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This couldn't be farther from the truth. The electricity market is a disaster that drives the prices artificially high. There is no more correlation between pro

by p4bl0 3y ago

This couldn't be farther from the truth. The electricity market is a disaster that drives the prices artificially high. There is no more correlation between production price and consumption price. A centralized planning would greatly benefit everyone here (well except for shareholders of so-called "alternative suppliers" companies). If you speak French, this series of video on the Heu?reka YouTube channel explains all this very well, both from the technical side and from the financial side. The videos are rather long because they go in depth on the subject: - Comprendre le marché de l'électricité (Understanding the eletricity market) : https://www.youtube.com/watch?v=ienoSbONyhw https://www.youtube.com/watch?v=ienoSbONyhw - Les super-profits des fournisseurs alternatifs (The super-profits of alternative suppliers) : https://www.youtube.com/watch?v=P3to46JLDu8 https://www.youtube.com/watch?v=P3to46JLDu8 - Comprendre la bourse de l'électricité : le maché SPOT (Understanding the electricity exchange: the SPOT market) : https://www.youtube.com/watch?v=rZCKv0C6Dqs https://www.youtube.com/watch?v=rZCKv0C6Dqs - Pourquoi prix de l'élecricité = coût de la centrale la plus chère ? Comprendre le modèle (Why the price of electricity = the cost of the most expensive central? Understanding the underlying model) : https://www.youtube.com/watch?v=Ep3biZAtitE https://www.youtube.com/watch?v=Ep3biZAtitE

NotGMan 3y ago
>> There is no more correlation between production price and consumption price. This, it's basicaly the "financialization of electricity". When I looked at the cost of electricity production vs the buying price for it in my country there was a total disconnect. The power plants don't feed my country anymore: they feed the market, which then scams the buyers.
- piva00 3y ago
  Exactly, when the Russian invasion of Ukraine started in 2022 I was hit with absurd prices for electricity, even though I live in Sweden where we don't depend at all on gas for electricity generation (it's all nuclear/hydro/wind). I still had to pay absurd prices because of the scam of financial markets taking over electricity in the EU, why the fuck do I have to pay the highest spot price of a whole continent when none of that energy is reaching me? Natural monopolies should be in the hands of the people through the State, allowing grifters to append themselves to extract rent from those natural monopolies is just ridiculous...
badpun 3y ago
> There is no more correlation between production price and consumption price. That is because, for certain modes of production (renewables, nuclear), most of the cost is paid up-front during construction, and the cost of production is minimal. The plants (nuclear, solar, wind) are effectively financial devices, where someone takes a huge loan or otherwise gets capital at yearly interest, and slowly pays it off.
sam_lowry_ 3y ago
> except for shareholders of so-called > "alternative suppliers" companies If you check Bruegel membership, you'll see mostly financial institutions and consultancies. So it's not even alternative suppliers who benefit.

by p4bl0 3y ago

NotGMan 3y ago

>> There is no more correlation between production price and consumption price. This, it's basicaly the "financialization of electricity". When I looked at the cost of electricity production vs the buying price for it in my country there was a total disconnect. The power plants don't feed my country anymore: they feed the market, which then scams the buyers.

piva00 3y ago
Exactly, when the Russian invasion of Ukraine started in 2022 I was hit with absurd prices for electricity, even though I live in Sweden where we don't depend at all on gas for electricity generation (it's all nuclear/hydro/wind). I still had to pay absurd prices because of the scam of financial markets taking over electricity in the EU, why the fuck do I have to pay the highest spot price of a whole continent when none of that energy is reaching me? Natural monopolies should be in the hands of the people through the State, allowing grifters to append themselves to extract rent from those natural monopolies is just ridiculous...

badpun 3y ago

> There is no more correlation between production price and consumption price. That is because, for certain modes of production (renewables, nuclear), most of the cost is paid up-front during construction, and the cost of production is minimal. The plants (nuclear, solar, wind) are effectively financial devices, where someone takes a huge loan or otherwise gets capital at yearly interest, and slowly pays it off.

sam_lowry_ 3y ago

> except for shareholders of so-called > "alternative suppliers" companies If you check Bruegel membership, you'll see mostly financial institutions and consultancies. So it's not even alternative suppliers who benefit.