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I want to understand your reasoning a bit better. Care to expand please? The way I see 2022 was a crisis of energy PRICES, had the markets not been there it mi

I want to understand your reasoning a bit better. Care to expand please? The way I see 2022 was a crisis of energy PRICES, had the markets not been there it might have been a crisis of energy AVAILABILITY. Strictly worse.

pyrale 3y ago
Interconnexions existed before the market, and their development is not purely related to the market. A significant part of grid cooperation through ENTSO-E is about stability, not increased market benefits. If you will, this is like saying you need an exchange for trade. Well, no, OTC markets exist.
- jnsaff2 3y ago
  Interconnections sure, but the crisis of 2022 was mostly about cost of gas and other fossil fuels. The markets made sure that the plants got their costs covered and stayed online. One can argue whether the last-price-wins is the best market structure but how would you have forced plants to generate at a loss without nationalizing them?
  - pyrale 3y ago
    > The markets made sure that the plants got their costs covered and stayed online. I don't really understand your point here. In an otc trade, costs are also covered, no one works for free. That being said, my original point was not even about that. It was more about lines in the article that strongly hint that, in the author's opinion, the current issue is politicians not doing enough to force their citizen to swallow the pill. Relevant paragraph: > Further market integration requires substantial political investment. Governments will need to deal with significant distributional effects within and between countries. Experience has shown that domestic political constraints in this respect are often numerous and difficult to overcome.
    - jnsaff2 3y ago
      How is OTC better than markets? PPA's still exist alongside markets without issues.
      - pyrale 3y ago
        I'm not saying one is better than the other. I'm saying power availability doesn't require a market.
        jnsaff2 3y ago
        What are you trying to claim then? That with completely non-public OTC deals prices would be better somehow?
        pyrale 3y ago
        > The way I see 2022 was a crisis of energy PRICES, had the markets not been there it might have been a crisis of energy AVAILABILITY. I'm simply saying that markets have no first-order effect on availability. As for prices, it's another matter.
        jnsaff2 3y ago
        Unavailability of generation due to it being uneconomical to generate has a very direct effect on availability. The electricity market price is downstream dependent on gas market price among others. You want to also remove gas markets then? Anyway, I would gladly hear what would have 2022 looked like had there not been electricity markets.
        pyrale 3y ago
        > Unavailability of generation due to it being uneconomical to generate has a very direct effect on availability. Production can't be ramped up significantly in the span of a crisis. In that sense, a different trading scheme wouldn't have made a difference in terms of resource availability during the crisis. > The electricity market price is downstream dependent on gas market price among others. You want to also remove gas markets then? Not sure what connection you make between that and my point. > Anyway, I would gladly hear what would have 2022 looked like had there not been electricity markets. From an availability PoV, exactly the same. Markets are not responsible for making sure that production is available, or actually used ; that's the role of TSOs.
  - p4bl0 3y ago
    > without nationalizing them Why would this option be ignored? We need some production sites to be operated at a loss, because they have to be maintained the whole year while they may be of use only a few weeks or days per year — but those times we cannot do without them. No market will ever be able to make that happen, those have ti be publicly owned. Why, oh why on earth would be decide that the benefits should be privatized while the losses have to stay public? Especially when the result of privatization and market policy is that electricity is more expensive for everyone in the end.
    - jnsaff2 3y ago
      Subsidies are being paid for dispatchable power generation in the name of national interests and grid stability. This is already been done. Full nationalization would remove incentives for build out of new generation and renewables. > Especially when the result of privatization and market policy is that electricity is more expensive for everyone in the end. Do you have any references to point to that would claim that a nationalized power system would be cheaper than market? Seems like a very bold claim.
      - p4bl0 3y ago
        It's really not a bold claim. It may seems like so if you chose to believe in the idealized market model but that does not exist in real life. As for the references, I linked to them (it's in French however) in another comment here. Also, all of the progress and innovations and building of new generations and renewables and everything until recently has been done without a market, at least in France, which probably has one of the best electricity system in the world.
    - ExoticPearTree 3y ago
      >> without nationalizing them >Why would this option be ignored? Because nothing nationalized works.
      - p4bl0 3y ago
        This is a biased and plainly wrong claim that has absolutely no substance.

pyrale 3y ago

Interconnexions existed before the market, and their development is not purely related to the market. A significant part of grid cooperation through ENTSO-E is about stability, not increased market benefits. If you will, this is like saying you need an exchange for trade. Well, no, OTC markets exist.

jnsaff2 3y ago
Interconnections sure, but the crisis of 2022 was mostly about cost of gas and other fossil fuels. The markets made sure that the plants got their costs covered and stayed online. One can argue whether the last-price-wins is the best market structure but how would you have forced plants to generate at a loss without nationalizing them?
- pyrale 3y ago
  > The markets made sure that the plants got their costs covered and stayed online. I don't really understand your point here. In an otc trade, costs are also covered, no one works for free. That being said, my original point was not even about that. It was more about lines in the article that strongly hint that, in the author's opinion, the current issue is politicians not doing enough to force their citizen to swallow the pill. Relevant paragraph: > Further market integration requires substantial political investment. Governments will need to deal with significant distributional effects within and between countries. Experience has shown that domestic political constraints in this respect are often numerous and difficult to overcome.
  - jnsaff2 3y ago
    How is OTC better than markets? PPA's still exist alongside markets without issues.
    - pyrale 3y ago
      I'm not saying one is better than the other. I'm saying power availability doesn't require a market.
      - jnsaff2 3y ago
        What are you trying to claim then? That with completely non-public OTC deals prices would be better somehow?
        pyrale 3y ago
        > The way I see 2022 was a crisis of energy PRICES, had the markets not been there it might have been a crisis of energy AVAILABILITY. I'm simply saying that markets have no first-order effect on availability. As for prices, it's another matter.
        jnsaff2 3y ago
        Unavailability of generation due to it being uneconomical to generate has a very direct effect on availability. The electricity market price is downstream dependent on gas market price among others. You want to also remove gas markets then? Anyway, I would gladly hear what would have 2022 looked like had there not been electricity markets.
        pyrale 3y ago
        > Unavailability of generation due to it being uneconomical to generate has a very direct effect on availability. Production can't be ramped up significantly in the span of a crisis. In that sense, a different trading scheme wouldn't have made a difference in terms of resource availability during the crisis. > The electricity market price is downstream dependent on gas market price among others. You want to also remove gas markets then? Not sure what connection you make between that and my point. > Anyway, I would gladly hear what would have 2022 looked like had there not been electricity markets. From an availability PoV, exactly the same. Markets are not responsible for making sure that production is available, or actually used ; that's the role of TSOs.
- p4bl0 3y ago
  > without nationalizing them Why would this option be ignored? We need some production sites to be operated at a loss, because they have to be maintained the whole year while they may be of use only a few weeks or days per year — but those times we cannot do without them. No market will ever be able to make that happen, those have ti be publicly owned. Why, oh why on earth would be decide that the benefits should be privatized while the losses have to stay public? Especially when the result of privatization and market policy is that electricity is more expensive for everyone in the end.
  - jnsaff2 3y ago
    Subsidies are being paid for dispatchable power generation in the name of national interests and grid stability. This is already been done. Full nationalization would remove incentives for build out of new generation and renewables. > Especially when the result of privatization and market policy is that electricity is more expensive for everyone in the end. Do you have any references to point to that would claim that a nationalized power system would be cheaper than market? Seems like a very bold claim.
    - p4bl0 3y ago
      It's really not a bold claim. It may seems like so if you chose to believe in the idealized market model but that does not exist in real life. As for the references, I linked to them (it's in French however) in another comment here. Also, all of the progress and innovations and building of new generations and renewables and everything until recently has been done without a market, at least in France, which probably has one of the best electricity system in the world.
  - ExoticPearTree 3y ago
    >> without nationalizing them >Why would this option be ignored? Because nothing nationalized works.
    - p4bl0 3y ago
      This is a biased and plainly wrong claim that has absolutely no substance.