11–20 of 191 posts
Storage is definitely the wise answer here, as the article mentions. The fun answer here is giant crypto farm.
Yeah I had thought surely they can find a use for free electricity rather than just turning it off
EDIT: Whip it around in circles with giant electromagnets.
An explanation of the mechanics of how I'd have to pay somebody else to take my electricity (e.g., a negative rate) would be helpful. As prices approaches 0, I could take the excess electricity and say, mine cryptocurrency. Is nobody considering the arbitrage opportunities here? Take the 0-cost electricity, move water up a hill, and convert it back to electric when it's needed, etc.
The crypto one won’t work because there would only be free electricity half of the time, and the water idea is good but it takes immense capex and time to make
An explanation of the mechanics of how I'd have to pay somebody else to take my electricity (e.g., a negative rate) would be helpful. As prices approaches 0, I could take the excess electricity and say, mine cryptocurrency. Is nobody considering the arbitrage opportunities here? Take the 0-cost electricity, move water up a hill, and convert it back to electric when it's needed, etc.
If you produce more than your share, someone else needs to shutdown.
Shutting down certain power sources (e.g. coal) comes at a non zero cost. Someone still has to pay the power plant that needs to shutdown or send people home unexpectedly. These plants might be have pre secured contracts to sell at a given price over a given time period further adding to the cost of shutting off their supply.
Some more info here:
https://www.epexspot.com/en/company-info/basics_of_the_power...
An explanation of the mechanics of how I'd have to pay somebody else to take my electricity (e.g., a negative rate) would be helpful. As prices approaches 0, I could take the excess electricity and say, mine cryptocurrency. Is nobody considering the arbitrage opportunities here? Take the 0-cost electricity, move water up a hill, and convert it back to electric when it's needed, etc.
There are people that arbitrage this--moving water up a hill is actually how many of them do it.
This stuff is really confusing. My brother trades electricity and has explained it to me numerous times and it's still a little fuzzy.
An explanation of the mechanics of how I'd have to pay somebody else to take my electricity (e.g., a negative rate) would be helpful. As prices approaches 0, I could take the excess electricity and say, mine cryptocurrency. Is nobody considering the arbitrage opportunities here? Take the 0-cost electricity, move water up a hill, and convert it back to electric when it's needed, etc.
Can’t they discharge it for free? Why do they have to pay to send it into the grid? The crypto one won’t work because there would only be free electricity half of the time, and the water idea is good but it takes immense capex and time to make
Water storage would only work if there is a steep mountain or big hill nearby.
Another way to look at negitive pricing is the grid is paying industrial users to burn as much power as they can.
An explanation of the mechanics of how I'd have to pay somebody else to take my electricity (e.g., a negative rate) would be helpful. As prices approaches 0, I could take the excess electricity and say, mine cryptocurrency. Is nobody considering the arbitrage opportunities here? Take the 0-cost electricity, move water up a hill, and convert it back to electric when it's needed, etc.
An explanation of the mechanics of how I'd have to pay somebody else to take my electricity (e.g., a negative rate) would be helpful. As prices approaches 0, I could take the excess electricity and say, mine cryptocurrency. Is nobody considering the arbitrage opportunities here? Take the 0-cost electricity, move water up a hill, and convert it back to electric when it's needed, etc.
Another way to think about it: uses like those you propose that can soak up excess energy in the grid are exactly why energy markets are allowed to float, and even to go negative. If there's a surplus, they want you to use it, and if it were economical to store it and sell it back to the power company later, both they and you would benefit. That this isn't common suggests that it isn't economical.
An explanation of the mechanics of how I'd have to pay somebody else to take my electricity (e.g., a negative rate) would be helpful. As prices approaches 0, I could take the excess electricity and say, mine cryptocurrency. Is nobody considering the arbitrage opportunities here? Take the 0-cost electricity, move water up a hill, and convert it back to electric when it's needed, etc.
In a wholesale electricity market we have a market operator who estimates the demand for the near term future and opens the market up to bids for supply.
Suppliers bid a certain capacity for each period, with the operator typically accepting firm supply offers, contingency supply offers, and ancillary service offers in advance. Since some suppliers are “baseload” (ie: unable to adjust output to suit the current level of demand) they will typically bid low to always be paid for their supply. Everyone else will be affected by these bids because the “baseload” operators are typically not only inflexible but also have huge capacity.
In periods where total demand is low relative to total supply capacity, the wholesale bids will drop to low prices. For the baseload suppliers, they would prefer to pay for someone to use their excess power rather than damage their equipment by either turning it off or reducing output below certain minimums. A baseload supplier might, for example, be facing a maintenance cost of a million dollars versus paying the market a hundred thousand to create extra demand for surplus energy. So rather than turn off equipment they will bid negative prices on the wholesale market.
A second cause of negative wholesale prices is established players with large war chests waging economic war against new entrants. They know solar farms have razor thin margins, so it is worth spending a few tens of million dollars to drive the solar farm bankrupt. Enough negative pricing periods during peak solar capacity means the solar farm is not making any money. If the baseload operator knows roughly the breakeven point for the solar farm, they will know how much they have to spend in order to shut the solar farm out of the market and bankrupt them. There are no rules against this kind of activity in the Australian energy market.
Earlier quoted context omitted.
What's more annoying is we can provide that energy for virtually free, but because it doesn't make someone else profits it gets switched off. EDIT: just to clarify: I mean I wish that solar could be socialised and made into a social commodity. We're becoming increasing dependent on electricity as time passes, almost to the point it'll be difficult to live well without it. If that ever becomes the case, I would want t…
Overloading the grid isn't a good idea, generally speaking
Storage is definitely the wise answer here, as the article mentions. The fun answer here is giant crypto farm.
Yeah I had thought surely they can find a use for free electricity rather than just turning it off