Comment by elzbardico
2 days ago
Jesus! Why finance people are so hell-bent in extracting rent from every single thing, pervert it, make sure the incentives are all pointed to the shortest run while socializing all the costs to the rest of us?
2 days ago
Jesus! Why finance people are so hell-bent in extracting rent from every single thing, pervert it, make sure the incentives are all pointed to the shortest run while socializing all the costs to the rest of us?
If this was implemented in full scale, then it would .. stabilize energy prices towards the mean, and make the energy transmission more stable and resilent in general. I'd happily pay some overhead for that, as it also mean the network can accept more cheap energy sourced from wind and solar.
This is the kind of thing that is funding the massive expansion in renewable energy build-out at the moment. The whole reason there's an energy transition happening is that solar and wind and batteries are cheap enough you can make a lot of money building them, and that'll remain true until basically the whole grid is renewable (finally kicking out the expensive gas turbines), and the average price drops to reach cost of supply.
(And the kind of optimisation that happens with this kind of paper is really in the margins stuff. It generally helps the predictive power of the grid, and usually doesn't make much money once more than one group starts doing it, since it's pretty cheap to run and the margins shrink quickly)
Smart People with money are willing to give it to people if they can make them more money.
Why would anyone give them money if they were just going to throw up their hands and go ‘well, nothing we can do I guess!’.
There is of course the risk that the money gets burned instead of more money getting made, which is the risk in risk/reward.
Rent seeking type behavior tends to happen when there are no obvious ‘green field’ type endeavors to invest in. Or when risk appetites are trending negative.
Note - many of those people with money that want to use it to make more money are retirees, pension funds, etc.
More money made with batteries means more batteries installed. How is that a bad thing?
Profit motive commonly has obscene consequences, like destroying food instead of using it to feed the hungry.
This tends to more to do with food supply security and costs of distribution than anything else (as well as political opposition to socialising food supply).
i.e. if we want to avoid food shortages, we need to overproduce the raw goods and therefore waste some. Transporting and transforming those raw goods into food that someone can eat still costs money, it's not just so farmers can get paid. We probably should still actually make sure no-one goes hungry, but that does actually involve some cost and effort on the part of the government, and the challenge there is mainly political elements who don't like the idea of someone getting something for free.
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While true that it happens in certain cases, the onus of showing that it would be the case in this specific case is still on you.
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No need of speculators. A utility purchases cheap off peak power and extremely costly peak power and pass the costs to the consumer. If the utility pays homeowner with BESS something comparable to peak power rate, they can recover their investment quickly.
Such an utility would be a speculator.
Except this is exactly what you want to happen. The reason electricity prices range is because of supply and demand. Batteries help smooth out the supply curve.
In the short term adding more batteries may allow someone to generate income using this strategy but long term what it will do is push electricity prices down and prevent power generation from being overwhelmed. As the battery "market" gets crowded profit margins will fall and everything will reach an equilibrium.
This is a great demonstration of how capitalism works and why it's beneficial.
Negative prices are mostly caused by unreasonable terms towards generation plants. E.g.: requiring the grid to take every kWh generated and paying a fixed price over a 20-year term. This of course encourages capacity to be built with no flexibility. Why not dump your solar power into the grid? You're getting paid, the state guarantees for that... the negative prices are someone's elses problem.
Capitalism is the only form of communism that works on longer time frames. Periodic resets are still needed, otherwise the monopolist becomes the ruler.