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Texas is a great example of what happens in an almost uncontrolled free market. With renewables becoming far cheaper, it makes sense that markets that work off

by bane 11y ago

Texas is a great example of what happens in an almost uncontrolled free market. With renewables becoming far cheaper, it makes sense that markets that work off basic free market economics will adopt them. Texas is pragmatic that way and often provides a very simple model for what it takes to get things adopted without strong regulations forcing the matter. It's a weird state only insomuch that it isn't like everywhere else and is still fairly successful as a territory.

_delirium 11y ago
I'm not sure I'd describe it as an "almost uncontrolled free market", probably something closer to a "state-organized market". There are definitely market mechanisms at work in the Texas energy sector, but also quite a bit of central planning, especially on infrastructure, and especially with wind power. The state has been heavily involved in building out transmission lines to make wind turbine construction in remote areas more attractive, because building a wind turbine nowhere near major transmission lines is obviously not economical, and there are big coordination and right-of-way problems getting all the people who hold land and might want to build turbines to figure out, purely in the private sector, how to get together to finance and build transmission lines. The specific solution Texas has used is to create something called "Competitive Renewable Energy Zones" (CREZs), where the state identifies promising areas and invests heavily in infrastructure to try to jumpstart production, with a plan of recovering the infrastructure spending from tax on that production (once it materializes). About $7 billion in tax money has been spent on that project so far, so the central-planning part of the story isn't exactly small change. Not sure where to link for a good overview, but this article has some information: http://www.texastribune.org/2013/10/14/7-billion-crez-project-nears-finish-aiding-wind-po/ http://www.texastribune.org/2013/10/14/7-billion-crez-projec...
woah 11y ago
Before we get too voluntary here, let's remember that wind power was developed through heavy subsidies from many governments over the years.
- bane 11y ago
  That's kind of the point. The heavy subsidies brought renewables into competition with traditional energy markets in Texas, and voila, Texans (a state not normally associated with renewables) started buying them up. One thing that's not discussed too frequently about renewables is that the operating costs are less variable than fossil fuel based systems. You have a pretty good idea what the costs are going to be over the lifetime of an installation and this helps with planning and deployment. Fossil fuel prices are variable enough over 20 years that you can't plan more than a few months out, or you need to have enough cash reserves in place to weather out price spikes.

by bane 11y ago

_delirium 11y ago

I'm not sure I'd describe it as an "almost uncontrolled free market", probably something closer to a "state-organized market". There are definitely market mechanisms at work in the Texas energy sector, but also quite a bit of central planning, especially on infrastructure, and especially with wind power. The state has been heavily involved in building out transmission lines to make wind turbine construction in remote areas more attractive, because building a wind turbine nowhere near major transmission lines is obviously not economical, and there are big coordination and right-of-way problems getting all the people who hold land and might want to build turbines to figure out, purely in the private sector, how to get together to finance and build transmission lines. The specific solution Texas has used is to create something called "Competitive Renewable Energy Zones" (CREZs), where the state identifies promising areas and invests heavily in infrastructure to try to jumpstart production, with a plan of recovering the infrastructure spending from tax on that production (once it materializes). About $7 billion in tax money has been spent on that project so far, so the central-planning part of the story isn't exactly small change. Not sure where to link for a good overview, but this article has some information: http://www.texastribune.org/2013/10/14/7-billion-crez-project-nears-finish-aiding-wind-po/ http://www.texastribune.org/2013/10/14/7-billion-crez-projec...

woah 11y ago

Before we get too voluntary here, let's remember that wind power was developed through heavy subsidies from many governments over the years.

bane 11y ago
That's kind of the point. The heavy subsidies brought renewables into competition with traditional energy markets in Texas, and voila, Texans (a state not normally associated with renewables) started buying them up. One thing that's not discussed too frequently about renewables is that the operating costs are less variable than fossil fuel based systems. You have a pretty good idea what the costs are going to be over the lifetime of an installation and this helps with planning and deployment. Fossil fuel prices are variable enough over 20 years that you can't plan more than a few months out, or you need to have enough cash reserves in place to weather out price spikes.