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I question how a public utility can be viable where a private one can't. In theory similar market forces should apply to both, and commodity prices should be cl

I question how a public utility can be viable where a private one can't. In theory similar market forces should apply to both, and commodity prices should be close to the cost of production so the prices offered under competition should be close. Why can't we let private companies do whatever we were going to let the public one do? Frankly rather than the hack of setting up a public utility I'd perfer straight up price controls, no reason to build out alternative infrastructure at taxpayer expense, but there might be a quicker fix with some modifications to a few regulations. Still this is better than nothing, just feels overly complicated.

lmm 3y ago
> I question how a public utility can be viable where a private one can't. In theory similar market forces should apply to both, and commodity prices should be close to the cost of production so the prices offered under competition should be close. Natural monopoly means there is no (or at least insufficient) competition. So either you get accountability by having it be publicly-run, or you end up with very little accountability at all. > Why can't we let private companies do whatever we were going to let the public one do? Private companies are very good at coming up with things you never thought of in order to make a profit - that's the whole reason private industry can be more efficient than public ones in the first place. But when most of the creative things they could come up with would be profiting at the expense of the public (because in a monopoly position there's essentially no incentive to treat consumers well), the profit motive does more harm than good and it's better to take it out of the picture. > Frankly rather than the hack of setting up a public utility I'd perfer straight up price controls, no reason to build out alternative infrastructure at taxpayer expense, but there might be a quicker fix with some modifications to a few regulations. That's how you get loopholes that then get exploited worse than the problem you were originally trying to fix.
ThrowawayTestr 3y ago
> I question how a public utility can be viable where a private one can't. The lack of need to make a profit for one thing
ffgjgf1 3y ago
> I'd perfer straight up price controls EU is a good case study. Countries which abandoned price controls but instead have a single (usually state owned) company which controls the grid and a bunch of companies which sell power to consumers (effectively renting the grid) tend to have lower prices than those that didn’t. e.g. I can get a plan which is: Wholesale hourly market price + €0.08 fee to the grid company + €0.02 to the power company.
- cool_dude85 3y ago
  No offense but in what world would a residential customer want exposure to wholesale electric market fluctuations. Like what's the appeal.
  - ffgjgf1 3y ago
    Having an EV would be the main reason, I assume. Wholesale prices are often close to zero or even negative on some nights or on very sunny days during weekends. It might also be worth if you have some heating/cooling system and stuff like that. If your usage patterns are closer to the average you probably won’t save more than 2-3 cents per kWh but taken on significant risk so it’s probably not worth it.

lmm 3y ago

> I question how a public utility can be viable where a private one can't. In theory similar market forces should apply to both, and commodity prices should be close to the cost of production so the prices offered under competition should be close. Natural monopoly means there is no (or at least insufficient) competition. So either you get accountability by having it be publicly-run, or you end up with very little accountability at all. > Why can't we let private companies do whatever we were going to let the public one do? Private companies are very good at coming up with things you never thought of in order to make a profit - that's the whole reason private industry can be more efficient than public ones in the first place. But when most of the creative things they could come up with would be profiting at the expense of the public (because in a monopoly position there's essentially no incentive to treat consumers well), the profit motive does more harm than good and it's better to take it out of the picture. > Frankly rather than the hack of setting up a public utility I'd perfer straight up price controls, no reason to build out alternative infrastructure at taxpayer expense, but there might be a quicker fix with some modifications to a few regulations. That's how you get loopholes that then get exploited worse than the problem you were originally trying to fix.

ThrowawayTestr 3y ago

> I question how a public utility can be viable where a private one can't. The lack of need to make a profit for one thing

ffgjgf1 3y ago

> I'd perfer straight up price controls EU is a good case study. Countries which abandoned price controls but instead have a single (usually state owned) company which controls the grid and a bunch of companies which sell power to consumers (effectively renting the grid) tend to have lower prices than those that didn’t. e.g. I can get a plan which is: Wholesale hourly market price + €0.08 fee to the grid company + €0.02 to the power company.

cool_dude85 3y ago
No offense but in what world would a residential customer want exposure to wholesale electric market fluctuations. Like what's the appeal.
- ffgjgf1 3y ago
  Having an EV would be the main reason, I assume. Wholesale prices are often close to zero or even negative on some nights or on very sunny days during weekends. It might also be worth if you have some heating/cooling system and stuff like that. If your usage patterns are closer to the average you probably won’t save more than 2-3 cents per kWh but taken on significant risk so it’s probably not worth it.