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If there is no buyer for excess solar/wind electricity, then it must curtail and earn less income. Less income means it takes longer to pay off initial capital

If there is no buyer for excess solar/wind electricity, then it must curtail and earn less income. Less income means it takes longer to pay off initial capital costs and generate return. Slower investment return from solar and wind deployments means expansion of them will take longer. If wind and solar takes longer to roll out at full scale for financial reasons, then our goals towards fossil fuel reductions takes longer. Therefore, if you can find a buyer who will suck up any excess solar and wind and pay them, we eliminate fossil fuels quicker.

jcranmer 3y ago
> If there is no buyer for excess solar/wind electricity, then it must curtail and earn less income. Solar and wind have the lowest marginal costs of production, which means they'll win out on the wholesale power markets. Furthermore, Texas is a state with increasing population growth and increasing energy needs (hotter planet means more A/C, after all), and has regularly been setting all-time highs on daily energy consumption. So there'll always be a buyer for the excess electricity.
- friend_and_foe 3y ago
  You should read about base load energy production to understand what's going on here.
  - jcranmer 3y ago
    Look, this is Texas. It's not about base load energy production. This is a system that--several times this past year--is running at demand around 100% of supply capacity. That shouldn't happen; it's just bad industrial engineering. The cryptocurrency mines aren't adding base load here. It's adding more load on a system that's already taxed to its limits, and justifying it as a good thing because "oh, we can get paid to turn it off if there's too much demand." People should be yelling at ERCOT for being an incompetent regulator that's letting the grid get away with too little supply (and that's what this article is sort of doing, except its anger is directed towards cryptocurrency mines, not ERCOT, so it's somewhat misplaced). And, for what it's worth, cryptocurrency is kind of bad at base load. It's not using any reactive power.
    - friend_and_foe 3y ago
      Reactive power is by definition unused. A constant stream of demand that does not fluctuate and can be turned off at a moment's notice without any dire consequences, that's bad at base load? How so? These heat waves and extreme cold events are purportedly unprecedented, due to climate change. Should we be surprised when electricity infrastructure designed for normal times gets strained? I've been in countries with rolling power outages, I wouldn't call the Texas grid badly engineered. Considering it's a standalone grid I'd say it's got to be fantastically engineered to have the uptime that it has, I don't think the UK even has such a resilient system.
      - jcranmer 3y ago
        > I don't think the UK even has such a resilient system. Tell that to someone from the UK, and they're likely to laugh in your face. The UK has never faced rolling power outages; Texas faced that just two years ago (although ERCOT appears to have had some issues with the "rolling" part). Furthermore, I don't think the UK has ever had to go voluntary load-shedding measures; Texas had to do that several times this past month, and last summer, etc. It's hard to say that the extreme cold event was uprecedented when the exact same thing happened in Texas but a decade prior, complete with learnings that would have prevented the breakdown of the grid (i.e., rolling blackouts) had they been implemented. And the extreme heat wave has been impacting, well, more or less the entire world, and most of the power systems haven't even had to suggest that customers use less power. This is stuff that is eminently predictable, and in most of the world, electricity capacity is planned under the basis of extreme demand scenarios, not normal demand scenarios. If Texas's grid is designed merely for normal demand, then that is a surprise that should have Texans up in arms about the incompetence of their electricity regulator.
        friend_and_foe 3y ago
        https://www.theguardian.com/business/2022/oct/06/how-would-three-hour-power-cuts-work-great-britain https://www.theguardian.com/business/2022/oct/06/how-would-t... Well when I say regular or normal, I don't mean an 80° sunny day, I mean one standard deviation from the mean. They take extremes into account, you can't take unprecedented extremes into account, by definition. It gets hot, and it gets cold, and the grid is fine. If the entire state of Nevada had a giant ice storm that covered nearly the whole state, I highly doubt that their grid integrated with the rest of their region would be able to handle it. Shit, California can't even do it on a good day. Have you been to other parts of the world? Outside of Europe and the US, and a few recently well developed countries in southeast Asia, rolling blackouts are par for the course. I've spent 6 straight days without electricity before in a developing country, without any extreme weather event. Grids are hard to manage.
FactKnower69 3y ago
remember, everyone: markets are the most efficient way to allocate resources :)
Aloha 3y ago
It also pushes the market rate below the marginal cost for thermal generation.

jcranmer 3y ago

> If there is no buyer for excess solar/wind electricity, then it must curtail and earn less income. Solar and wind have the lowest marginal costs of production, which means they'll win out on the wholesale power markets. Furthermore, Texas is a state with increasing population growth and increasing energy needs (hotter planet means more A/C, after all), and has regularly been setting all-time highs on daily energy consumption. So there'll always be a buyer for the excess electricity.

friend_and_foe 3y ago
You should read about base load energy production to understand what's going on here.
- jcranmer 3y ago
  Look, this is Texas. It's not about base load energy production. This is a system that--several times this past year--is running at demand around 100% of supply capacity. That shouldn't happen; it's just bad industrial engineering. The cryptocurrency mines aren't adding base load here. It's adding more load on a system that's already taxed to its limits, and justifying it as a good thing because "oh, we can get paid to turn it off if there's too much demand." People should be yelling at ERCOT for being an incompetent regulator that's letting the grid get away with too little supply (and that's what this article is sort of doing, except its anger is directed towards cryptocurrency mines, not ERCOT, so it's somewhat misplaced). And, for what it's worth, cryptocurrency is kind of bad at base load. It's not using any reactive power.
  - friend_and_foe 3y ago
    Reactive power is by definition unused. A constant stream of demand that does not fluctuate and can be turned off at a moment's notice without any dire consequences, that's bad at base load? How so? These heat waves and extreme cold events are purportedly unprecedented, due to climate change. Should we be surprised when electricity infrastructure designed for normal times gets strained? I've been in countries with rolling power outages, I wouldn't call the Texas grid badly engineered. Considering it's a standalone grid I'd say it's got to be fantastically engineered to have the uptime that it has, I don't think the UK even has such a resilient system.
    - jcranmer 3y ago
      > I don't think the UK even has such a resilient system. Tell that to someone from the UK, and they're likely to laugh in your face. The UK has never faced rolling power outages; Texas faced that just two years ago (although ERCOT appears to have had some issues with the "rolling" part). Furthermore, I don't think the UK has ever had to go voluntary load-shedding measures; Texas had to do that several times this past month, and last summer, etc. It's hard to say that the extreme cold event was uprecedented when the exact same thing happened in Texas but a decade prior, complete with learnings that would have prevented the breakdown of the grid (i.e., rolling blackouts) had they been implemented. And the extreme heat wave has been impacting, well, more or less the entire world, and most of the power systems haven't even had to suggest that customers use less power. This is stuff that is eminently predictable, and in most of the world, electricity capacity is planned under the basis of extreme demand scenarios, not normal demand scenarios. If Texas's grid is designed merely for normal demand, then that is a surprise that should have Texans up in arms about the incompetence of their electricity regulator.
      - friend_and_foe 3y ago
        https://www.theguardian.com/business/2022/oct/06/how-would-three-hour-power-cuts-work-great-britain https://www.theguardian.com/business/2022/oct/06/how-would-t... Well when I say regular or normal, I don't mean an 80° sunny day, I mean one standard deviation from the mean. They take extremes into account, you can't take unprecedented extremes into account, by definition. It gets hot, and it gets cold, and the grid is fine. If the entire state of Nevada had a giant ice storm that covered nearly the whole state, I highly doubt that their grid integrated with the rest of their region would be able to handle it. Shit, California can't even do it on a good day. Have you been to other parts of the world? Outside of Europe and the US, and a few recently well developed countries in southeast Asia, rolling blackouts are par for the course. I've spent 6 straight days without electricity before in a developing country, without any extreme weather event. Grids are hard to manage.

FactKnower69 3y ago

remember, everyone: markets are the most efficient way to allocate resources :)

Aloha 3y ago

It also pushes the market rate below the marginal cost for thermal generation.