6 ms·

The original idea behind this is sound. Because production and consumption must net to ~0, from the grid's perspective cutting load is just as valuable as provi

by lukev 3y ago

The original idea behind this is sound. Because production and consumption must net to ~0, from the grid's perspective cutting load is just as valuable as providing generative capacity. Imagine you own a factory that typically runs 24/7 and is part of the system's base load. There is a material cost for you to shut down production. These structures were set up to make it economically viable to have these types of installations shut down in extreme events and function as "virtual power plants" (remember, lowering base load is physically and economically equivalent to providing additional generation.) So far, this kind of makes sense. But unfortunately the same framework can also be applied to cryptocurrency operations, where it really does not make intuitive sense. Largely, IMO, because Bitcoin is so piggish for energy for so little societal value to start with.

no_wizard 3y ago
I have a friend who works in the energy industry specifically targeting power grid management. It is far easier for power companies to manage power loss for things with consistent power usage (low variance) than high variance / inconsistent power loads. Businesses tend to be very consistent, even if their power draw is high, like manufacturing or hospitals etc. Residential power tends to be more variant and harder to fine tune for because it can spike quite suddenly in unexpected ways and tends to add more base load over time. Therefore, it’d actually make more sense for power companies to buy people homes in other states if lowering base load is a concern, since residential is where all the major issues are for load balancing, no?
- drewchew 3y ago
  Would it help if the state were to provide tax incentives for in home battery backups?
  - boringg 3y ago
    A lot of states are looking into large battery facilities specifically for frequency regulations.
    - drewchew 3y ago
      I kind of wonder why there has been so much push for consumer solar / battery over neighborhood solar / battery projects. At least in Texas, there is so much empty land, it seems like it would be more effective to 'imminent domain' some land or leverage existing right-of-ways for solar array + battery storage, rather than putting the burden on individual homeowners to purchase what is effectively community infrastructure (if we were allowed to sell power back to the grid).
      - boringg 3y ago
        I was talking utility level storage. My lens is that utility/industrial level solar + storage is where most of the action is. The retail stuff is good for construction and local jobs and the feel good homeowner play.
  - bluGill 3y ago
    Not yet anyway. While batteries are interesting, they do start on fire once in a while. We think with correct engineering that risk can be mitigated, but we shouldn't roll things out too fast just in case it really can't.
- bluGill 3y ago
  > it’d actually make more sense for power companies to buy people homes in other states No, because of scale. A large factory is one entity to deal with. Moving just one out of state is possible, but meaningless as even though houses are significant overall you need to deal with many houses before an actual difference is made, while if you can deal with a factory you can make a large difference for the same amount of effort. A factory/hospital is also easier because they probably have a backup plan. if there is any possibility that the power will go out they are likely to have made backup plans. You are overall cheaper than their backup plans, but you can probably make them a deal where they run their backup plan instead of connecting to you. Since they already have the generator it isn't a problem for them to use their generator on your busy days, and so a small discount makes it easy to work with the factory than a home owner who is probably thinking about friends and family they are moving away from. The power company has a list of who these deals are with and the priority order. I know of one factory with a coal boiler from the 1800s, and a generator from then 1920s - the whole is very inefficient and takes a full day to start up, but the power company makes it worth while to keep everything operational because every 5 years they can power it on and supply the whole town (at 5x the normal cost of power from the plants they run all the time). Meanwhile there is a store near my parents that is running their generator every hot day - a modern diesel generator when sized properly is not a lot more expensive than grid power so the store doesn't need a big incentive to use it instead of grid power. Of course all of the above is for exceptions. Where I live now we have built far more wind than needed most of the time, and as a result 80% of our power is renewable. There are very few days when backups are even needed.
- pjc50 3y ago
  You could certainly make an argument that zoning needs to be "power neutral": can't zone any houses or businesses without zoning an equivalent power plant. Very SimCity.
Retric 3y ago
You achieve similar results by simply charging such customers current market rates. Nobody is going to be mining Bitcoin while paying 2.50$/kWh. That’s the objection, it’s simply a waste of money.
- kentonv 3y ago
  It's so weird because I thought the whole point of ERCOT was to be a market and use market forces to solve everything. So why are they paying bitcoin miners to turn off, rather than just charging them market rates at all times and letting them decide for themselves? I feel like I'm missing something here.
  - edmundsauto 3y ago
    The gap between actual unfettered market forces and what gets implemented in American capitalism is where the grift happens. IE, ostensibly set up a free market to satisfy the ideologues but make sure there are carveout deals so cronyism has room to hand out favors.
    - readthenotes1 3y ago
      Don't forget the guy in 2021 who told investors he will keep the prices as high as possible for as long as possible during that winter storm.
  - jaccarmac 3y ago
    The last couple years of evidence suggests that keeping the grid up requires a certain amount of central planning. On one hand, the frequency must remain relatively stable, globally. On the other, consumers don't want to deal with every fluctuation of the price (as they found out when they were exposed to the spike prices during spring '21). On principle, Texas is going to make sure that the energy sector is taken care of financially, so we end up in the situation we're in: Advertise the grid as market-purely as you can, engage in just enough planning to keep it up and the money flowing.
  - pjc50 3y ago

by lukev 3y ago

no_wizard 3y ago

I have a friend who works in the energy industry specifically targeting power grid management. It is far easier for power companies to manage power loss for things with consistent power usage (low variance) than high variance / inconsistent power loads. Businesses tend to be very consistent, even if their power draw is high, like manufacturing or hospitals etc. Residential power tends to be more variant and harder to fine tune for because it can spike quite suddenly in unexpected ways and tends to add more base load over time. Therefore, it’d actually make more sense for power companies to buy people homes in other states if lowering base load is a concern, since residential is where all the major issues are for load balancing, no?

drewchew 3y ago
Would it help if the state were to provide tax incentives for in home battery backups?
- boringg 3y ago
  A lot of states are looking into large battery facilities specifically for frequency regulations.
  - drewchew 3y ago
    I kind of wonder why there has been so much push for consumer solar / battery over neighborhood solar / battery projects. At least in Texas, there is so much empty land, it seems like it would be more effective to 'imminent domain' some land or leverage existing right-of-ways for solar array + battery storage, rather than putting the burden on individual homeowners to purchase what is effectively community infrastructure (if we were allowed to sell power back to the grid).
    - boringg 3y ago
      I was talking utility level storage. My lens is that utility/industrial level solar + storage is where most of the action is. The retail stuff is good for construction and local jobs and the feel good homeowner play.
- bluGill 3y ago
  Not yet anyway. While batteries are interesting, they do start on fire once in a while. We think with correct engineering that risk can be mitigated, but we shouldn't roll things out too fast just in case it really can't.
bluGill 3y ago
> it’d actually make more sense for power companies to buy people homes in other states No, because of scale. A large factory is one entity to deal with. Moving just one out of state is possible, but meaningless as even though houses are significant overall you need to deal with many houses before an actual difference is made, while if you can deal with a factory you can make a large difference for the same amount of effort. A factory/hospital is also easier because they probably have a backup plan. if there is any possibility that the power will go out they are likely to have made backup plans. You are overall cheaper than their backup plans, but you can probably make them a deal where they run their backup plan instead of connecting to you. Since they already have the generator it isn't a problem for them to use their generator on your busy days, and so a small discount makes it easy to work with the factory than a home owner who is probably thinking about friends and family they are moving away from. The power company has a list of who these deals are with and the priority order. I know of one factory with a coal boiler from the 1800s, and a generator from then 1920s - the whole is very inefficient and takes a full day to start up, but the power company makes it worth while to keep everything operational because every 5 years they can power it on and supply the whole town (at 5x the normal cost of power from the plants they run all the time). Meanwhile there is a store near my parents that is running their generator every hot day - a modern diesel generator when sized properly is not a lot more expensive than grid power so the store doesn't need a big incentive to use it instead of grid power. Of course all of the above is for exceptions. Where I live now we have built far more wind than needed most of the time, and as a result 80% of our power is renewable. There are very few days when backups are even needed.
pjc50 3y ago
You could certainly make an argument that zoning needs to be "power neutral": can't zone any houses or businesses without zoning an equivalent power plant. Very SimCity.

Retric 3y ago

You achieve similar results by simply charging such customers current market rates. Nobody is going to be mining Bitcoin while paying 2.50$/kWh. That’s the objection, it’s simply a waste of money.

kentonv 3y ago
It's so weird because I thought the whole point of ERCOT was to be a market and use market forces to solve everything. So why are they paying bitcoin miners to turn off, rather than just charging them market rates at all times and letting them decide for themselves? I feel like I'm missing something here.
- edmundsauto 3y ago
  The gap between actual unfettered market forces and what gets implemented in American capitalism is where the grift happens. IE, ostensibly set up a free market to satisfy the ideologues but make sure there are carveout deals so cronyism has room to hand out favors.
  - readthenotes1 3y ago
    Don't forget the guy in 2021 who told investors he will keep the prices as high as possible for as long as possible during that winter storm.
- jaccarmac 3y ago
  The last couple years of evidence suggests that keeping the grid up requires a certain amount of central planning. On one hand, the frequency must remain relatively stable, globally. On the other, consumers don't want to deal with every fluctuation of the price (as they found out when they were exposed to the spike prices during spring '21). On principle, Texas is going to make sure that the energy sector is taken care of financially, so we end up in the situation we're in: Advertise the grid as market-purely as you can, engage in just enough planning to keep it up and the money flowing.
- pjc50 3y ago