Bidding error sees Finnish day-ahead power price tumble • Hacker News Board

Re: Bidding error sees Finnish day-ahead power price tumble

#111

Post by fulafel » Fri, Nov 24, 2023, 5:58 PM UTC

terom wrote: post #106

https://www.fingrid.fi/sahkomarkkinat/sahkojarjestelman-tila... shows a roughly +1GW (~12GW -> 13GW) rise in consumed power during the first two hours after the price hitting the negative pricing floor (-500€/MWh) at 15:00. Seems like there's some consumer elasticity there, but not enough to make the grid fall over. This is after the national grid operator planned to intervene as necessary and imposed some restrictio…

As a nuance, the grid falling over would not yet result from too much demand, absent other snafus. Rather you have rolling blackouts when loads get disconnected by the grid operator, or if there are failures in implementing those in a orderly way, less orderly blackouts for parts of the grid. These kinds of managed blackouts are common in some parts of the world, eg South Africa, the recent Texas situation, etc.

The frequency of the system is a clear signal about the demand/load match, and if it starts to drop more below some threshold of deviation, loads get disconnected from grid branches.

Of course there can be "interesting times" leading to cascading processes in the multiple interacting automatic failsafes, you can read up on post mortems of grid failures about what kinds of things can go wrong, eg https://en.wikipedia.org/wiki/Northeast_blackout_of_2003#Seq... .. which is why really want to preemptively do the controlled rolling blackouts instead.

The grid falling over would result in a harder, more uncertain and lengthy "black start" process, since plants need power to restart. See eg https://practical.engineering/blog/2022/12/5/what-is-a-black...

Re: Bidding error sees Finnish day-ahead power price tumble

#112

Post by stevekemp » Fri, Nov 24, 2023, 6:05 PM UTC

sigurdjs wrote: post #15

patall wrote: post #10

Earlier quoted context omitted.

They placed a bit at that price doesn't mean the market price will be that high.

It is an auction and everyone pays the same price. During the afternoon tomorrow every household in Finland will be paid significantly for their power usage unless they have a fixed price agreement, which is not that common

I'd suspect that actually fixed-price agreements are very common, and represent the overwhelming majority of contracts for residents/individuals.

I know that after the war started spot-prices rose sharply and a lot of people made the jump. Some, unfortunately, locking themselves into relatively expensive prices.

Re: Bidding error sees Finnish day-ahead power price tumble

#113

Post by stevekemp » Fri, Nov 24, 2023, 6:06 PM UTC

terom wrote: post #105

idiotsecant wrote: post #58

Earlier quoted context omitted.

This is in fact a very good feature. When power is cheap or negative it's because there is more generation than load in some segment of the grid. To fix this you can tell people to stop generating, you can tell people to start loading, or you can just drop the price and let both happen on their own. There are targetted ways this is done when the difference is so big it threatens grid stability, but its often better t…

> There are some things markets are very good at. This is one of them. Ironic in a thread about the market making up a totally imaginary generation surplus. 10-20% of Finnish retail customers are on spot market based contract, and stand to save up to something on the order of 0.40€/kWh consumed (net after taxes and fees) off their electrical bill for the reminder of the day. I suppose every market-rational consumer w…

No need to waste power melting snow, instead we can all turn on our (electric) saunas!

Re: Bidding error sees Finnish day-ahead power price tumble

#114

Post by amluto » Fri, Nov 24, 2023, 6:34 PM UTC

upsuper wrote: post #89

amluto wrote: post #74

Earlier quoted context omitted.

Are there really large solar PV installations that can’t curtail, continuously, all the way to zero? An MPPT ought to be able to operate arbitrarily far away from the maximum power point. Or is there some other limitation that prevents this?

I think it's mainly because of large amount of rooftop solars which are either unable or don't have incentive to curtail, and then there are coal generators already running at their lowest output level.

The grid could, at least in principle, curtail rooftop solar by messing with the frequency. This might be a bad idea.

Re: Bidding error sees Finnish day-ahead power price tumble

#115

Post by grecy » Fri, Nov 24, 2023, 9:04 PM UTC

astrange wrote: post #110

grecy wrote: post #102

Earlier quoted context omitted.

They mandate the price will never go so low they will loose money. Imagined you could buy gas wholesale for a dollar a gallon and the price floor retail was two…. Guranteed to make money

They're losing money if nobody buys from them, because they have overhead to stay open.

If you are guaranteed by law to buy it for less than you can sell it, you can price it mighty low to attract customers and still make money.

It's funny, your comment reads like a business has some kind of right to make a profit, rather than letting the free market figure out if it should exist or not.

Re: Bidding error sees Finnish day-ahead power price tumble

#116

Post by vGPU » Fri, Nov 24, 2023, 9:57 PM UTC

burnerburnito wrote: post #72

vGPU wrote: post #55

Earlier quoted context omitted.

The idea is to buffer changes in price. Started with crops originally iirc. Say I know I need 1 ton of seed for planting. It normally costs $5,000/ton. I am concerned that the rat epidemic might cause a seed shortage. It does. 1 ton of seed next year is worth $20,000. Because I purchased the future of 1 ton of seed for $5,000, I am not affected by this. Made up numbers obviously, as I know someone is just waiting to…

Question: how does that rat case actually work out followed through slightly more? If enough players bought at $5k/ton and the seed shortage increases prices due to scarcity, what happens when there's only enough seeds to meet 3/4ths of demand?

In theory price v demand. Prices would increase until demand was reduced to the point that there was enough seed for everyone willing to pay the price.

It also depends whether you’re trading future that settle for cash (you buy for 5k and they give you 20k cold hard cash) or whether they’re actually going to send a semi truck to your farm, in which case they should have been holding enough collateral for such an incident.

Realistically, I believe most futures are cash settled and you’d probably be better off pocketing the extra 15k and spending 5k on planting a different crop this year.

Re: Bidding error sees Finnish day-ahead power price tumble

#117

Post by yieldcrv » Fri, Nov 24, 2023, 11:56 PM UTC

tovej wrote: post #109

yieldcrv wrote: post #100

Earlier quoted context omitted.

you’re right, sex workers take deposits for this specific reasons and have autonomy and agency, it’s weird and outdated to deny [probably] women that thanks for pointing that out it’s a big plot hole and very much unlike the energy market. although maybe deposits would be an improvement to the energy market

a deposit has nothing to do with it, you need to dump the electricity or the entire grid will have a bad time.

reiterating the analogy

Re: Bidding error sees Finnish day-ahead power price tumble

#118

Post by tovej » Sat, Nov 25, 2023, 11:00 AM UTC

yieldcrv wrote: post #117

tovej wrote: post #109

Earlier quoted context omitted.

a deposit has nothing to do with it, you need to dump the electricity or the entire grid will have a bad time.

reiterating the analogy

no, because it's not your typical cost of carry problem. Oil barrels will not spontaneously combust if you leave them at the plant, and you can control the rate at which you produce them. And the problem is contained at the point at which a seller is left holding the goods.

The electric grid will always distribute the load _somehow_, but the way that happens if there's not enough buyers will have far reaching consequences that are uniuqe to this utility. AND you do not have full control of the production of electricity, which means you don't have the means to react ro a surge unless you have enough sinks distributed _across_ the network.

Re: Bidding error sees Finnish day-ahead power price tumble

#119

Post by sidpatil » Sat, Nov 25, 2023, 12:14 PM UTC

darthrupert wrote: post #78

bongobingo1 wrote: post #44

Earlier quoted context omitted.

Without trying to fall too hard into a potential late-stage-capitalism hole, what is the advantages on trading like this? Beyond the advantages of making money on futures. I guess the buy/sell in advance lets generators etc fund projects ahead of time (maint, expansion, etc) instead of always living hand to mouth on "real time sold" and without having to land "huge multi-year contracts", so the market can be a bit mo…

Like all market activity, the high-level point of all that activity is to derive the real price of the thing being traded. Without falling too far into the late stage central planning thing, this is the mechanism that has been absolutely broken (due to been poorly done by pathetic humans) in all previous attempts at communism. As a tangent, it would be interesting to see if non-pathetic modern computer systems could…

> As a tangent, it would be interesting to see if non-pathetic modern computer systems could actually achieve to implement that mechanism successfully.

You might find this interesting: https://en.m.wikipedia.org/wiki/Project_Cybersyn

Re: Bidding error sees Finnish day-ahead power price tumble

#120

Post by astrange » Sat, Nov 25, 2023, 9:49 PM UTC

grecy wrote: post #115

astrange wrote: post #110

Earlier quoted context omitted.

They're losing money if nobody buys from them, because they have overhead to stay open.

If you are guaranteed by law to buy it for less than you can sell it, you can price it mighty low to attract customers and still make money. It's funny, your comment reads like a business has some kind of right to make a profit, rather than letting the free market figure out if it should exist or not.

> If you are guaranteed by law to buy it for less than you can sell it, you can price it mighty low to attract customers and still make money.

That's not a price floor, it would be a price ceiling on the second level supplier, and they could just choose not to sell. There's no way this scenario could happen except for subsidies and mandated production like the Defense Production Act.

> It's funny, your comment reads like a business has some kind of right to make a profit, rather than letting the free market figure out if it should exist or not.

You seem very confused.