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In Europe it is distinctly less risky as you get arbitrage between different parts of the grid. You make money as long as their is a price difference. The tec

by 7952 5y ago

In Europe it is distinctly less risky as you get arbitrage between different parts of the grid. You make money as long as their is a price difference. The technology is well understood. California is hardly a good case study. I think the way grids develop does still depend on local factors. In the UK rural substations have quickly become constrained and have limited export capacity. Urban areas have more capacity and are seeing peaker and battery installation. But large arrays of solar and wind just need a big connection to get power from the middle of nowhere into big cities. Places where land for batteries or peakers will be super expensive and where solar and wind are impossible. Also, if you are going to setup this kind of generation why bother selling to the public anyway. Find a ceramics factory or an steel works and run a private wire. You get a guaranteed customer who will agree prices years in advance.

eru 5y ago
> In Europe it is distinctly less risky as you get arbitrage between different parts of the grid. You make money as long as their is a price difference. Yes, and in theory, the market can decide whether spatial arbitrage via long interconnections or temporal arbitrage (via batteries, shutting off industrial consumers, pre-running air-cons, etc) is better. Perhaps a combination of approaches will prevail: The different arbitrage opportunities mostly make money off the price spikes they can smooth. Simplified: the first long range cable you install earns the most money, because it can pick off the highest spikes. The second cable will cost just as much as the first one to install, but will have to find its profits in a world with already slightly blunted price spikes. Similarly for batteries. But eg batteries and long cables can pick off slightly different spikes, and the back-and-forth flow in cables doesn't have to average out to zero (like batteries do).

by 7952 5y ago

eru 5y ago

> In Europe it is distinctly less risky as you get arbitrage between different parts of the grid. You make money as long as their is a price difference. Yes, and in theory, the market can decide whether spatial arbitrage via long interconnections or temporal arbitrage (via batteries, shutting off industrial consumers, pre-running air-cons, etc) is better. Perhaps a combination of approaches will prevail: The different arbitrage opportunities mostly make money off the price spikes they can smooth. Simplified: the first long range cable you install earns the most money, because it can pick off the highest spikes. The second cable will cost just as much as the first one to install, but will have to find its profits in a world with already slightly blunted price spikes. Similarly for batteries. But eg batteries and long cables can pick off slightly different spikes, and the back-and-forth flow in cables doesn't have to average out to zero (like batteries do).