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This will take expenditure that utility shareholders won't tolerate. Most of the electrical grid in the US gets used until it just can't work safely anymore, an

This will take expenditure that utility shareholders won't tolerate. Most of the electrical grid in the US gets used until it just can't work safely anymore, and the determinant of whether it can work safely is whether it has already caused a very hazardous condition that simply can't be ignored by the public-at-large. They're not going to suddenly say, "Oh, sure, we can make a decent gain in efficiency by updating the grid, let's build those projects out."

doctorhandshake 3y ago
My understanding is that utilities keep a percentage of the cost of capital improvements they make. This is because the utilities’ original arrangement from way back when was designed to incentivize the rollout of electricity as fast as possible. To that extent their incentive is actually to undertake the largest and most expensive development projects possible. The issue with distribution infrastructure as I understand it is not a lack of will or incentives on the utilities side but simply the difficulty in acquiring right of way and permitting.
- lenerdenator 3y ago
  Most of the stuff that could be replaced exists in an easement. I don't have to agree to let my local utility upgrade my infrastructure. Also, any time something "just works" and a business can charge someone to use it, they'll do that instead of actively working to improve the product, particularly if that product is a commodity and they have a monopoly on it. They've also leveraged regulatory capture to make sure that the public utility boards don't put a lot of pressure on them to make needed changes.
  - doctorhandshake 3y ago
    I think the type of improvement you’re talking about falls under the category of ‘reconductoring’, or capacity improvements to existing deployments. That can help, but interconnection and new distribution is, I think, a much bigger piece of what’s needed, and for that, we need to get all over the place.
itishappy 3y ago
The article is about exactly that: > Normally, such a sudden loss would spell disaster for a small, islanded grid. But the Kauai grid has a feature that many larger grids lack: a technology called grid-forming inverters. An inverter converts direct-current electricity to grid-compatible alternating current. The island’s grid-forming inverters are connected to those battery systems, and they are a special type—in fact, they had been installed with just such a contingency in mind. > At the time of this writing, at least eight major grid-forming projects are either under construction or in operation in Australia, along with others in Asia, Europe, North America, and the Middle East. Utilities are low margin businesses. Why wouldn't they jump at any opportunity to improve efficiencies?
- spywaregorilla 3y ago
  It depends on the expected ROI of the investment Utilities don't face competition so the efficiency gains have to speak for themselves. They can't gain marketshare.
  - 0xbadcafebee 3y ago
    The parent companies that own the utilities can (and do) gain marketshare, and/or profits. They're diversified so they can get profit from other places. There's lots of tricks to use to create profits; get government grants, try to replace old expensive inefficient infrastructure with newer more efficient cheaper stuff, create more infrastructure to service the growing power needs of new power-hungry industries, supply more power to new or growing cities, build out electric vehicle charging, try out new technologies like hydrogen, etc. They are quite expansive operations with a lot of fingers in a lot of pies.
    - spywaregorilla 3y ago
      None of that is particularly relevant to the claim that a small efficiency improvement is automatically worth the capital cost when there's no competitors.
vegetablepotpie 3y ago
The article says we can build grid forming inverters, which can solve the reliability issues of highly renewable grids, and used Hawaii as an example of how to do this. These inverters are expensive. As a utility I can finance grid upgrades through corporate bonds or, or as you said, with investor money. Bonds need to be paid back in a defined time period, investors expect a ~10%/yr ROE, or else they do flee. As a utility, investments I make are financed through ratepayer funds. The problem has shifted from engineering, to financial, to political. I need to ask my states utility commission for a raise in rates. This hits on affordability issues, poverty etc. Who pays for it? Who benefits? This is determined by state elections.
akamaka 3y ago
> They're not going to suddenly say, "Oh, sure, we can make a decent gain in efficiency by updating the grid, let's build those projects out." That’s actually happening, though. One quarter of new capacity this year is battery systems: https://www.whitehouse.gov/cea/written-materials/2024/04/11/the-next-phase-of-electricity-decarbonization-planned-power-capacity-is-nearly-all-zero-carbon/ https://www.whitehouse.gov/cea/written-materials/2024/04/11/...

doctorhandshake 3y ago

My understanding is that utilities keep a percentage of the cost of capital improvements they make. This is because the utilities’ original arrangement from way back when was designed to incentivize the rollout of electricity as fast as possible. To that extent their incentive is actually to undertake the largest and most expensive development projects possible. The issue with distribution infrastructure as I understand it is not a lack of will or incentives on the utilities side but simply the difficulty in acquiring right of way and permitting.

lenerdenator 3y ago
Most of the stuff that could be replaced exists in an easement. I don't have to agree to let my local utility upgrade my infrastructure. Also, any time something "just works" and a business can charge someone to use it, they'll do that instead of actively working to improve the product, particularly if that product is a commodity and they have a monopoly on it. They've also leveraged regulatory capture to make sure that the public utility boards don't put a lot of pressure on them to make needed changes.
- doctorhandshake 3y ago
  I think the type of improvement you’re talking about falls under the category of ‘reconductoring’, or capacity improvements to existing deployments. That can help, but interconnection and new distribution is, I think, a much bigger piece of what’s needed, and for that, we need to get all over the place.

itishappy 3y ago

The article is about exactly that: > Normally, such a sudden loss would spell disaster for a small, islanded grid. But the Kauai grid has a feature that many larger grids lack: a technology called grid-forming inverters. An inverter converts direct-current electricity to grid-compatible alternating current. The island’s grid-forming inverters are connected to those battery systems, and they are a special type—in fact, they had been installed with just such a contingency in mind. > At the time of this writing, at least eight major grid-forming projects are either under construction or in operation in Australia, along with others in Asia, Europe, North America, and the Middle East. Utilities are low margin businesses. Why wouldn't they jump at any opportunity to improve efficiencies?

spywaregorilla 3y ago
It depends on the expected ROI of the investment Utilities don't face competition so the efficiency gains have to speak for themselves. They can't gain marketshare.
- 0xbadcafebee 3y ago
  The parent companies that own the utilities can (and do) gain marketshare, and/or profits. They're diversified so they can get profit from other places. There's lots of tricks to use to create profits; get government grants, try to replace old expensive inefficient infrastructure with newer more efficient cheaper stuff, create more infrastructure to service the growing power needs of new power-hungry industries, supply more power to new or growing cities, build out electric vehicle charging, try out new technologies like hydrogen, etc. They are quite expansive operations with a lot of fingers in a lot of pies.
  - spywaregorilla 3y ago
    None of that is particularly relevant to the claim that a small efficiency improvement is automatically worth the capital cost when there's no competitors.

vegetablepotpie 3y ago

The article says we can build grid forming inverters, which can solve the reliability issues of highly renewable grids, and used Hawaii as an example of how to do this. These inverters are expensive. As a utility I can finance grid upgrades through corporate bonds or, or as you said, with investor money. Bonds need to be paid back in a defined time period, investors expect a ~10%/yr ROE, or else they do flee. As a utility, investments I make are financed through ratepayer funds. The problem has shifted from engineering, to financial, to political. I need to ask my states utility commission for a raise in rates. This hits on affordability issues, poverty etc. Who pays for it? Who benefits? This is determined by state elections.

akamaka 3y ago

> They're not going to suddenly say, "Oh, sure, we can make a decent gain in efficiency by updating the grid, let's build those projects out." That’s actually happening, though. One quarter of new capacity this year is battery systems: https://www.whitehouse.gov/cea/written-materials/2024/04/11/the-next-phase-of-electricity-decarbonization-planned-power-capacity-is-nearly-all-zero-carbon/ https://www.whitehouse.gov/cea/written-materials/2024/04/11/...