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ERCOT has done a great job of setting up incentives, getting out of the way, and letting markets solve their problems. Working with CAISO and then going to set

ERCOT has done a great job of setting up incentives, getting out of the way, and letting markets solve their problems. Working with CAISO and then going to set up batteries in ERCOT was such a breath of fresh air for an old team of mine.

whatever1 1y ago
And tax payers pay for their F ups and then some additional bonuses to the gas traders of BP when Texas freezes. https://www.bloomberg.com/news/articles/2021-04-27/bp-emerges-as-another-big-winner-from-the-texas-freeze https://www.bloomberg.com/news/articles/2021-04-27/bp-emerge...
- WaxProlix 1y ago
  That's largely true, but on the flipside at least some of the rush of batteries into Texas to do ancillary services and provide redundancy are a result of greedy capitalists seeing the profits a few hundred MWh can get you in Texas (at taxpayer expense!) and rushing in to get a piece of the pie. So, markets!
  - bee_rider 1y ago
    Wait, how does it work? If the government is using taxpayer money to buy services… that’s not really a free market solution in the conventional sense, right? Of course if we have to pretend it is to get Texas to do it… fine I guess.
    - WaxProlix 1y ago
      Na, the utility payers actually pay it, though taxpayers pay for some of the infrastructure and administration, and given to some service providers in the form of tax breaks I think. The circles of that venn diagram are close to an overlap though.
- bz_bz_bz 1y ago
  Aside from shutting down some compressor stations that gas companies failed to properly register as essential equipment, ERCOT had almost nothing to do with NG prices. Gas and power are intertwined but still very separate markets. Natural gas would have gone even higher had ERCOT not shed load, so if you want to make reductionist statements about complex issues, you could say that ERCOT actually took away from the bonuses of BP gas traders who were long.
  - whatever1 1y ago
    They did not do their job to regulate the market. Set aside their failure to check for winterization and the complete failure of demand forecasting or execution of rolling blackouts (that ended up being uncontrolled week long power losses that literally killed people). They had almost uncapped max wholesale prices for energy during the blackouts. At some point it had reached 10k per megawatthour! Of course companies went bankrupt, and of course BP traders held bonus parties. The taxpayers apart from these they also had to bail out the bankrupt retailers.
    - bz_bz_bz 1y ago
      You haven't explained what any of that has to do with gas trading profits. HSC didn't go to $400/MMBtu because of ERCOT.
      - whatever1 1y ago
        If I was one of the last standing gas fueled energy producer / gas distributor with an energy price of $9k/MWhr I would take any gas price to ensure that I have the last available drop of gas. The sky high energy price and the collapse of gas supply were the fundamental price drivers. The alternative scenario is that the gas market players were just price gouging. Pick what you want.
        bz_bz_bz 1y ago
        > I would take any gas price to ensure that I have the last available drop of gas. This is true of any ISO in the country during extreme conditions and you wouldn’t want it to not be.

whatever1 1y ago

And tax payers pay for their F ups and then some additional bonuses to the gas traders of BP when Texas freezes. https://www.bloomberg.com/news/articles/2021-04-27/bp-emerges-as-another-big-winner-from-the-texas-freeze https://www.bloomberg.com/news/articles/2021-04-27/bp-emerge...

WaxProlix 1y ago
That's largely true, but on the flipside at least some of the rush of batteries into Texas to do ancillary services and provide redundancy are a result of greedy capitalists seeing the profits a few hundred MWh can get you in Texas (at taxpayer expense!) and rushing in to get a piece of the pie. So, markets!
- bee_rider 1y ago
  Wait, how does it work? If the government is using taxpayer money to buy services… that’s not really a free market solution in the conventional sense, right? Of course if we have to pretend it is to get Texas to do it… fine I guess.
  - WaxProlix 1y ago
    Na, the utility payers actually pay it, though taxpayers pay for some of the infrastructure and administration, and given to some service providers in the form of tax breaks I think. The circles of that venn diagram are close to an overlap though.
bz_bz_bz 1y ago
Aside from shutting down some compressor stations that gas companies failed to properly register as essential equipment, ERCOT had almost nothing to do with NG prices. Gas and power are intertwined but still very separate markets. Natural gas would have gone even higher had ERCOT not shed load, so if you want to make reductionist statements about complex issues, you could say that ERCOT actually took away from the bonuses of BP gas traders who were long.
- whatever1 1y ago
  They did not do their job to regulate the market. Set aside their failure to check for winterization and the complete failure of demand forecasting or execution of rolling blackouts (that ended up being uncontrolled week long power losses that literally killed people). They had almost uncapped max wholesale prices for energy during the blackouts. At some point it had reached 10k per megawatthour! Of course companies went bankrupt, and of course BP traders held bonus parties. The taxpayers apart from these they also had to bail out the bankrupt retailers.
  - bz_bz_bz 1y ago
    You haven't explained what any of that has to do with gas trading profits. HSC didn't go to $400/MMBtu because of ERCOT.
    - whatever1 1y ago
      If I was one of the last standing gas fueled energy producer / gas distributor with an energy price of $9k/MWhr I would take any gas price to ensure that I have the last available drop of gas. The sky high energy price and the collapse of gas supply were the fundamental price drivers. The alternative scenario is that the gas market players were just price gouging. Pick what you want.
      - bz_bz_bz 1y ago
        > I would take any gas price to ensure that I have the last available drop of gas. This is true of any ISO in the country during extreme conditions and you wouldn’t want it to not be.