3 ms·

In Europe, and I can only assume that it’s similar to the US, the energy market is actually running a surprisingly complicated auction system. For example, sinc

In Europe, and I can only assume that it’s similar to the US, the energy market is actually running a surprisingly complicated auction system. For example, since power generation and consumption have to be balanced at all times, power generation capability that can ramp up and down quickly is more valuable than one with the same nominal power that can only be controlled slowly. As far as I understand, all of this is priced in, with separate auctions for different timescales. What batteries allow you to do is to perform time arbitrage in this market. As with many other forms of arbitrage, this should lower average prices, though some specific current uses could suffer. For example, if this is deployed at scale, electricity might no longer be all that much cheaper at night.

NortySpock 6y ago
Yes, this is sort-of the case in the US, with the quirk that we have 3 major grids: the Eastern Interconnect, the Western Interconnect, and Texas. Within that are individual utility companies: some are traditional top-down utilities that own both generation and poles-and-wires, vs some utilities are competitively bidding generation (and sometimes bidding consumption). Layer on top of that many interconnected "power market areas". https://www.epa.gov/greenpower/us-electricity-grid-markets https://www.epa.gov/greenpower/us-electricity-grid-markets
- 7thaccount 6y ago
  Let me add some detail to your coverage of the interconnects in relation to the more granular power markets. For example, ERCOT (Texas) has a 1:1 relationship with its market, but the rest are different. The Eastern Interconnect has many power markets made up of many many utilities. PJM, NYISO, ISO-NE, SPP, & MISO are the energy markets (called ISOs or RTOs) in the Eastern Interconnect. There is also the government owned TVA and Southern Company which is kinda like a large vertically integrated utility. These markets perform some of the most complex MIP models on the planet in their optimization. FERC Order #841 addresses the incorporation of storage into these markets.

NortySpock 6y ago

Yes, this is sort-of the case in the US, with the quirk that we have 3 major grids: the Eastern Interconnect, the Western Interconnect, and Texas. Within that are individual utility companies: some are traditional top-down utilities that own both generation and poles-and-wires, vs some utilities are competitively bidding generation (and sometimes bidding consumption). Layer on top of that many interconnected "power market areas". https://www.epa.gov/greenpower/us-electricity-grid-markets https://www.epa.gov/greenpower/us-electricity-grid-markets

7thaccount 6y ago
Let me add some detail to your coverage of the interconnects in relation to the more granular power markets. For example, ERCOT (Texas) has a 1:1 relationship with its market, but the rest are different. The Eastern Interconnect has many power markets made up of many many utilities. PJM, NYISO, ISO-NE, SPP, & MISO are the energy markets (called ISOs or RTOs) in the Eastern Interconnect. There is also the government owned TVA and Southern Company which is kinda like a large vertically integrated utility. These markets perform some of the most complex MIP models on the planet in their optimization. FERC Order #841 addresses the incorporation of storage into these markets.