where I am, there tends to be surplus solar energy in the grid at that time anyway, so where I am at least, you don't even need anything super smart that tracks real-time energy pricing or anything. As long as you avoid the morning and evening peak, which this always does (it's finished heating usually well before 1pm, and the peak doesn't usually start until 4pm at the earliest in Winter).

Re: In Defense of Electricity Markets

#137

Post by [deleted] »

RandomLensman wrote: post #37
devjab wrote: post #35

Earlier quoted context omitted.

It sort of depends on what you mean by markets. In most places in Europe the production of power is on the market, but the actual power grid is not freely traded. The grid is instead handed out to semi-permanent monopolies that are heavily regulated and controlled by governments and/or non-profit NGOs that are essentially a way we do efficient government in the supply sector. It works, but the benefit isn’t usually t…

Having very very few grid failures in Germany is a benefit to consumers, too. Price is only one dimension of consumer benefit.

[deleted]

Re: In Defense of Electricity Markets

#138

Post by [deleted] »

tuukkah wrote: post #46
devjab wrote: post #35

Earlier quoted context omitted.

It sort of depends on what you mean by markets. In most places in Europe the production of power is on the market, but the actual power grid is not freely traded. The grid is instead handed out to semi-permanent monopolies that are heavily regulated and controlled by governments and/or non-profit NGOs that are essentially a way we do efficient government in the supply sector. It works, but the benefit isn’t usually t…

The grid is a natural monopoly, so it doesn't make sense to let private companies control it and a market wouldn't work. Electricity production is not a monopoly and can work well as a market, but there needs to be oversight and rules for the trading.

[deleted]

Re: In Defense of Electricity Markets

#139

Post by guappa »

vegardx wrote: post #104
baq wrote: post #38

Earlier quoted context omitted.

Can’t for the life of me understand that particular Scandinavian peculiarity in what would seem otherwise very rational society. I assume it must have been logical or still is?

For most homes and offices the primary source of heating is electrical, so in the winter it doens't really make much difference whether you turn the lights off or not, heat is heat. In the summer there's no excuse though. Old habits die hard, or something like that. That said, modern LED-lighting doesn't really use that much electricity, all lights in my apartment use a total of 100Wh, or 75kWh per month. I could tur…

> For most homes and offices the primary source of heating is electrical

Source? I only know that people in isolated villa use electrical heating. Most apartments get hot water from a nearby garbage incinerator owned by the city.

> But clearly some speculative investment has more utility than me not stumping my toe when going to the bathroom at night.

We were talking about office buildings being fully lit 24h a day. Where nobody sleeps. Nobody is saying people should go to bed at 2pm in the winter.

Re: In Defense of Electricity Markets

#140

Post by vegardx »

guappa wrote: post #139
vegardx wrote: post #104

Earlier quoted context omitted.

For most homes and offices the primary source of heating is electrical, so in the winter it doens't really make much difference whether you turn the lights off or not, heat is heat. In the summer there's no excuse though. Old habits die hard, or something like that. That said, modern LED-lighting doesn't really use that much electricity, all lights in my apartment use a total of 100Wh, or 75kWh per month. I could tur…

> For most homes and offices the primary source of heating is electrical Source? I only know that people in isolated villa use electrical heating. Most apartments get hot water from a nearby garbage incinerator owned by the city. > But clearly some speculative investment has more utility than me not stumping my toe when going to the bathroom at night. We were talking about office buildings being fully lit 24h a day.…

Latest data is from 2012[0], but to counter to my own argument, I have district heating in my apartment. Outside of Oslo or any of the other "larger" cities in Norway I think you're hard pressed at finding anything like that, the population density is so low that it economy of scale for systems like that doesn't work out.

I'm not going to pretend that these office buildings don't exist, but usually they're not really empty. I've yet to be in an office without obnoxious motion sensors that don't work properly so you end up sitting in the darkness when working either early in the morning or late in the evening.

All that said, light pollution is a huge problem here. When I'm out hiking I don't really need a compass or anything to know the direction of Oslo, I can just look at the sky. I think the point I was trying to make is that lighting is a very small percentage of electricity usage, especially now with LED-lighting. In the winter I use the equivalent of 2000kWh/month for heating and hot water. Lighting would be 75kWh if I left all light on, all day, all night.

[0] https://www.ssb.no/energi-og-industri/statistikker/husenergi....

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