16 ms·

Here in CA, you have three components to your bill: generation, transmission, and distribution. Adjusted for inflation, generation costs are going down (where

by ghouse 8y ago

Here in CA, you have three components to your bill: generation, transmission, and distribution. Adjusted for inflation, generation costs are going down (where true competition exists), while the transmission and distribution costs are going up. More information: https://www.forbes.com/sites/joshuarhodes/2018/04/30/no-wind-and-solar-do-not-inherently-increase-electricity-prices/#261108897b8b https://www.forbes.com/sites/joshuarhodes/2018/04/30/no-wind...

reaperducer 8y ago
* generation, transmission, and distribution* For those of us not in this space, what's the difference between transmission and distribution?
- jorgen123 8y ago
  Generalizing/simplifying: Transmission is long distance - high voltage, think steel towers with wires. Distribution is from a local transformer (substation) where high voltage gets turned to lower voltage (12 kV) and then sent via utility poles to your home. Near your home there will be a utility pole with a transformer that brings the voltage down to 110. You share that transformer with a handful of neighbors.
  - FractalLP 8y ago
    Your answer is good. To add to it, the large "transmission" grid usually covers extremely high voltage lines: 115 kV, 138kV, 230kV, 345kV, 500kV, 765kV and up. It is managed by both utilities and RTO/ISO organizations that manage large sections like air-traffic controllers. Distribution is typically below ~100kV and is really more in the 11kV range and managed by the utilities almost exclusively. Building new transmission lines can be ~$1 billion projects.
woolvalley 8y ago
I have an acquaintance that works a PG&E, and he said something to the effect that the infrastructure cost for the electric grid is what actually costs money, and the actual generation cost is relatively negligible. The customer cost structure although is inverted based on generation, and not on grid fees. He also talked about how the CA govt uses them as a subsidy funding source and that can create a state where PG&E is close to insolvency sometimes. He also talked about the utility death spiral: https://www.greentechmedia.com/articles/read/this-is-what-the-utility-death-spiral-looks-like https://www.greentechmedia.com/articles/read/this-is-what-th...
- toomuchtodo 8y ago
  Utilities will have to come to the realization that they will transition into small scale ISO/grid operator roles vs monopolies that get a guaranteed return on generation and transmission.
- dragonwriter 8y ago
  > The customer cost structure although is inverted based on generation, and not on grid fees. He also talked about how the CA govt uses them as a subsidy funding source and that can create a state where PG&E is close to insolvency sometimes. PG&E has expended large sums on lobbying, particularly against expansion of public power companies into areas PG&E currently serves. Presumably your friend would explain this has PG&E charitably protecting it's opportunity to lose money, but I think that doesn't quite reflect the reality.
  - azernik 8y ago
    Precisely the opposite. The issue is that this distorted cost structure really doesn't work in a market where there's cost competition on the generation side and customers are being exposed to that competition, as PG&E's cost doesn't go down by nearly as much as customer's bills when cheaper energy sources are used. Their distortion of public policy through lobbying is a bad thing, but their incentives are actually pretty understandable given the wacko market structure.
    - dragonwriter 8y ago
      > The issue is that this distorted cost structure really doesn't work in a market where there's cost competition on the generation side and customers are being exposed to that competition, as PG&E's cost doesn't go down by nearly as much as customer's bills when cheaper energy sources are used. That doesn't explain why, if the market is regulated in such a way that PG&E is losing money serving customers to the point of near insolvency, they spend large amounts of money fighting the transfer of those money-losing customers to expansion of municipal utilities.
gregable 8y ago
In theory, if you can pair generation and consumption more locally (such as a solar roof powering the car sitting under it), transmission costs can drop as well. In the small scale, producing infrastructure that can bill your meter going both ways only increases the cost. But in the large scale, not having to build and maintain more high-power distribution towers across hundreds of miles of difficult to access terrain decreases cost.
- icebraining 8y ago
  I'm a layman, but renewables only seem to me to make that worse, not better. You can't plop down a coal plant in a city, but you still have some freedom to choose its location, and you can scale it to the needs of the local area and just burn as much as you need. Meanwhile, solar and wind might go way down for a whole day or more, and so you need to ship energy from where it's being generated.
  - gregable 8y ago
    Renewables do make for more intermittent supplies of power. However EVs have the potential to smooth that out. Charging speeds across a city can float somewhat with available power and most consumers will not care or even notice. At some point those cars can actually be part of the grid's storage capacity, if the infrastructure is built to allow the car to put some of it's capacity back onto the grid during low availability. EV drivers willing to have 20% of their battery be drained when they need to drive can get paid a small amount for leaving their vehicle plugged in while not in use.

by ghouse 8y ago

reaperducer 8y ago

* generation, transmission, and distribution* For those of us not in this space, what's the difference between transmission and distribution?

jorgen123 8y ago
Generalizing/simplifying: Transmission is long distance - high voltage, think steel towers with wires. Distribution is from a local transformer (substation) where high voltage gets turned to lower voltage (12 kV) and then sent via utility poles to your home. Near your home there will be a utility pole with a transformer that brings the voltage down to 110. You share that transformer with a handful of neighbors.
- FractalLP 8y ago
  Your answer is good. To add to it, the large "transmission" grid usually covers extremely high voltage lines: 115 kV, 138kV, 230kV, 345kV, 500kV, 765kV and up. It is managed by both utilities and RTO/ISO organizations that manage large sections like air-traffic controllers. Distribution is typically below ~100kV and is really more in the 11kV range and managed by the utilities almost exclusively. Building new transmission lines can be ~$1 billion projects.

woolvalley 8y ago

I have an acquaintance that works a PG&E, and he said something to the effect that the infrastructure cost for the electric grid is what actually costs money, and the actual generation cost is relatively negligible. The customer cost structure although is inverted based on generation, and not on grid fees. He also talked about how the CA govt uses them as a subsidy funding source and that can create a state where PG&E is close to insolvency sometimes. He also talked about the utility death spiral: https://www.greentechmedia.com/articles/read/this-is-what-the-utility-death-spiral-looks-like https://www.greentechmedia.com/articles/read/this-is-what-th...

toomuchtodo 8y ago
Utilities will have to come to the realization that they will transition into small scale ISO/grid operator roles vs monopolies that get a guaranteed return on generation and transmission.
dragonwriter 8y ago
> The customer cost structure although is inverted based on generation, and not on grid fees. He also talked about how the CA govt uses them as a subsidy funding source and that can create a state where PG&E is close to insolvency sometimes. PG&E has expended large sums on lobbying, particularly against expansion of public power companies into areas PG&E currently serves. Presumably your friend would explain this has PG&E charitably protecting it's opportunity to lose money, but I think that doesn't quite reflect the reality.
- azernik 8y ago
  Precisely the opposite. The issue is that this distorted cost structure really doesn't work in a market where there's cost competition on the generation side and customers are being exposed to that competition, as PG&E's cost doesn't go down by nearly as much as customer's bills when cheaper energy sources are used. Their distortion of public policy through lobbying is a bad thing, but their incentives are actually pretty understandable given the wacko market structure.
  - dragonwriter 8y ago
    > The issue is that this distorted cost structure really doesn't work in a market where there's cost competition on the generation side and customers are being exposed to that competition, as PG&E's cost doesn't go down by nearly as much as customer's bills when cheaper energy sources are used. That doesn't explain why, if the market is regulated in such a way that PG&E is losing money serving customers to the point of near insolvency, they spend large amounts of money fighting the transfer of those money-losing customers to expansion of municipal utilities.

gregable 8y ago

In theory, if you can pair generation and consumption more locally (such as a solar roof powering the car sitting under it), transmission costs can drop as well. In the small scale, producing infrastructure that can bill your meter going both ways only increases the cost. But in the large scale, not having to build and maintain more high-power distribution towers across hundreds of miles of difficult to access terrain decreases cost.

icebraining 8y ago
I'm a layman, but renewables only seem to me to make that worse, not better. You can't plop down a coal plant in a city, but you still have some freedom to choose its location, and you can scale it to the needs of the local area and just burn as much as you need. Meanwhile, solar and wind might go way down for a whole day or more, and so you need to ship energy from where it's being generated.
- gregable 8y ago
  Renewables do make for more intermittent supplies of power. However EVs have the potential to smooth that out. Charging speeds across a city can float somewhat with available power and most consumers will not care or even notice. At some point those cars can actually be part of the grid's storage capacity, if the infrastructure is built to allow the car to put some of it's capacity back onto the grid during low availability. EV drivers willing to have 20% of their battery be drained when they need to drive can get paid a small amount for leaving their vehicle plugged in while not in use.