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Cool so when will this translate into cheaper energy? Why am I paying $0.4 per kwh?
by okasaki 1y ago
Cool so when will this translate into cheaper energy? Why am I paying $0.4 per kwh?
- rwmj 1y agoThis project won't do anything (as you likely already know). The reason electricity is so expensive is because it's tied to gas prices, which is an entirely political decision.
- ZeroGravitas 1y agoBatteries will reduce the number of times gas sets the marginal price, so they will have a near immediate impact on that. They'll also likely reduce the balancing costs by relieving congestion. Probably too small to notice among all the other costs and changes, like deploying more renewables and starting to pay in advance for new nuclear.
- mytailorisrich 1y agoGas prices are a political decision, too in Europe. For demand to reduce and for other sources to be more competitive prices have to be and remain high. In the UK I believe it is policy for electricity prices to be high in general for thse reasons and to encourage lower usage.
- skippyboxedhero 1y agoRetail energy prices are subsidised. It isn't policy to encourage lower usage, the government is paying billions to sustain retail consumption (and yes, this is whilst another part of the government is driving prices higher). The issue in the UK is that we moved to renewables that can't produce energy at the margin, marginal prices are still driven by gas, and we simultaneously decided to shut down large amounts of non-renewable sources of energy to satisfy the ambitions of politicians. Result? Highest energy prices in the world, most energy-intensive industry shutting down, and massive reliance on political direction/regulators by industry (the original comment is not right, since the mid-2010s energy companies have been directed day-to-day by the state, invest in this project, don't do this anymore, etc. Our policy is made by people who wish the world was a certain way, reality doesn't matter to them).
- HPsquared 1y agoWe are all just paypigs, after all.
- mytailorisrich 1y agoIt is policy to encourage lower usage, like it is policy to keep prices up (both production and the grid are a shamble, not to mention climate commitments on top). Maybe the policy isn't publicly stated but actions speak louder than words. Of course this isn't popular so, at the same time, the governments takes measures to appear to try to keep prices lower. It is a political balancing act and subsidies are not incompatible with a policy of encouraging lower usage. It's the same as they are doing on immigration: They say they want to lower it but the actual policy is to keep it high. People have understood that now, which explains in big part the Conservative wipe out. Labour is now on the same path.
- tonyedgecombe 1y ago> Retail energy prices are subsidised. Retail electricity is taxed in the UK.
- youngtaff 1y agoBut that’s OK isn’t it - if we tax it people should use it more efficiently
- xnorswap 1y agoIsn't the price tied to the marginal price, rather than the price of gas? Even if they're typically the same, because CCGT is the best for on-demand generation, flattening the demand curve ought to slightly reduce that marginal cost. I've seen the UK generation market attacked quite a lot lately, but to me it makes sense to price everything at the marginal cost, and doing so also helps encourage capital investment in generation that can have lower generation costs themselves, because the marginal cost is only slowly impacted rather than a boom and bust model.
- justincormack 1y agoYeah we still need some more renewable capacity (and transmission) before gas usage can go to zero much of the time (which will need more batteries to deal with short term fluctuations). Right now we are using around 10% gas, which is a decent amount. Prices are still going negative at night some of the time, like last night.
- chippiewill 1y agoI agree, although I think one of the disadvantages in the UK is that the suppliers aren't paying the cost for their own volatility. A renewable supplier can add 1GW supply to the grid, but 1GW of natural gas generation capacity is still required. Fixed costs and capital costs end up being shouldered by the consumer which ironically ends up pushing overall costs up.
- lokeg 1y agoThis can be alleviated by the gas plant operator selling call options, effectively paying them for being reliable. The relevant keyword is "capacity markets".
- tomatocracy 1y agoThe current marginal market price is not the same as the current average price being paid for all electricity delivered. A lot is delivered via fixed price arrangements of one sort or another (CFDs, PPAs, etc) and then there are things like the Balancing Mechanism which is paid as bid, and capacity payments which are outside the marginal cost per kWh part of the system.
- benrutter 1y agoI think a big reason for net-zero policies getting bad press, is that these kind of things are difficult to quantify. Energy is largely set by gas price, so having more non-gas assets on the grid probably means you do have cheaper energy (or, at least will have much cheaper energy in the future when gas ceases to dictate the energy price) I guess what we can't do is step into the alternative world where there's less batteries and renewables, and complain about paying $0.6 per kwh.
- blitzar 1y agoI'm paying £0.06 at the moment and I got paid to use electricity on the weekend thanks to the sun shining and wind blowing.
- okasaki 1y agoI don't know how you're accomplishing that. The lowest mine goes is $0.3 1am-4am.
- scrlk 1y agoProbably on a half-hourly tariff, e.g. Agile Octopus: https://www.octopriceuk.app/agile https://www.octopriceuk.app/agile
- okasaki 1y agoSo on the site itself it says Agile prices can spike up to 100 p/kWh any time - although a typical household in Winter '22-'23 paid around 35 p/kWh average. so that's even more than I'm paying. This seems to only make sense if you have some sort of intelligent battery system.
- scrlk 1y agoYou can make that tariff work without a battery, just that you need to be flexible when it comes to load shifting to maximise the savings. Moving consumption out of evening peaks would be enough over a course of a year.
- frabcus 1y agoI use that tariff, with no home battery or home solar or electric car. Saves about 1/3rd off my electricity bill. My only behaviour change has been to not run the washing machine 4pm-8pm. It's great! I assume I'll get hit by a price spike at some point, hasn't happened for a couple of years so far. Average unit cost for me yesterday was 4.35p/kWh.
- 1y ago
- happosai 1y agoIf you are paying for electricity in dollars, this battery won't translate to cheaper energy for you. The battery is in Scotland.
- okasaki 1y agoI'm just translating for USD for an American audience.
- hgomersall 1y agoEssex
- tialaramex 1y agoWhich, to be clear is: Not in Scotland, and, is in fact very far from Scotland. In terms of countries, it's closer to France, or Belgium, or the Netherlands than to Scotland. It is in the UK though, so, if your model of where "Scotland" is just means vaguely "the United Kingdom somewhere" and thus also includes London then yeah, close enough.
- gadders 1y agoNot really. The higher proportion of renewables a country has, the more expensive the energy. See the chart on this page: https://ca.finance.yahoo.com/news/bjorn-lomborg-solar-wind-power-100008520.html https://ca.finance.yahoo.com/news/bjorn-lomborg-solar-wind-p...
- Lio 1y agoPersonally, I'd take Bob Ward's analysis over Bjorn Lomborg's. https://www.lse.ac.uk/granthaminstitute/news/more-misinformation-and-nonsense-on-climate-from-lomborg-and-tol/ https://www.lse.ac.uk/granthaminstitute/news/more-misinforma...
- gadders 1y agoI'd like to see them debate. All I know is my energy cost keeps going up in the UK, and we seem to have some of the most expensive energy in the world.
- Lio 1y agoWe do and I share your concerns. As far as I can see pricing electricity on the marginal costs of gas has not been a good strategy. I think we should be charged the true cost of generation which is something like 8 times lower for renewables.
- tialaramex 1y agoThe question is, if I'm going to be paid only "true cost of generation" why would I perform any generation? I also don't want to be paid only "true cost of labour" for my work, I'll take the wages you offered thanks, not my "true cost".
- Lio 1y agoSorry, maybe "market rate" would be better phrasing on my part. I assume there's a mark up in there even if I didn't say it. My point is that base cost of gas is so much higher than renewable energy that we are crippling our economy by forcing the renewable engergy market rate to be based on the market price of gas.
- rcxdude 1y agoOnce there's enough renewables and batteries that the UK is running off of near 100% renewables a decent fraction of the time, so the price is not being set by the gas turbines making up the margin.
- deleted 1y ago[deleted]
- AnotherGoodName 1y agoPretty much straight away actually. In Australia prices were reduced by over $50 a year per person in the state on average once a similar battery went online. Similar policies and market there to this case too. Details: https://en.m.wikipedia.org/wiki/Hornsdale_Power_Reserve https://en.m.wikipedia.org/wiki/Hornsdale_Power_Reserve I get that it's easy to be pessimistic but batteries like the above not only pay themselves off in 2years (From the article above, $46million profit in one year alone on a $90million install cost!) they also cut prices on the grid from day one. Behind the scenes prices can fluctuate between <0 and >100x baseline. These types of installations immediately smooth out the costs. As long as you have competing wholesalers/providers the price reductions will come through pretty quickly based on similar cases.
- hdgvhicv 1y agoOne issue the U.K. has is a grid bottleneck but wiggle pricing across the grid. While excess power may be available in some places, there’s not enough interconnection to move it where it’s needed, so those with excess power (lots of wind etc) can’t benefit.
- 3eb7988a1663 1y agoIf the batteries are installed south of the interconnect, won't that help the problem?
- hdgvhicv 1y agoCertainly, and these are small improvements that add up over time. People won’t appreciate them though, and will just listen k the “drill baby drill” coming from the tories and reform