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Maybe I do not understand it fully (ne pas parle de francais), but where do they game the system? You buy cheap when you have storage and sell expensive when d

Maybe I do not understand it fully (ne pas parle de francais), but where do they game the system? You buy cheap when you have storage and sell expensive when demand goes up. Pretty much how the market should work? This way there is incentive to balance it out (by creating storage) - and in this case stabilize the grid. When the grid would become more flexible, so even homeowners can do this with their solar panels and big batteries - then this should be net gain for everyone, no? Unless gaming it, with big money, destabilises it. So some safeguards probably should remain.

dopidopHN 6y ago
You are correct, it's not gaming the system indeed. It's more something that they decided to do on their own, and rightfully so. It's a bit innervating for French tax payers to be on that side of the bargain. But at the same time, we have nuclear power plant, those cannot react that swiftly to market demands changes... it's all fair game. They actually provide some kind of buffer service.
bjourne 6y ago
It's not gaming the system, it is arbitrage. However, it is pretty terrible for producers unable to exploit price swings. E.g a nuclear plant produces electricity at a fixed cost and may sell it at a loss when the price is low, but recoups the losses when the price is high. Since arbitrage smooth out the price peaks, it damages nuclear's profitability. One could say that's too bad for nuclear, others (nuclear lobbyists) say that regulation is needed to prevent electricity arbitrage.
- xboxnolifes 6y ago
  If the fixed price nuclear uses is too low to be profitable, then it must be raised.
- aquark 6y ago
  If nuclear can offer sustained cheaper than average generation then the market would allow a long term fixed price contract — they shouldn’t need to sell their full output at spot rates. Consumers that want predictability could buy on these contracts.

dopidopHN 6y ago

You are correct, it's not gaming the system indeed. It's more something that they decided to do on their own, and rightfully so. It's a bit innervating for French tax payers to be on that side of the bargain. But at the same time, we have nuclear power plant, those cannot react that swiftly to market demands changes... it's all fair game. They actually provide some kind of buffer service.

bjourne 6y ago

It's not gaming the system, it is arbitrage. However, it is pretty terrible for producers unable to exploit price swings. E.g a nuclear plant produces electricity at a fixed cost and may sell it at a loss when the price is low, but recoups the losses when the price is high. Since arbitrage smooth out the price peaks, it damages nuclear's profitability. One could say that's too bad for nuclear, others (nuclear lobbyists) say that regulation is needed to prevent electricity arbitrage.

xboxnolifes 6y ago
If the fixed price nuclear uses is too low to be profitable, then it must be raised.
aquark 6y ago
If nuclear can offer sustained cheaper than average generation then the market would allow a long term fixed price contract — they shouldn’t need to sell their full output at spot rates. Consumers that want predictability could buy on these contracts.