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With you on decarbonised, can at least get behind digitised, but why decentralized? Two significant functions of the electrical utility business are clear natur

With you on decarbonised, can at least get behind digitised, but why decentralized? Two significant functions of the electrical utility business are clear natural monopolies, transmission and distribution. Markets and competition on the generation side have proven to be very difficult to manage, e.g. in California with Enron and the recent Texas ice storms. It seems like a situation where there is a clear central authority, and one that in many places historically has been government-owned and at least in theory democratically accountable to the people. So why not let the utility company manage storage, transfers between different houses, etc.? What's the upside of a bunch of connected microgrids?

EGreg 6y ago
That’s what we said about phone companies. They were the canonical example of natural monopolies and packet switching + VOIP dropped the costs down to nearly zero. We videoconference across continents instead of $3 a minute audio that ties up the lines. Energy generation and cell signals should be decentralized. We have 5 transformers in the USA that — if they go down — the entire grid goes too. An EMP or Carrington Event can take out long running power lines. A Chinese “stuxnet” can sabotage nuclear reactors etc. See video for more info: https://www.youtube.com/watch?v=WzMm7-j7yIY https://www.youtube.com/watch?v=WzMm7-j7yIY
jnsaff2 6y ago
Well electricity takes the lowest resistance path (read shortest). I have solar panels and my neighbor uses electricity to heat their home. So my solar panels heat their house, but the DSO gets to charge the neighbor as much as if the electricity would come from across the country for transmission. If we'd move the meter a bit further we could share. Plus the energy company I sell to and they buy from charges something as well. If we could cut out two middlemen the I would earn the same but their bill would be about 25-50% smaller. Which incidentally you could invest in on-prem batteries and I would use their battery energy to heat my home during the night. Little microgrid community. Scale that up to a neighborhood and the effects start to add up quite nicely. But I do agree with you that integrated grids that span large areas are essential for grid stability and increase the odds of clean energy is being produced at all times needed.
- phicoh 6y ago
  At the end of the day, the capacity of the grid has to be such that you can deal with the worst case situation. So the grid has to handle the case where it is cold and your solar panels are off line. This means that your neighbor would still have to pay for the grid even if they would directly get electricity from you.
- cool_dude85 6y ago
  You might save 25% on your bill, but put the meter any farther up the line and wait for a natural disaster to hit, for example. Get a quote to have you and your neighbor's pole, transformer, etc. fixed up and then figure out what you saved. Heck, you can probably just wait to replace you and your neighbor's transformer and see. Keep putting your meter further up the line, to get the economies of scale needed so your microgrid can have lineworkers, engineers, meter readers (for all your own meters, you have to portion costs out to the individuals in the grid)... congratulations, you just made a new utility company.
snickmy 6y ago
Imho, there are couple of important underlying reasons why we see a centralized grid as a well functioning one. It is a mature system. Having been operating in the space for over 100 years, it is true that the current grid systems are extremely well operated. Yes, even the Western NA and the ERCON (Texas one). They have a very complex system of ancillary services in places, order value of generation based on conditions, etc, etc. It is also true that having a multi time zones footprint (and multiple geographies) allows for interesting properties. For instance, Denmark energy produced through offshore wind turbines is sent to Norway (equivalent to LA - SEATTLE distance) to be transformed into hydro storage. So why do we need decentralisation? First of all, there are places where a central grid don’t exists. You can think about Africa, but also some rural areas of US. Having the traditional grid reaching those places is simply not economical feasible. Secondly, while a country level grid is operated effectively, is not always efficient. There are plenty of energy transformation (from DC to AC, but also different voltage conversion, etc). And then there is the OMH low, and energy loss through resistance of the material used to transmit it. To be honest, is not that microgrids don’t have loss, but there are definitely less conversions, and shorter distances to travel Thirdly is resiliency and robustness. If we push for smaller decentralised grids, we are pushing for an extra level of redundancy in the operations, for instance by increasing adoption of residential/neighborhood storage solutions. If one of those microgrids goes down, there are no chain reactions, or tip-over effects, which today are quite common in a centrally operated grid. Lastly, it’s about innovations. Central grid systems have made us ‘lazy’. Energy prices have been going up, but slowly enough that we haven’t been really bothered by them (boiling-the-frog effect). In markets where the traditional grid was not as present/robust, innovation has moved way faster. For example, is no surprise that the majority of residential storage solutions companies are based in Australia, where they are experimenting with multiple chemical compounds (zinc, bromine, titanate, etc) as well as different architectures (ie. Hydrogen)
- tablespoon 6y ago
  > First of all, there are places where a central grid don’t exists. You can think about Africa, but also some rural areas of US. I'm guessing those areas in the US are more wilderness than "rural." The US has been working on rural electrification for more than 80 years: https://en.wikipedia.org/wiki/Rural_Electrification_Act https://en.wikipedia.org/wiki/Rural_Electrification_Act. According to that article, 90% of farm homes were already electrified 62 years ago.
phicoh 6y ago
I wonder if it makes sense to separate the generation of power from the sale of power to consumers (and of course there is a separate transmission/distribution network as well). The transmission/distribution network is natural monopoly so that needs to be regulated. Generation of power can be free, to allow different techniques to optimize. However, the companies that sell power to consumers should be regulated. There can be many of those companies but each company should be required to have a plan in how to provide power even in adverse conditions (and with significant penalties if they fail). Then those power companies can contract enough generation capacity to have redundancy and sell the excess capacity to industry.

EGreg 6y ago

That’s what we said about phone companies. They were the canonical example of natural monopolies and packet switching + VOIP dropped the costs down to nearly zero. We videoconference across continents instead of $3 a minute audio that ties up the lines. Energy generation and cell signals should be decentralized. We have 5 transformers in the USA that — if they go down — the entire grid goes too. An EMP or Carrington Event can take out long running power lines. A Chinese “stuxnet” can sabotage nuclear reactors etc. See video for more info: https://www.youtube.com/watch?v=WzMm7-j7yIY https://www.youtube.com/watch?v=WzMm7-j7yIY

jnsaff2 6y ago

Well electricity takes the lowest resistance path (read shortest). I have solar panels and my neighbor uses electricity to heat their home. So my solar panels heat their house, but the DSO gets to charge the neighbor as much as if the electricity would come from across the country for transmission. If we'd move the meter a bit further we could share. Plus the energy company I sell to and they buy from charges something as well. If we could cut out two middlemen the I would earn the same but their bill would be about 25-50% smaller. Which incidentally you could invest in on-prem batteries and I would use their battery energy to heat my home during the night. Little microgrid community. Scale that up to a neighborhood and the effects start to add up quite nicely. But I do agree with you that integrated grids that span large areas are essential for grid stability and increase the odds of clean energy is being produced at all times needed.

phicoh 6y ago
At the end of the day, the capacity of the grid has to be such that you can deal with the worst case situation. So the grid has to handle the case where it is cold and your solar panels are off line. This means that your neighbor would still have to pay for the grid even if they would directly get electricity from you.
cool_dude85 6y ago
You might save 25% on your bill, but put the meter any farther up the line and wait for a natural disaster to hit, for example. Get a quote to have you and your neighbor's pole, transformer, etc. fixed up and then figure out what you saved. Heck, you can probably just wait to replace you and your neighbor's transformer and see. Keep putting your meter further up the line, to get the economies of scale needed so your microgrid can have lineworkers, engineers, meter readers (for all your own meters, you have to portion costs out to the individuals in the grid)... congratulations, you just made a new utility company.

snickmy 6y ago

Imho, there are couple of important underlying reasons why we see a centralized grid as a well functioning one. It is a mature system. Having been operating in the space for over 100 years, it is true that the current grid systems are extremely well operated. Yes, even the Western NA and the ERCON (Texas one). They have a very complex system of ancillary services in places, order value of generation based on conditions, etc, etc. It is also true that having a multi time zones footprint (and multiple geographies) allows for interesting properties. For instance, Denmark energy produced through offshore wind turbines is sent to Norway (equivalent to LA - SEATTLE distance) to be transformed into hydro storage. So why do we need decentralisation? First of all, there are places where a central grid don’t exists. You can think about Africa, but also some rural areas of US. Having the traditional grid reaching those places is simply not economical feasible. Secondly, while a country level grid is operated effectively, is not always efficient. There are plenty of energy transformation (from DC to AC, but also different voltage conversion, etc). And then there is the OMH low, and energy loss through resistance of the material used to transmit it. To be honest, is not that microgrids don’t have loss, but there are definitely less conversions, and shorter distances to travel Thirdly is resiliency and robustness. If we push for smaller decentralised grids, we are pushing for an extra level of redundancy in the operations, for instance by increasing adoption of residential/neighborhood storage solutions. If one of those microgrids goes down, there are no chain reactions, or tip-over effects, which today are quite common in a centrally operated grid. Lastly, it’s about innovations. Central grid systems have made us ‘lazy’. Energy prices have been going up, but slowly enough that we haven’t been really bothered by them (boiling-the-frog effect). In markets where the traditional grid was not as present/robust, innovation has moved way faster. For example, is no surprise that the majority of residential storage solutions companies are based in Australia, where they are experimenting with multiple chemical compounds (zinc, bromine, titanate, etc) as well as different architectures (ie. Hydrogen)

tablespoon 6y ago
> First of all, there are places where a central grid don’t exists. You can think about Africa, but also some rural areas of US. I'm guessing those areas in the US are more wilderness than "rural." The US has been working on rural electrification for more than 80 years: https://en.wikipedia.org/wiki/Rural_Electrification_Act https://en.wikipedia.org/wiki/Rural_Electrification_Act. According to that article, 90% of farm homes were already electrified 62 years ago.

phicoh 6y ago

I wonder if it makes sense to separate the generation of power from the sale of power to consumers (and of course there is a separate transmission/distribution network as well). The transmission/distribution network is natural monopoly so that needs to be regulated. Generation of power can be free, to allow different techniques to optimize. However, the companies that sell power to consumers should be regulated. There can be many of those companies but each company should be required to have a plan in how to provide power even in adverse conditions (and with significant penalties if they fail). Then those power companies can contract enough generation capacity to have redundancy and sell the excess capacity to industry.