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> When there’s enough surplus energy supply from renewables, prices can even go negative. That's great news for consumers - who get paid to use energy - but it'

by roenxi 2y ago

> When there’s enough surplus energy supply from renewables, prices can even go negative. That's great news for consumers - who get paid to use energy - but it's bad news for renewable generators. That isn't correct, it is just bad news for everyone. Sure if there was a sustainable deal that offered negative prices that'd be good, but in this case it just means the prices when positive will have to go up to cover the overall profits of the energy producers. Negative prices represent waste and it is quite unusual for waste to be good for consumers. Although this is a minor point. The solar revolution is pretty exciting.

AndrewDucker 2y ago
Negative pricing will lead to people building storage which can make use of it to charge, and then sell back when prices are positive again. It's an excellent signal of opportunity.
snapplebobapple 2y ago
No it doesnt mean either of those things. It means you built too much solar and made the grid more unstable given the physics constraints on short term supply and demand. Its not waste, it is not good.
thelastgallon 2y ago
There is a sustainable deal that can work with negative prices. Charge EVs when price is negative and pay the carowners. For this, car owners have to be always plugged in (except the 20m - 1hour) that they drive. When demand peaks, the cars can supply power back to the grid and make even more money! Households can put solar panels, provide the entire energy infrastructure: production and storage. Car batteries are ~6 times larger than powerwalls and powerwalls can make money supplying power back to the grid: https://electrek.co/2023/07/05/tesla-electric-customers-report-making-150-day/ https://electrek.co/2023/07/05/tesla-electric-customers-repo... We don't need peak power infrastructure (natural gas) which runs only a few hours per day. All of it can be replaced by EVs.
ikekkdcjkfke 2y ago
Let the market forces deal with it?
- roenxi 2y ago
  Yeah. The way market forces will deal with it is some energy sink will be figured out for the mid-day peak, and prices will stop going negative. But when that happens the average price of power generated from solar panels will probably drop (because less of the power generated by a panel is wasted, so the capital cost/power generated ratio improves) and consumers will be better off. I expect. These market effects are complicated. It is the opposite of what happened in, say, Germany. They started seeing negative power prices on the wholesale market then they ended up with average electricity prices that were among the most expensive in the world.
  - imtringued 2y ago
    The EEG subsidy program is a joke. The government guarantees a minimum price on your feed-in tariff. This means if the price is negative 8 cents and the feed-in tariff is positive 8 cents (numbers are for illustration purposes), the government pays 16 cents. It's no different from what the central bank does with its zero lower bound guarantee on interest rates. The market rate on capital is negative? Gotta subsidize private capital holders with infinite QE. The guaranteed minimum price floor is zero, the interest rate is say -3%, the central bank essentially pays 3% interest to keep the house of cards from collapsing. Since negative interest rates cannot be represented in the current system, we have inflation as the band aid. The thing is, negative prices or interest rates aren't evil or bad on their own, they become dysfunctional the moment there is a guaranteed price floor. It's no different than a price ceiling. The only difference is shortage vs oversupply.
    - tcfhgj 2y ago
      First of all, this isn't true. In case the prices drop negative, the solar plant will be disconnected from the grid remotely and the solar plant owner will get what he had gotten if the solar plant had not been disconnected from the grid. Second, subsidizing once expensive but mostly cleanenergy production technology, allowed renewable energy to thrive to the number 1 energy source worldwide, theoretically allowing to ditch fossil energy production completely by 2050 and stay within low risk climate warming - without significant degrowth, which otherwise would have been required for a certainty. So no, EEG isn't a joke, but a huge win for humanity.
mnw21cam 2y ago
It's bad news for anyone who wants to buy a solar panel, because they'll be joining the thundering herd of people generating energy when the energy price is negative and there's too much generation in the grid already, and that is a complete waste. It's great news for someone who wants to buy a battery and actually reduce that waste by consuming it and making good use of it later. I have thought for a few years now that solar panels are no longer the best thing to expand - it's batteries instead now, and all the better if they are situated right next to the solar panels. Having said that, if you're on a fixed price domestic electricity supply, then yes it would make sense to install solar panels without batteries to match your peak power usage during the day, but that is going to be a very small installation in most cases. If you expand beyond that, then you're exporting to the grid and getting paid next to nothing for it.
- pfdietz 2y ago
  I don't have solar panels on my house, and have no intent to get them. I'll be happy if modest sized PV arrays pop up on unused land in my area and if I can tap that energy from the grid. The cost/W of such installations will be much below what I could get for my roof. If we get dynamic pricing, I very well may get home batteries though, especially if these could double as backup in case of grid outage.
  - toomuchtodo 2y ago
    > I'll be happy if modest sized PV arrays pop up on unused land in my area and if I can tap that energy from the grid. The cost/W of such installations will be much below what I could get for my roof. Not sure what state you're in, but community solar is very popular in several states, and if it is not in your state, I would encourage you to advocate for it. It is a reasonable alternative for those who do not want to install rooftop solar (or cannot, for whatever reason). https://www.energy.gov/eere/solar/community-solar-basics https://www.energy.gov/eere/solar/community-solar-basics https://www.seia.org/initiatives/community-solar https://www.seia.org/initiatives/community-solar https://www.nrel.gov/state-local-tribal/community-solar.html https://www.nrel.gov/state-local-tribal/community-solar.html
- 2y ago
Angostura 2y ago
I disagree that it’s bad news. It gives additional incentives for consumers to get battery systems to go with their solar. I live in the UK where prices go negative during periods of high wind/low demand. There are also times where demand is so high that the electricity companies will pay a big premium for consumers who cut their consumption for a couple of hours, or who sell back to the grid, to avoid having to start up reserve coal-fired power stations. I got batteries for my solar without any thought of them being very useful in winter, but in fact they are. I automatically force-charge when prices go negative and when the grid announces there is going to be an emergency need for power (usually a few hours notice), I’ll force charge and then force discharge during the time of need. https://octopus.energy/blog/farewell-saving-sessions-wrap-up/ https://octopus.energy/blog/farewell-saving-sessions-wrap-up...
- Gibbon1 2y ago
  My standard response to negative energy prices is, it's oh noes for energy suppliers and oh yes baby for industrial users. A medium electric arc furnace consumes 60MW. 17 of those can draw a GW.
  - pfdietz 2y ago
    There's a whole industrial technology -- bulk resistive heat storage -- that's popping up to deal with intermittent low or negative power prices. Temperatures as high as 1800 C can be stored in resistively heated refractory materials, then used to displace fossil fuel combustion in various industrial processes. The stored energy/mass and energy/cost in such materials can be very high.
    - Gibbon1 2y ago
      Yeah if you're calcining concrete clinker you'll happily use resistive heating if electricity is cheaper than nat gas. I like to bitch about people that think the free market solves everything but oh noes the price of electricity is negative is one thing I think the free market can totally solve.
  - deleted 2y ago
kthejoker2 2y ago
Negative price for production = positive price for storage. It is not bad news or good news in the aggregate, it just shifts things.
datadrivenangel 2y ago
More storage and Virtual Power Plants are a big part of the answer! By aggregating and networking more energy consuming resources, we can make load dispatchable to deal with intermittent renewables, and respond better to price signals. Cheaper, cleaner, and more reliable energy has the opportunity to be good for everyone. I wrote a book on this!

by roenxi 2y ago

AndrewDucker 2y ago

Negative pricing will lead to people building storage which can make use of it to charge, and then sell back when prices are positive again. It's an excellent signal of opportunity.

snapplebobapple 2y ago

No it doesnt mean either of those things. It means you built too much solar and made the grid more unstable given the physics constraints on short term supply and demand. Its not waste, it is not good.

thelastgallon 2y ago

There is a sustainable deal that can work with negative prices. Charge EVs when price is negative and pay the carowners. For this, car owners have to be always plugged in (except the 20m - 1hour) that they drive. When demand peaks, the cars can supply power back to the grid and make even more money! Households can put solar panels, provide the entire energy infrastructure: production and storage. Car batteries are ~6 times larger than powerwalls and powerwalls can make money supplying power back to the grid: https://electrek.co/2023/07/05/tesla-electric-customers-report-making-150-day/ https://electrek.co/2023/07/05/tesla-electric-customers-repo... We don't need peak power infrastructure (natural gas) which runs only a few hours per day. All of it can be replaced by EVs.

ikekkdcjkfke 2y ago

Let the market forces deal with it?

roenxi 2y ago
Yeah. The way market forces will deal with it is some energy sink will be figured out for the mid-day peak, and prices will stop going negative. But when that happens the average price of power generated from solar panels will probably drop (because less of the power generated by a panel is wasted, so the capital cost/power generated ratio improves) and consumers will be better off. I expect. These market effects are complicated. It is the opposite of what happened in, say, Germany. They started seeing negative power prices on the wholesale market then they ended up with average electricity prices that were among the most expensive in the world.
- imtringued 2y ago
  The EEG subsidy program is a joke. The government guarantees a minimum price on your feed-in tariff. This means if the price is negative 8 cents and the feed-in tariff is positive 8 cents (numbers are for illustration purposes), the government pays 16 cents. It's no different from what the central bank does with its zero lower bound guarantee on interest rates. The market rate on capital is negative? Gotta subsidize private capital holders with infinite QE. The guaranteed minimum price floor is zero, the interest rate is say -3%, the central bank essentially pays 3% interest to keep the house of cards from collapsing. Since negative interest rates cannot be represented in the current system, we have inflation as the band aid. The thing is, negative prices or interest rates aren't evil or bad on their own, they become dysfunctional the moment there is a guaranteed price floor. It's no different than a price ceiling. The only difference is shortage vs oversupply.
  - tcfhgj 2y ago
    First of all, this isn't true. In case the prices drop negative, the solar plant will be disconnected from the grid remotely and the solar plant owner will get what he had gotten if the solar plant had not been disconnected from the grid. Second, subsidizing once expensive but mostly cleanenergy production technology, allowed renewable energy to thrive to the number 1 energy source worldwide, theoretically allowing to ditch fossil energy production completely by 2050 and stay within low risk climate warming - without significant degrowth, which otherwise would have been required for a certainty. So no, EEG isn't a joke, but a huge win for humanity.

mnw21cam 2y ago

It's bad news for anyone who wants to buy a solar panel, because they'll be joining the thundering herd of people generating energy when the energy price is negative and there's too much generation in the grid already, and that is a complete waste. It's great news for someone who wants to buy a battery and actually reduce that waste by consuming it and making good use of it later. I have thought for a few years now that solar panels are no longer the best thing to expand - it's batteries instead now, and all the better if they are situated right next to the solar panels. Having said that, if you're on a fixed price domestic electricity supply, then yes it would make sense to install solar panels without batteries to match your peak power usage during the day, but that is going to be a very small installation in most cases. If you expand beyond that, then you're exporting to the grid and getting paid next to nothing for it.

pfdietz 2y ago
I don't have solar panels on my house, and have no intent to get them. I'll be happy if modest sized PV arrays pop up on unused land in my area and if I can tap that energy from the grid. The cost/W of such installations will be much below what I could get for my roof. If we get dynamic pricing, I very well may get home batteries though, especially if these could double as backup in case of grid outage.
- toomuchtodo 2y ago
  > I'll be happy if modest sized PV arrays pop up on unused land in my area and if I can tap that energy from the grid. The cost/W of such installations will be much below what I could get for my roof. Not sure what state you're in, but community solar is very popular in several states, and if it is not in your state, I would encourage you to advocate for it. It is a reasonable alternative for those who do not want to install rooftop solar (or cannot, for whatever reason). https://www.energy.gov/eere/solar/community-solar-basics https://www.energy.gov/eere/solar/community-solar-basics https://www.seia.org/initiatives/community-solar https://www.seia.org/initiatives/community-solar https://www.nrel.gov/state-local-tribal/community-solar.html https://www.nrel.gov/state-local-tribal/community-solar.html
2y ago

Angostura 2y ago

I disagree that it’s bad news. It gives additional incentives for consumers to get battery systems to go with their solar. I live in the UK where prices go negative during periods of high wind/low demand. There are also times where demand is so high that the electricity companies will pay a big premium for consumers who cut their consumption for a couple of hours, or who sell back to the grid, to avoid having to start up reserve coal-fired power stations. I got batteries for my solar without any thought of them being very useful in winter, but in fact they are. I automatically force-charge when prices go negative and when the grid announces there is going to be an emergency need for power (usually a few hours notice), I’ll force charge and then force discharge during the time of need. https://octopus.energy/blog/farewell-saving-sessions-wrap-up/ https://octopus.energy/blog/farewell-saving-sessions-wrap-up...

Gibbon1 2y ago
My standard response to negative energy prices is, it's oh noes for energy suppliers and oh yes baby for industrial users. A medium electric arc furnace consumes 60MW. 17 of those can draw a GW.
- pfdietz 2y ago
  There's a whole industrial technology -- bulk resistive heat storage -- that's popping up to deal with intermittent low or negative power prices. Temperatures as high as 1800 C can be stored in resistively heated refractory materials, then used to displace fossil fuel combustion in various industrial processes. The stored energy/mass and energy/cost in such materials can be very high.
  - Gibbon1 2y ago
    Yeah if you're calcining concrete clinker you'll happily use resistive heating if electricity is cheaper than nat gas. I like to bitch about people that think the free market solves everything but oh noes the price of electricity is negative is one thing I think the free market can totally solve.
- deleted 2y ago

kthejoker2 2y ago

Negative price for production = positive price for storage. It is not bad news or good news in the aggregate, it just shifts things.

datadrivenangel 2y ago

More storage and Virtual Power Plants are a big part of the answer! By aggregating and networking more energy consuming resources, we can make load dispatchable to deal with intermittent renewables, and respond better to price signals. Cheaper, cleaner, and more reliable energy has the opportunity to be good for everyone. I wrote a book on this!