4 ms·

The irony is at the time of me writing this; gas is down to 4.6%[^1] and renewables are a whopping 88.5% and yep - the cost is based on the 4.6% of gas. ^1 htt

The irony is at the time of me writing this; gas is down to 4.6%[^1] and renewables are a whopping 88.5% and yep - the cost is based on the 4.6% of gas. ^1 https://grid.iamkate.com/ https://grid.iamkate.com/

konschubert 6mo ago
In Germany, the price for the 17:00 product today is about 11 Euro, which is NOT the price implied by gas. No gas plant can run at this price.
pjc50 6mo ago
The price of gas is −£9.26/MWh? (from that link!)
- tialaramex 6mo ago
  Exactly. That's clearly not a price dictated by gas. That's an example where CCGT generators were willing to pay you to take away their electricity. Obviously the gas they bought to do this cost money and so they're making a small loss when this happens and it would be good to understand why and how this makes sense for them in order to develop policies which get us the outcomes we want.
  - ikr678 6mo ago
    The how and why is that gas takes up space, cutting usage to zero when your site storage is full can cause issues (you can do this short term and get a bit of line pack going but it all eventually has to go somewhere). I think gas turbines can turn off completely without issue (unlike coal) but there may also be situations where it costs more money to restart the generation process completely than to idle it at low capacity for a few hours when there is no demand for gas generation.
  - CraigRood 6mo ago
    I'm far from an expert here but isn't that spot price rather than future deliveries? Few people pay for actual spot pricing because it can go the other way, and you want known pricing. You would have a forward contract to delivery gas at say 20p. This is a known price for operation and likely has profit baked in anyway. The excess is what we see now. They can't just switch off as they have a contract to fulfill, but the grid doesn't need the excess, therefore priced at a negative.
    - tialaramex 6mo ago
      In https://commonslibrary.parliament.uk/research-briefings/cbp-9768/ https://commonslibrary.parliament.uk/research-briefings/cbp-... under "Why does the price of gas drive electricity prices?" it suggests that, at the time the CMA report linked was written (now over 10 years ago) the CMA thought as much as 40% of electricity is traded at spot prices. Now, the CMA report that's linking is talking about a world we no longer live in, in that world the UK burns coal, Russia hasn't invaded Ukraine and so on, and thus the numbers might be entirely different now, but that's the best I could find.

konschubert 6mo ago

In Germany, the price for the 17:00 product today is about 11 Euro, which is NOT the price implied by gas. No gas plant can run at this price.

pjc50 6mo ago

The price of gas is −£9.26/MWh? (from that link!)

tialaramex 6mo ago
Exactly. That's clearly not a price dictated by gas. That's an example where CCGT generators were willing to pay you to take away their electricity. Obviously the gas they bought to do this cost money and so they're making a small loss when this happens and it would be good to understand why and how this makes sense for them in order to develop policies which get us the outcomes we want.
- ikr678 6mo ago
  The how and why is that gas takes up space, cutting usage to zero when your site storage is full can cause issues (you can do this short term and get a bit of line pack going but it all eventually has to go somewhere). I think gas turbines can turn off completely without issue (unlike coal) but there may also be situations where it costs more money to restart the generation process completely than to idle it at low capacity for a few hours when there is no demand for gas generation.
- CraigRood 6mo ago
  I'm far from an expert here but isn't that spot price rather than future deliveries? Few people pay for actual spot pricing because it can go the other way, and you want known pricing. You would have a forward contract to delivery gas at say 20p. This is a known price for operation and likely has profit baked in anyway. The excess is what we see now. They can't just switch off as they have a contract to fulfill, but the grid doesn't need the excess, therefore priced at a negative.
  - tialaramex 6mo ago
    In https://commonslibrary.parliament.uk/research-briefings/cbp-9768/ https://commonslibrary.parliament.uk/research-briefings/cbp-... under "Why does the price of gas drive electricity prices?" it suggests that, at the time the CMA report linked was written (now over 10 years ago) the CMA thought as much as 40% of electricity is traded at spot prices. Now, the CMA report that's linking is talking about a world we no longer live in, in that world the UK burns coal, Russia hasn't invaded Ukraine and so on, and thus the numbers might be entirely different now, but that's the best I could find.