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I had a really fascinating conversation with a leader at a local energy company. He discussed some challenges with pricing in producing electricity that might h
by geoduck14 6y ago
I had a really fascinating conversation with a leader at a local energy company. He discussed some challenges with pricing in producing electricity that might help here.
The BIGGEST expense for a power company is infrastructure. They have all of these electrical lines running everywhere. When they run the lines, they are designed for growth YEARS from now AND for the HIGHEST demand time frame.
This is to say: the company spends LOADS of money to run wires that are 99% unused. The cost of running the wires is a fixed expense that gets passed on to the consumers. As people move to solar power, they stop paying the power company. They stop paying for the electrical lines that were already run and already expensed. This cost is then shifted to the other consumers. Thus raising the cost of electricity for everyone else (in the short term).