Another example of government regulation crushing the little guys and then blaming them for it
Griddy Is Shutting Down
31–40 of 267 posts
Re: Griddy Is Shutting Down
#32Not a fan of this. People buying electricity at wholesale prices is on them.
I disagree completely. This business model should never have been allowed to exist, in the same way and for the same reason that " almost fully self-driving cars" should not be allowed on the roads: humans are just not capable of quickly and correctly responding in situations where 99.99% of the time no input is required and once in a blue moon you have to act immediately to avoid disaster. Good riddance.
I would love the opportunity to sign up for this, if and only if they could send me some test messages so I could make sure my load-shedding scripts work.
The opportunity to engage more directly with the market would be cool and useful for folks with the technical chops to participate appropriately. And if everyone's smart appliances and bitcoin miners could actually cut themselves off with price spikes, _the grid would be healthier for it_.
I think of it like self-insurance. If you have the financial resources to weather the foreseeable eventualities, you can forego many traditional types of insurance. However, you have to prove that you have the money in the bank.
In this case, there was nobody checking that these wholesale customers had the technical chops to meaningfully participate in the wholesale market. THAT is the problem. The market should exist, but just like you can't register a car without either normal insurance or proving your self-insurability, you shouldn't get electrical service without either paying normal consumer rates or proving your ability to play the wholesale game.
Re: Griddy Is Shutting Down
#33Re: Griddy Is Shutting Down
#34Not a fan of this. People buying electricity at wholesale prices is on them.
It is, but then people couldn't pay -- and since they couldn't pay, neither can Griddy, since it ran cash-lean and didn't extract enough profit during low rate periods to cover this amount of delinquency. The $2.1B shortfall is being assessed equally among resellers, so Griddy acting like they're some victim instead of just another participant is a bit silly. You don't see Encor complaining about the shortfall makeup assessment, despite all of their customers being on fixed-rate.
Re: Griddy Is Shutting Down
#35I wonder why there wasn't some sort of stop-loss pricing (disconnect service if price exceeds X) built into the user agreement. That would have prevented all the negative publicity.
Griddy was a great idea, but it wasn't for everyone. Especially those who don't have backup solar or generators.
Re: Griddy Is Shutting Down
#36Earlier quoted context omitted.
>The problem here as I understand it is that ERCOT stepped in and artificially set an absurdly high wholesale price Incorrect. ERCOT set a price ceiling, not a price. The wholesale price without the ERCOT price ceiling would have been far, far higher than $9000 kwh. That ERCOT is at blame for the price ceiling is absurd . * ERCOT is to blame for a lot of other things though.
https://news.ycombinator.com/item?id=26282576 disagrees with you
I don't think it does. I think you are misreading it.
Re: Griddy Is Shutting Down
#37Earlier quoted context omitted.
The problem here as I understand it is that ERCOT stepped in and artificially set an absurdly high wholesale price, to try to stimulate production. And then Griddy was forced to pass this price straight down to their customers. The narrative about this being a "market failure" seems really wrong. Really seems like it should be on TX to make the customers whole here, given that they ordered Griddy to pass along huge a…
>The problem here as I understand it is that ERCOT stepped in and artificially set an absurdly high wholesale price Incorrect. ERCOT set a price ceiling, not a price. The wholesale price without the ERCOT price ceiling would have been far, far higher than $9000 kwh. That ERCOT is at blame for the price ceiling is absurd . * ERCOT is to blame for a lot of other things though.
Griddy seems to be pretty adamant that PUCT had ERCOT set the price that high.
https://www.griddy.com/post/griddy-update-why-energy-prices-...
It links to source material that mostly reads as gibberish to me but does seem to make clear near the start that PUCT/ERCOT have the power to change the price and were unhappy that it was lower than $9000.
Re: Griddy Is Shutting Down
#38Can someone explain in layman's (or a 5-year-old's) terms what "wholesale electricity" is?
I assume that you're buying straight from the suppliers instead of through the many-tiered energy brokerage that is used down here.
Re: Griddy Is Shutting Down
#39I always thought this was a good idea for a company. Almost all of the electricity providers in Texas all buy energy at wholesale prices and lock customers into long term contracts. If you were an electricity provider, what would be the best plan that you would want for yourself and your friends? My answer to that would be to have access to buy energy at the cheap wholesale prices for a flat monthly fee. This seems t…
It's a good idea if you have a whole-house generator giving you optionality. Even running on diesel, it's only like 50 cents per kWh vs $9/kWh. If you chop off the most expensive part of the curve, wholesale can save you a lot.
It might be a good idea for whole-house generator companies, actually: offer your customers the same thing as Griddy except with the option of automatically switching to your generator if rates get insane. It's actually good for everyone as it reduces grid power consumption.
In fact, I want to see a grid-connected solar/battery/inverter with a dual-fuel (natural gas/propane) generator that feeds into the inverter/charger and then possibly into the grid. That'd be sweet.
A wholesale-only Griddy company could avoid the negative publicity if they only sold to folks with backup power options.
Re: Griddy Is Shutting Down
#40Earlier quoted context omitted.
The problem here as I understand it is that ERCOT stepped in and artificially set an absurdly high wholesale price, to try to stimulate production. And then Griddy was forced to pass this price straight down to their customers. The narrative about this being a "market failure" seems really wrong. Really seems like it should be on TX to make the customers whole here, given that they ordered Griddy to pass along huge a…
>The problem here as I understand it is that ERCOT stepped in and artificially set an absurdly high wholesale price Incorrect. ERCOT set a price ceiling, not a price. The wholesale price without the ERCOT price ceiling would have been far, far higher than $9000 kwh. That ERCOT is at blame for the price ceiling is absurd . * ERCOT is to blame for a lot of other things though.
The price ceiling is/was always set, it wasn't created in the middle of last week.
Pinning the price to the maximum as a last-ditch effort to try to force producers online is what they did last week.