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> I don't understand this analogy. Well.. Texas doesn't just pay this miner, they pay any enterprise which "strains the grid." It's a market for perverse in
by akira2501 3y ago
> I don't understand this analogy.
Well.. Texas doesn't just pay this miner, they pay any enterprise which "strains the grid." It's a market for perverse incentives the way the Cobra Effect is.
> The miner is being compensated for lost production in exchange for grid stability.
The miner is arbitraging the tax payer against their ability to construct new plants, which is how this money could presumably be better spent.
> The only way your analogy works is if you consider industry bad (playing loud music).
His analogy is flawed. There's an absolute limit to sound pressure in this universe. There's probably not an absolute limit to human greed in this universe. So, yes, unconstrained processes without any natural (e.g. non-external) feedback are probably bad.
- SamReidHughes 3y agoAn enterprise that "strains the grid" still has to pay for that electricity, so it's not some perverse incentive at all.
- deleted 3y ago[deleted]
- akira2501 3y agoThere is no "strain based pricing" in effect here, though, there is "strain based rationing through buyouts." Since those who can receive the buyouts can also create the strain, it does very well seem to be that this is exactly a perverse incentive. If, however, the number of "strain incidents per unit of time" were factored into pricing accordingly, I'm sure these enterprises would change their strategy.