5 ms·

Aren't higher energy prices exactly what we need to combat climate change though?

by aftbit 2y ago

_aavaa_ 2y ago
Not really. We need polluting energy sources to be charged for their pollution, ie stop using the atmosphere and land as a free sewer, which in turn will put renewables on an equal footing. Though even without that, solar, wind, and batteries are already cheaper.
- robertlagrant 2y ago
  Isn't that the same? You want to raise the price of energy to make wind etc competitive?
  - rawgabbit 2y ago
    Sound bites drives political discussion. When a polluting industry poisons the air and the water and people go to the hospital because they are coughing or they have dysentery, who will pay to cleanup the mess? If you frame the discussion as about “price” it is a non-starter. I would argue it is better to talk about workers and their families. As in let us not shit in the river so our children don’t get sick and can go to school. Let us not poison the air so workers can do their jobs and not go to hospital.
    - robertlagrant 2y ago
      This seems disingenuous twice: 1. You're welcome to argue that, but you haven't here. You've just stated it. 2. You shouldn't supplant one topic with another. High energy prices kill people, because energy drives the cost of everything, and people can direct less value into things that keep them healthy if they're spending a greater proportion of their income on survival. You can say "also air should be clean", fine, but not "Don't think about prices! Look over here instead!"
      - Tade0 2y ago
        1. Air pollution kills more. 2. You can have your cake and eat it, if you drop the requirement to buy electricity at the price of the most expensive component in the mix. Spain did just that and they're currently experiencing an industrial revival thanks to comparatively low energy prices.
      - rawgabbit 2y ago
        No, I would argue I am correctly framing externalized costs ie the tragedy of the commons.
        robertlagrant 2y ago
        The context is "You want to raise the price of energy to make wind etc competitive?" Adding a separate topic seems like a distraction. Everyone knows about negative externalities. I don't think we need to rehearse the same points to obscure the specific one I'm asking about.
      - Kim_Bruning 2y ago
        I think Rawgabbit is trying to get at the point that you need to price in the externalities to find the actual value of something. They're trying to explain in good faith as far as I can tell.
      - Sabinus 2y ago
        >High energy prices kill people Indeed, and so does air pollution. Having (accurate) prices on both allows the market to reduce pollution and energy costs efficiently.
  - smackeyacky 2y ago
    No, you just need fossil fuel energy to be relatively more expensive, not for energy to be more expensive overall. It's happened already but we're currently being held hostage by the coal burners while they scramble to extract the last bit of rent they can.
    - lurk2 2y ago
      There is no way to make fossil fuel more expensive without making energy more expensive overall, because fossil fuel is included in the category of "energy overall." The effect of making fossil fuels more expensive is that energy prices will rise. The point of the GP ("Not really. We need polluting energy sources to be charged for their pollution, ie stop using the atmosphere and land as a free sewer, which in turn will put renewables on an equal footing.") is that the goal is not to raise the cost of energy as a whole (even though this is the inevitable outcome of higher fossil fuel prices), but instead to price in the negative externalities generated by fossil fuels. Put another way, in a world where fossil fuels are no longer consumed, there isn't any reason to limit energy consumption for its sake, since the whole point was to encourage adoption of cleaner technologies. There is a case to be made that this isn't true, since even the "clean" technologies have an environmental impact, but that is tangential to the discussion.
      - smackeyacky 2y ago
        I no longer think it's politically possible to charge anybody for climate externalities, since those people own our governments. We are basically stuck until even those guys realise that coal is a loser just for practical, non carbon priced reasons.
    - robertlagrant 2y ago
      > No, you just need fossil fuel energy to be relatively more expensive, not for energy to be more expensive overall. Can you explain exactly what you mean? Say (very made up numbers) coal is $1 per day, and a renewable is $2 per day. I raise the price of coal to $3 per day to make it relatively more expensive. Haven't I just increased the price of energy overall to $2 per day?
  - youngtaff 2y ago
    Wind is competitive already… the price of electricity in the UK is set by the gas fired power generators
    - lurk2 2y ago
      Wind isn't going to power the grid by itself.
legitster 2y ago
Only high oil and gas prices specifically. And honestly, low gas prices is good if it helps move away from coal. But unfortunately, even the most liberal political groups have walked back any interest in solving climate change at the margin. You see this with the endless life of the "100 companies cause climate change" misinformation.
- laughingcurve 2y ago
  That 100 companies canard is really terrible. It's seeking a villain to blame instead of addressing the system problems and it's second or third order effects such as climate change. I understand it probably motivates some folks but I can't help but roll my eyes.
- harimau777 2y ago
  The deeper problem might be that they gave up on fighting inequality; which would give regular people enough breathing room to make changes on the margin. Without that, the argument is basically "We know that life is barely worth living, but we aren't going to help with that. Instead we want to make your life even worse to save the environment!"
- ben_w 2y ago
  > And honestly, low gas prices is good if it helps move away from coal. Good news, the UK has completely moved away from coal: https://www.theguardian.com/business/2024/sep/30/end-of-an-era-as-britains-last-coal-fired-power-plant-shuts-down https://www.theguardian.com/business/2024/sep/30/end-of-an-e...
- starspangled 2y ago
  China now emits almost 2x the carbon per capita than the UK, and alone emits more than all western countries combined including the US. The UK can't solve climate change at the margin or anywhere else with domestic energy policy. China is now consuming record amounts of coal (the globe has not actually even reached peak-coal yet despite claims we'd already passed it going back decades and despite western coal consumption taking a nosedive starting about 20 years ago). Which is strange considering that it has also been an enormous producer and exporter of allegedly much cheaper solar and wind generators for many years. Something doesn't add up here, and further disadvantaging much cleaner domestic industry and driving production offshore to countries with far higher emissions intensity of production (not to mention many other environmental and humanitraian issues) is not the way to solve climate change. It could be making it even worse.
SmartyPants700 2y ago
[flagged]
- Pet_Ant 2y ago
  Because climate change will somehow not effect the poor? 1) we need hire energy prices to match the externalities 2) we need subsidies to make the poor more efficient at using the power they can afford. I heard in England they don't have proper insulation in most homes. Building to passive house standards can completely transform an energy bill.
  - nradov 2y ago
    If the IPCC global climate change projections are accurate then poor UK residents will probably experience smaller effects than poor people in many other countries. So they may see it as less of a concern than short-term energy costs. https://www.ipcc.ch/report/ar4/wg1/global-climate-projections/ https://www.ipcc.ch/report/ar4/wg1/global-climate-projection...
  - EndShell 2y ago
    > we need subsidies to make the poor more efficient at using the power they can afford. They already have grants and subsidies that people can apply for. https://www.gov.uk/government/collections/find-energy-grants-for-you-home-help-to-heat https://www.gov.uk/government/collections/find-energy-grants... > I heard in England they don't have proper insulation in most homes. Almost every house and apartment I've lived in had had some sort of insulation and double/triple glazing fitted on the windows. So I found this quite hard to believe so I looked it up. https://assets.publishing.service.gov.uk/media/5a7c19d040f0b61a825d674b/statistical_release_estimates_home_insulation_levels_gb_july_13.pdf https://assets.publishing.service.gov.uk/media/5a7c19d040f0b... Official stats from 12 years ago say that ~70% of properties do have cavity wall and loft insulation as of 2013. > Building to passive house standards can completely transform an energy bill. They are plenty of regulations on how new houses are built on how energy efficient they are. However we cannot build enough housing for a number of numerous reasons to meet current demand.
  - ben_w 2y ago
datavirtue 2y ago
Energy costs should probably be progressive. If you need more than the poor your cost starts shooting through the roof. This reminds me of that popular "reality" show where they remodel a family's home and surprise them with what is basically a palace. Afterward the families are shattered by energy costs, and eventually exorbitant property taxes. Off camera they are forced into forclosure and end up in debt. After the first month or so they are forced to seal off most of the house as they desperately try to stay afloat. Lacking financial savvy, most end up mortgaging the home.
- david-gpu 2y ago
  A carbon dividend solves that problem. Put a price on each ton of carbon released in the atmosphere, then redistribute an equal dividend to each citizen. The wealthiest people will end up paying more than they receive back, while the poorest will receive a boost. All while incentivizing low carbon alternatives in every sector of the economy.
throwawaymanbot 2y ago
[dead]
mattlondon 2y ago
It's higher energy prices yes, but that means higher everything prices. Even if your energy tariff is a 100% renewable one you still pay the dirty gas price because of the way the market is set up. Combine that with high costs of housing (both to purchase but also to rent) and people are, generally speaking, fucked and living paycheck to paycheck. Renters especially live a precarious life where prices regularly go up 10% per year and you might be legally told to leave with not much more than a month's notice leading to much upheaval and associated costs.
- dmix 2y ago
  That's a system that benefits mega-corporations running everything. Housing/cost of living is so expensive it cripples most upward mobility as regular people can't take risks investing/starting a business/switching careers/etc or have savings because they can barely afford rent. The only ones building/buying houses are real estate investors who can afford to navigate the complex market rules, so you'll be stuck working for one and renting from another.
ChocolateGod 2y ago
In the UK the energy market is broken, the costs of electricity is based on what the most expensive source is currently on the grid. The UK has a lot of wind (shallow waters, strong wind blasts from Atlantic etc) and wind is significantly cheaper, but because there's gas still on the grid everyone pays the higher gas based price even if energy is mostly coming from cheaper wind. Yes, the renewable cleaner energy is actually cheaper than the fossil fuel it's replacing and in a perfect world should reduce bills.
- cavisne 2y ago
  It's based on the most expensive source that is required to meet demand. If there is enough wind to meet demand then gas is not needed or factored in to the price. All markets (not just energy markets) work in this way.
- lurk2 2y ago
  > because there's gas still on the grid everyone pays the higher gas based price even if energy is mostly coming from cheaper wind You're describing how a market functions. If the gas plants went offline tomorrow, could the wind turbines produce sufficient energy to power the national grid?
- chippiewill 2y ago
  That is a very common and overly simplistic view of the UK's energy market. What you have described is essentially the UK's day-ahead and spot energy markets. The whole point of those markets is to ensure demand is met with near 100% certainty. Setting the price to the last bidder is not unique to the UK for energy pricing, if it were not present then everyone would be speculating what the threshold would be and giving high bids and it would make the market unstable. There are other markets in the UK that behave very differently (such as the ones that green energy companies use to buy 100% renewable energy 6 months ahead of time). In practice UK electricity prices _are_ much cheaper from wind and solar energy, most of the time, because virtually all of that capacity in the UK was built under what is known as a CFD (contracts for difference) basis. The exact mechanism is a bit subtle [1], but in essence renewables built that way have a fixed price per unit of energy (usually for 20 years after construction). This price is less than what the gas energy producers typically bid in the UK. The reasons why electricity prices are still on average very high in the UK is because the rest of the energy market is _so_ exposed to gas prices and renewables can't produce electricity a lot of the time (because it's not always windy, and it's not always light outside). Renewable production is highly correlated with itself and not necessarily aligned with demand. The UK also has other structural problems in the electricity system that have arisen from its exposure to renewables that come with associated costs. For example wind turbines in Scotland often get paid to _turn off_ because their power can't be transmitted to the south of England where it can be used - there are similar constraints with North sea production. Wind turbines and solar panels replacing traditional coal power stations means that the electricity grid has lost a lot of its traditional load balancing and stability mechanisms (conventional power plants provide a lot of stability because large rotational mass synchronised to the grid frequency provides inertia in the entire grid - wind turbine rotation is independent of the grid frequency). ESO now has to have more drastic and expensive mechanisms like demand reduction and rapid response hot reserves in-place. A lot of these issues are transient and will get cheaper over time, but they've become acute in the short-term with the UK's rapid grid decarbonisation. [1] they get paid directly from the day-ahead, spot, and other markets at the last bidder price. But they either have to refund any amount over their fixed price, or they receive a top-up from the energy companies so that they effectively got the fixed price.
dismalaf 2y ago
Not necessarily. You could argue that you want coal and gas to be expensive so that people build out renewables. But the places with the cheapest electricity generally have hydro, nuclear or wind, which are all zero carbon.
typewithrhythm 2y ago
The issue is there is currently no mechanism for end consumers to moderate their behaviour based on energy related emissions. Currently if users as a group demand more power than clean can provide, dirty gets turned on and everyone pays the highest cost. We need a way for a consumer to be able to commit to only clean power, potentially at a lower cost but with limited supply.
- vkou 2y ago
  Do you not get charged different rates based on usage amounts? This is common across the world - where the first X KWH of usage per month cost a lot less than the next X.
  - typewithrhythm 2y ago
    Commercial contracts generally don't work that way, they generally pay the market rate (the current most expensive producer). It means there is no way for an individual consumers behaviour to drive (or be driven by) the green energy proportion, as if the collective demand is too high then you pay the market rate for coal anyway.
ben_w 2y ago
> Aren't higher energy prices exactly what we need to combat climate change though? No. What you need to combat climate change is cheap green energy, and "green" is just a different question entirely to "cost". If you have expensive energy, regardless of how green it is or isn't, you get poverty. If you have greenhouse-gas-emitting energy, regardless of how cheap or expensive it is, you get climate change. 20 years ago, all the green energy was expensive; now, green energy is the cheapest around.
- dataflow 2y ago
  I assumed they meant higher prices for non-green energy than green energy.
- mistrial9 2y ago
  > now, green energy is the cheapest great to notice, but the overview falls short.. price signals are supposed to trigger conservation yet somehow, that is not discussed. Also note that energy markets have lifecycles.. it takes investment and infrastructure to make and deliver energy. Fossil fuels have done that in the past.
  - ben_w 2y ago
    > signals are supposed to trigger conservation yet somehow, that is not discussed Energy conservation has been discussed my entire life. When I was a kid, it was things like double glazing, close windows, wear pullovers indoors, turn off lights when you leave a room, CFLs. Late teen to young adult, increased loft insulation, cavity wall insulation. Energy efficiency standards for consumer goods. Cars getting taxed based on emissions. More recently, a campaign group literally called "Insulate Britain": https://en.wikipedia.org/wiki/Insulate_Britain_protests https://en.wikipedia.org/wiki/Insulate_Britain_protests > Fossil fuels have one that in the past At first, but the last coal plant has been closed, and renewables are ascendent — just past midnight UK time and still 28.5% renewables, average for last week 33.6%, and for last year 36.8%: https://grid.iamkate.com/ https://grid.iamkate.com/
vkou 2y ago
No, if you want to have a stable standard of living, you need higher energy prices for polluting energy sources, and lower energy prices for non-polluting energy sources. Then, to make killing this political suicide, make sure to mail every man, woman, and dog a check every two weeks called 'CARBON DIVIDEND'.
- Marsymars 2y ago
  > Then, to make killing this political suicide, make sure to mail every man, woman, and dog a check every two weeks called 'CARBON DIVIDEND'. We effectively did this in Canada and it still became a political albatross. (Though in practice the cheque was done via direct deposit and a lot of people didn't realize where the money was coming from despite it being clearly labelled. I think cheques in the mail would have been more effective.)

Aren't higher energy prices exactly what we need to combat climate change though?

by aftbit 2y ago

Aren't higher energy prices exactly what we need to combat climate change though?

Not really. We need polluting energy sources to be charged for their pollution, ie stop using the atmosphere and land as a free sewer, which in turn will put renewables on an equal footing. Though even without that, solar, wind, and batteries are already cheaper.

robertlagrant 2y ago
Isn't that the same? You want to raise the price of energy to make wind etc competitive?
- rawgabbit 2y ago
  Sound bites drives political discussion. When a polluting industry poisons the air and the water and people go to the hospital because they are coughing or they have dysentery, who will pay to cleanup the mess? If you frame the discussion as about “price” it is a non-starter. I would argue it is better to talk about workers and their families. As in let us not shit in the river so our children don’t get sick and can go to school. Let us not poison the air so workers can do their jobs and not go to hospital.
  - robertlagrant 2y ago
    This seems disingenuous twice: 1. You're welcome to argue that, but you haven't here. You've just stated it. 2. You shouldn't supplant one topic with another. High energy prices kill people, because energy drives the cost of everything, and people can direct less value into things that keep them healthy if they're spending a greater proportion of their income on survival. You can say "also air should be clean", fine, but not "Don't think about prices! Look over here instead!"
    - Tade0 2y ago
      1. Air pollution kills more. 2. You can have your cake and eat it, if you drop the requirement to buy electricity at the price of the most expensive component in the mix. Spain did just that and they're currently experiencing an industrial revival thanks to comparatively low energy prices.
    - rawgabbit 2y ago
      No, I would argue I am correctly framing externalized costs ie the tragedy of the commons.
      - robertlagrant 2y ago
        The context is "You want to raise the price of energy to make wind etc competitive?" Adding a separate topic seems like a distraction. Everyone knows about negative externalities. I don't think we need to rehearse the same points to obscure the specific one I'm asking about.
    - Kim_Bruning 2y ago
      I think Rawgabbit is trying to get at the point that you need to price in the externalities to find the actual value of something. They're trying to explain in good faith as far as I can tell.
    - Sabinus 2y ago
      >High energy prices kill people Indeed, and so does air pollution. Having (accurate) prices on both allows the market to reduce pollution and energy costs efficiently.
- smackeyacky 2y ago
  No, you just need fossil fuel energy to be relatively more expensive, not for energy to be more expensive overall. It's happened already but we're currently being held hostage by the coal burners while they scramble to extract the last bit of rent they can.
  - lurk2 2y ago
    There is no way to make fossil fuel more expensive without making energy more expensive overall, because fossil fuel is included in the category of "energy overall." The effect of making fossil fuels more expensive is that energy prices will rise. The point of the GP ("Not really. We need polluting energy sources to be charged for their pollution, ie stop using the atmosphere and land as a free sewer, which in turn will put renewables on an equal footing.") is that the goal is not to raise the cost of energy as a whole (even though this is the inevitable outcome of higher fossil fuel prices), but instead to price in the negative externalities generated by fossil fuels. Put another way, in a world where fossil fuels are no longer consumed, there isn't any reason to limit energy consumption for its sake, since the whole point was to encourage adoption of cleaner technologies. There is a case to be made that this isn't true, since even the "clean" technologies have an environmental impact, but that is tangential to the discussion.
    - smackeyacky 2y ago
      I no longer think it's politically possible to charge anybody for climate externalities, since those people own our governments. We are basically stuck until even those guys realise that coal is a loser just for practical, non carbon priced reasons.
  - robertlagrant 2y ago
    > No, you just need fossil fuel energy to be relatively more expensive, not for energy to be more expensive overall. Can you explain exactly what you mean? Say (very made up numbers) coal is $1 per day, and a renewable is $2 per day. I raise the price of coal to $3 per day to make it relatively more expensive. Haven't I just increased the price of energy overall to $2 per day?
- youngtaff 2y ago
  Wind is competitive already… the price of electricity in the UK is set by the gas fired power generators
  - lurk2 2y ago
    Wind isn't going to power the grid by itself.

legitster 2y ago

Only high oil and gas prices specifically. And honestly, low gas prices is good if it helps move away from coal. But unfortunately, even the most liberal political groups have walked back any interest in solving climate change at the margin. You see this with the endless life of the "100 companies cause climate change" misinformation.

laughingcurve 2y ago
That 100 companies canard is really terrible. It's seeking a villain to blame instead of addressing the system problems and it's second or third order effects such as climate change. I understand it probably motivates some folks but I can't help but roll my eyes.
harimau777 2y ago
The deeper problem might be that they gave up on fighting inequality; which would give regular people enough breathing room to make changes on the margin. Without that, the argument is basically "We know that life is barely worth living, but we aren't going to help with that. Instead we want to make your life even worse to save the environment!"
ben_w 2y ago
> And honestly, low gas prices is good if it helps move away from coal. Good news, the UK has completely moved away from coal: https://www.theguardian.com/business/2024/sep/30/end-of-an-era-as-britains-last-coal-fired-power-plant-shuts-down https://www.theguardian.com/business/2024/sep/30/end-of-an-e...
starspangled 2y ago
China now emits almost 2x the carbon per capita than the UK, and alone emits more than all western countries combined including the US. The UK can't solve climate change at the margin or anywhere else with domestic energy policy. China is now consuming record amounts of coal (the globe has not actually even reached peak-coal yet despite claims we'd already passed it going back decades and despite western coal consumption taking a nosedive starting about 20 years ago). Which is strange considering that it has also been an enormous producer and exporter of allegedly much cheaper solar and wind generators for many years. Something doesn't add up here, and further disadvantaging much cleaner domestic industry and driving production offshore to countries with far higher emissions intensity of production (not to mention many other environmental and humanitraian issues) is not the way to solve climate change. It could be making it even worse.

SmartyPants700 2y ago

[flagged]

Pet_Ant 2y ago
Because climate change will somehow not effect the poor? 1) we need hire energy prices to match the externalities 2) we need subsidies to make the poor more efficient at using the power they can afford. I heard in England they don't have proper insulation in most homes. Building to passive house standards can completely transform an energy bill.
- nradov 2y ago
  If the IPCC global climate change projections are accurate then poor UK residents will probably experience smaller effects than poor people in many other countries. So they may see it as less of a concern than short-term energy costs. https://www.ipcc.ch/report/ar4/wg1/global-climate-projections/ https://www.ipcc.ch/report/ar4/wg1/global-climate-projection...
- EndShell 2y ago
  > we need subsidies to make the poor more efficient at using the power they can afford. They already have grants and subsidies that people can apply for. https://www.gov.uk/government/collections/find-energy-grants-for-you-home-help-to-heat https://www.gov.uk/government/collections/find-energy-grants... > I heard in England they don't have proper insulation in most homes. Almost every house and apartment I've lived in had had some sort of insulation and double/triple glazing fitted on the windows. So I found this quite hard to believe so I looked it up. https://assets.publishing.service.gov.uk/media/5a7c19d040f0b61a825d674b/statistical_release_estimates_home_insulation_levels_gb_july_13.pdf https://assets.publishing.service.gov.uk/media/5a7c19d040f0b... Official stats from 12 years ago say that ~70% of properties do have cavity wall and loft insulation as of 2013. > Building to passive house standards can completely transform an energy bill. They are plenty of regulations on how new houses are built on how energy efficient they are. However we cannot build enough housing for a number of numerous reasons to meet current demand.
- ben_w 2y ago

datavirtue 2y ago

Energy costs should probably be progressive. If you need more than the poor your cost starts shooting through the roof. This reminds me of that popular "reality" show where they remodel a family's home and surprise them with what is basically a palace. Afterward the families are shattered by energy costs, and eventually exorbitant property taxes. Off camera they are forced into forclosure and end up in debt. After the first month or so they are forced to seal off most of the house as they desperately try to stay afloat. Lacking financial savvy, most end up mortgaging the home.

david-gpu 2y ago
A carbon dividend solves that problem. Put a price on each ton of carbon released in the atmosphere, then redistribute an equal dividend to each citizen. The wealthiest people will end up paying more than they receive back, while the poorest will receive a boost. All while incentivizing low carbon alternatives in every sector of the economy.

throwawaymanbot 2y ago

[dead]

mattlondon 2y ago

It's higher energy prices yes, but that means higher everything prices. Even if your energy tariff is a 100% renewable one you still pay the dirty gas price because of the way the market is set up. Combine that with high costs of housing (both to purchase but also to rent) and people are, generally speaking, fucked and living paycheck to paycheck. Renters especially live a precarious life where prices regularly go up 10% per year and you might be legally told to leave with not much more than a month's notice leading to much upheaval and associated costs.

dmix 2y ago
That's a system that benefits mega-corporations running everything. Housing/cost of living is so expensive it cripples most upward mobility as regular people can't take risks investing/starting a business/switching careers/etc or have savings because they can barely afford rent. The only ones building/buying houses are real estate investors who can afford to navigate the complex market rules, so you'll be stuck working for one and renting from another.

ChocolateGod 2y ago

In the UK the energy market is broken, the costs of electricity is based on what the most expensive source is currently on the grid. The UK has a lot of wind (shallow waters, strong wind blasts from Atlantic etc) and wind is significantly cheaper, but because there's gas still on the grid everyone pays the higher gas based price even if energy is mostly coming from cheaper wind. Yes, the renewable cleaner energy is actually cheaper than the fossil fuel it's replacing and in a perfect world should reduce bills.

cavisne 2y ago
It's based on the most expensive source that is required to meet demand. If there is enough wind to meet demand then gas is not needed or factored in to the price. All markets (not just energy markets) work in this way.
lurk2 2y ago
> because there's gas still on the grid everyone pays the higher gas based price even if energy is mostly coming from cheaper wind You're describing how a market functions. If the gas plants went offline tomorrow, could the wind turbines produce sufficient energy to power the national grid?
chippiewill 2y ago
That is a very common and overly simplistic view of the UK's energy market. What you have described is essentially the UK's day-ahead and spot energy markets. The whole point of those markets is to ensure demand is met with near 100% certainty. Setting the price to the last bidder is not unique to the UK for energy pricing, if it were not present then everyone would be speculating what the threshold would be and giving high bids and it would make the market unstable. There are other markets in the UK that behave very differently (such as the ones that green energy companies use to buy 100% renewable energy 6 months ahead of time). In practice UK electricity prices _are_ much cheaper from wind and solar energy, most of the time, because virtually all of that capacity in the UK was built under what is known as a CFD (contracts for difference) basis. The exact mechanism is a bit subtle [1], but in essence renewables built that way have a fixed price per unit of energy (usually for 20 years after construction). This price is less than what the gas energy producers typically bid in the UK. The reasons why electricity prices are still on average very high in the UK is because the rest of the energy market is _so_ exposed to gas prices and renewables can't produce electricity a lot of the time (because it's not always windy, and it's not always light outside). Renewable production is highly correlated with itself and not necessarily aligned with demand. The UK also has other structural problems in the electricity system that have arisen from its exposure to renewables that come with associated costs. For example wind turbines in Scotland often get paid to _turn off_ because their power can't be transmitted to the south of England where it can be used - there are similar constraints with North sea production. Wind turbines and solar panels replacing traditional coal power stations means that the electricity grid has lost a lot of its traditional load balancing and stability mechanisms (conventional power plants provide a lot of stability because large rotational mass synchronised to the grid frequency provides inertia in the entire grid - wind turbine rotation is independent of the grid frequency). ESO now has to have more drastic and expensive mechanisms like demand reduction and rapid response hot reserves in-place. A lot of these issues are transient and will get cheaper over time, but they've become acute in the short-term with the UK's rapid grid decarbonisation. [1] they get paid directly from the day-ahead, spot, and other markets at the last bidder price. But they either have to refund any amount over their fixed price, or they receive a top-up from the energy companies so that they effectively got the fixed price.

dismalaf 2y ago

Not necessarily. You could argue that you want coal and gas to be expensive so that people build out renewables. But the places with the cheapest electricity generally have hydro, nuclear or wind, which are all zero carbon.

typewithrhythm 2y ago

The issue is there is currently no mechanism for end consumers to moderate their behaviour based on energy related emissions. Currently if users as a group demand more power than clean can provide, dirty gets turned on and everyone pays the highest cost. We need a way for a consumer to be able to commit to only clean power, potentially at a lower cost but with limited supply.

vkou 2y ago
Do you not get charged different rates based on usage amounts? This is common across the world - where the first X KWH of usage per month cost a lot less than the next X.
- typewithrhythm 2y ago
  Commercial contracts generally don't work that way, they generally pay the market rate (the current most expensive producer). It means there is no way for an individual consumers behaviour to drive (or be driven by) the green energy proportion, as if the collective demand is too high then you pay the market rate for coal anyway.

ben_w 2y ago

> Aren't higher energy prices exactly what we need to combat climate change though? No. What you need to combat climate change is cheap green energy, and "green" is just a different question entirely to "cost". If you have expensive energy, regardless of how green it is or isn't, you get poverty. If you have greenhouse-gas-emitting energy, regardless of how cheap or expensive it is, you get climate change. 20 years ago, all the green energy was expensive; now, green energy is the cheapest around.

dataflow 2y ago
I assumed they meant higher prices for non-green energy than green energy.
mistrial9 2y ago
> now, green energy is the cheapest great to notice, but the overview falls short.. price signals are supposed to trigger conservation yet somehow, that is not discussed. Also note that energy markets have lifecycles.. it takes investment and infrastructure to make and deliver energy. Fossil fuels have done that in the past.
- ben_w 2y ago
  > signals are supposed to trigger conservation yet somehow, that is not discussed Energy conservation has been discussed my entire life. When I was a kid, it was things like double glazing, close windows, wear pullovers indoors, turn off lights when you leave a room, CFLs. Late teen to young adult, increased loft insulation, cavity wall insulation. Energy efficiency standards for consumer goods. Cars getting taxed based on emissions. More recently, a campaign group literally called "Insulate Britain": https://en.wikipedia.org/wiki/Insulate_Britain_protests https://en.wikipedia.org/wiki/Insulate_Britain_protests > Fossil fuels have one that in the past At first, but the last coal plant has been closed, and renewables are ascendent — just past midnight UK time and still 28.5% renewables, average for last week 33.6%, and for last year 36.8%: https://grid.iamkate.com/ https://grid.iamkate.com/

vkou 2y ago

No, if you want to have a stable standard of living, you need higher energy prices for polluting energy sources, and lower energy prices for non-polluting energy sources. Then, to make killing this political suicide, make sure to mail every man, woman, and dog a check every two weeks called 'CARBON DIVIDEND'.

Marsymars 2y ago
> Then, to make killing this political suicide, make sure to mail every man, woman, and dog a check every two weeks called 'CARBON DIVIDEND'. We effectively did this in Canada and it still became a political albatross. (Though in practice the cheque was done via direct deposit and a lot of people didn't realize where the money was coming from despite it being clearly labelled. I think cheques in the mail would have been more effective.)