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On power markets, snow storms, and $16k power bills

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Re: On power markets, snow storms, and $16k power bills

#81

Post by thinkcontext »

ahepp wrote: post #66

>Those that chose Griddy, chose higher risk, which comes with high potential rewards but also high potential losses When I lived in the poor part of town, "energy deregulation" companies were always coming around, aggressively trying to get me to sign up on the spot. They never talked about risk, they just told me I could sign here to save $100s on my power bill. I asked them about the details and they just lied thro…

As far as I'm aware Griddy's product could only be sold in Texas. Plenty of other states have deregulated residential electricity markets, all of the ones I am familiar with would not allow residential customers to sign up for totally unconstrained rates.

I'd suggest Texas jettison its market fundamentalist politicians and instead elect ones that advocated for proper regulations prior to this event.

Re: On power markets, snow storms, and $16k power bills

#82

Post by cwkoss »

uadnils wrote: post #45

1. The statement "it’s clear that those high prices weren’t doing their job" and subsequent disagreement with raising the price cap does not make sense to me. Any artificial price cap seems to limit the effectiveness of a market. From the producer's side, it limits the incentive to model and capture these tail events (e.g. winterize). From the consumer's side, it limits the incentive to reduce consumption. Is my pers…

For #2, I bet that it would drastically cut into energy company profits and thus is not politically practical in TX.

Re: On power markets, snow storms, and $16k power bills

#83

Post by AnssiH »

martinald wrote: post #37

In the UK energy supplier Octopus has an "agile" tariff which is similar to griddy (we are increasingly getting negative prices here). However, it has a 35p/kWh price cap (2-3x average rates). I don't understand why Griddy didn't do something similar. Even a $1/kWh price cap would have really helped them.

Similar with my provider in Finland, capped at 0.085€/kWh (approx. 2x avg): https://www.sahkolaitos.fi/en/products/tuntisahko/

Re: On power markets, snow storms, and $16k power bills

#84

Post by paulgb »

ahepp wrote: post #72
techsupporter wrote: post #46

Earlier quoted context omitted.

Exactly. In my experience, there are exactly two types of customers on the kinds of plans like Griddy offers: a) people who are heavily into cost-optimization and have spent the cash to automate their living quarters to take advantage of wholesale price swings; and b) people who are trying to stretch a dollar because a single dollar is all they have left. For people in that second category, the dollar broke and smack…

I used to have these guys (EDIT: energy dereg companies, not griddy specifically) knocking on my door regularly with a pen, asking me to sign a contract for real time pricing literally on the spot, because I could save a bunch of money on my bill I would be shocked if there is any energy deregulation company that doesn't resort to this, because it's the basic result of hiring contractors and paying them on commission

Unfortunately energy deregulation seems to disproportionately attract hucksters. I had never heard of Griddy until recently but in NY we have our share of pushy firms with questionable sales.

Question for those in TX: was your perception of Griddy that they were sketchy, or just a get-what-you-pay-for sort of basic service? Did they aggressively sell door-to-door?

Re: On power markets, snow storms, and $16k power bills

#86

Post by renewiltord »

ryanmarsh wrote: post #74
ahepp wrote: post #66

>Those that chose Griddy, chose higher risk, which comes with high potential rewards but also high potential losses When I lived in the poor part of town, "energy deregulation" companies were always coming around, aggressively trying to get me to sign up on the spot. They never talked about risk, they just told me I could sign here to save $100s on my power bill. I asked them about the details and they just lied thro…

Griddy didn't have to beat the bricks like most REP's in Texas. Smart consumers aware of the risk beat a path to their door. Unfortunately, as with anything like this, the followers and fools soon showed up (reminiscent of $GME) and a good thing somehow suddenly became "a scam".

> Unfortunately, as with anything like this, the followers and fools soon showed up (reminiscent of $GME) and a good thing somehow suddenly became "a scam".

Haha, isn't this just the thing? It's the same thing as with Kickstarter, Bountysource, numerous Google betas, etc. The risks are just sitting there visible as all heck, and fools will jump in blind and then scream when the scary event happens.

It has been the best argument for paternalism I've ever seen: not to keep people safe from themselves, but to keep fools away from the rest of us so that we can make intelligent risky decisions.

In fact, I've shifted my view of the accredited investor thing. I am so glad a bunch of blind followers can't just do something dumb and then ruin everything for the rest of us.

Re: On power markets, snow storms, and $16k power bills

#87

Post by bluGill »

samkater wrote: post #68
timgebrally wrote: post #10

Earlier quoted context omitted.

I have solar on my house and in IL we get paid via "net metering": https://www.citizensutilityboard.org/illinois-net-metering/ . The idea is you size a system for your annual energy consumption, and then you don't pay for electricity for the year. If you sold the power back for real-time pricing you'd need a much larger system than your annual consumption. Net metering basically lets you sell the power back at a reta…

From what I understand there is a lot of variation in providers. As I understand SDGE's Net Metering policy( https://www.sdge.com/residential/solar/getting-started-with-... ), you sell back power at retail prices only for the current month's billing cycle. Excess energy created within a billing cycle is "true-upped" at wholesale prices which can be applied to other month's billing cycles. I would also be curious in h…

The rules in Illinois are you net meter for the year. If you make more than you use in a year that is free power for the utility. If you want a different deal you need a contract with the utility (In general you need to be in the millions of dollars/year range to be of interest). In Texas it is more complex as each provider can give you a different deal for residential systems.

When the grid is down you can't sell power back. The whole system shuts down. Though if you have a whole house battery backup you can use that instead of the grid (if it is built for it - solar gets weird if you aren't using exactly as much power as you make so you need something to use or make up the difference).

Re: On power markets, snow storms, and $16k power bills

#88

Post by function_seven »

cwkoss wrote: post #82
uadnils wrote: post #45

1. The statement "it’s clear that those high prices weren’t doing their job" and subsequent disagreement with raising the price cap does not make sense to me. Any artificial price cap seems to limit the effectiveness of a market. From the producer's side, it limits the incentive to model and capture these tail events (e.g. winterize). From the consumer's side, it limits the incentive to reduce consumption. Is my pers…

For #2, I bet that it would drastically cut into energy company profits and thus is not politically practical in TX.

Even a non-profit utility would not agree to be the fixed rate provider in this scenario. It would be a guaranteed money loser, for the same reason that I can’t buy auto insurance just after I crash my car, or health coverage just after I’m diagnosed with cancer.

Re: On power markets, snow storms, and $16k power bills

#89

Post by Faaak »

mortenjorck wrote: post #4

Is there a reason why time-of-use systems can’t have a customer-defined price limit, beyond which they opt into a blackout? The sense I got from the stories of people suddenly facing five-figure power bills is that most would have gladly spent a night or two with propane and candles rather than cleaning out their savings.

France's Linky has a built-in relay that the TSO can use to shed some power in the event of an emergency. I suppose that it could be used by a novel energy supplier to pay less in power reserve and they could shut off willing consumers in the event of a near blackout.

Re: On power markets, snow storms, and $16k power bills

#90

Post by jeffrallen »

woeirua wrote: post #54

The big takeaway from all of this should be the critical cyclic dependency of natural gas power plants. That is, if your primary source of power is natural gas, then you must have reliable power to the natural gas wells to produce natural gas. If the power becomes unreliable, then natural gas pressures in the pipelines drop to unsuitable levels to run large generators. As the generators trip due to adverse safety con…

Nuclear is not: it needs grid power to be able to run.
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