30 ms·

If what you say is true, then with better economies of scale and longer investment horizons, utilities would quickly erase any peak-vs-non-peak arbitrage opport

by kmod 11y ago

If what you say is true, then with better economies of scale and longer investment horizons, utilities would quickly erase any peak-vs-non-peak arbitrage opportunities.

epistasis 11y ago
Different entities have different risk profiles, and utilities are extremely conservative. It will probably be profitable to load shift for several years before utilities start to do it on their own. And even then, it may take quite some time before there's enough battery capacity for all the fluctuations to even out.
- gutnor 11y ago
  Utilities with electricity production are more conservative because they have technical limitation due to the infrastructure they run. However, there is a bunch of companies that buy and sell electricity on the open market, so they have a direct financial interest to play with this arbitrage. In the UK, another reader has calculated the best case scenario was profitability in about 10 years. (his numbers ring true to me, I calculated recently that there was no reason to take an economy 7 contract for my electricity usage using similar data) That's a lot of time even in the utility market. So if batteries not attached to solar panel are going to be profitable (in the UK), that would be a future generation.
toomuchtodo 11y ago
> utilities would quickly erase any peak-vs-non-peak arbitrage opportunities. Probably right around the same time they're no longer necessary, as the cost of distribute solar continues to plummet. Its actually truly amazing how quickly the price continues to drop for panels each year.
- eru 11y ago
  Depends on country. I doubt you could ever run, say, Germany or Britain on locally produced solar power.
  - maccam94 11y ago
    Relevant: http://en.wikipedia.org/wiki/Renewable_energy_in_Germany http://en.wikipedia.org/wiki/Renewable_energy_in_Germany
  - matt4077 11y ago
    There also wind... But solar already provides quite a substantial contribution in Germany. See this live chart: https://www.energy-charts.de/power.htm https://www.energy-charts.de/power.htm. Considering the rate at which solar power is getting cheaper, I'd say a solar power based economy is within reach.
    - kamikrazy 11y ago
      Great link. It's also amazing how Solar power generation falls significantly in the winter months. For instance, December output is less than 10% of June! Chart here: Check out monthly/weekly energy production for 2014 https://www.energy-charts.de/energy.htm https://www.energy-charts.de/energy.htm
    - eru 11y ago
      Sure, wind, geothermal, nuclear etc.
  - toomuchtodo 11y ago
    But you could run it on a combination of onshore wind, offshore wind, distributed solar, utility solar, and energy storage (ie Tesla's Utility Storage solution).
colinsidoti 11y ago
It's hard to wrap your head around all the challenges in energy. If you're REALLY good at it you can find some incredible arbitrage opportunities...see Enron. Consider the power output characteristics of some common energy sources: Gas, Nuclear, Hydro, Wind, Solar Our "sustainable" sources of power - hydro, wind, and solar - are also the ones with the most irregular and unpredictable power output. This creates a problem, because even if there was enough cumulative power output from sustainable sources today, it most likely wouldn't align with our usage schedule. So there are two solutions: 1) find a way to map the sustainable power output to our usage 2) find a way to store energy Today, our most readily available form of energy storage is gas. We just put it in a container and burn it when we need to. "Spin it up," if you will. An alternative to gas is a crazy network of Powerwalls. The hope is that, eventually, instead of spinning up gas turbines during peak demand, we can just draw from our Powerwall. There was another alternative on HN recently. Basically a super-deep hole in the ground with super heavy object falling into it, but suspended by a rope. You run a motor to lift the object during off-peak hours, then let it fall and spin a generator during peak hours. I can't find it right now but I remember thinking they had a great name. --- That said, power output is only part of the problem. If you're looking to factor the potential disappearance of arbitrage opportunities into your buying decision, you also need to consider the time until regulatory changes allow for perfect pricing, and the time until these Powerwalls have precise enough information to decide exactly when to draw from the grid versus the battery. tl;dr: "quickly" is probably optimistic. We're a long ways away from economies of scale.
- jimmcslim 11y ago
  > There was another alternative on HN recently. Basically a super-deep hole in the ground with super heavy object falling into it, but suspended by a rope. Or a train going up and down a hill... http://www.aresnorthamerica.com/ http://www.aresnorthamerica.com/ Both are basically the same concept as pumped hydro which has been in use for a long time... pump water up a hill when energy is cheap, let it fall down and turn a turbine when energy is expensive. And hey, if it rains, free energy! The rail/hole in the ground approach have the advantage of taking up less land I suppose, but I suspect are less efficient.
- TheLoneWolfling 11y ago

by kmod 11y ago

If what you say is true, then with better economies of scale and longer investment horizons, utilities would quickly erase any peak-vs-non-peak arbitrage opportunities.

epistasis 11y ago

Different entities have different risk profiles, and utilities are extremely conservative. It will probably be profitable to load shift for several years before utilities start to do it on their own. And even then, it may take quite some time before there's enough battery capacity for all the fluctuations to even out.

gutnor 11y ago
Utilities with electricity production are more conservative because they have technical limitation due to the infrastructure they run. However, there is a bunch of companies that buy and sell electricity on the open market, so they have a direct financial interest to play with this arbitrage. In the UK, another reader has calculated the best case scenario was profitability in about 10 years. (his numbers ring true to me, I calculated recently that there was no reason to take an economy 7 contract for my electricity usage using similar data) That's a lot of time even in the utility market. So if batteries not attached to solar panel are going to be profitable (in the UK), that would be a future generation.

toomuchtodo 11y ago

> utilities would quickly erase any peak-vs-non-peak arbitrage opportunities. Probably right around the same time they're no longer necessary, as the cost of distribute solar continues to plummet. Its actually truly amazing how quickly the price continues to drop for panels each year.

eru 11y ago
Depends on country. I doubt you could ever run, say, Germany or Britain on locally produced solar power.
- maccam94 11y ago
  Relevant: http://en.wikipedia.org/wiki/Renewable_energy_in_Germany http://en.wikipedia.org/wiki/Renewable_energy_in_Germany
- matt4077 11y ago
  There also wind... But solar already provides quite a substantial contribution in Germany. See this live chart: https://www.energy-charts.de/power.htm https://www.energy-charts.de/power.htm. Considering the rate at which solar power is getting cheaper, I'd say a solar power based economy is within reach.
  - kamikrazy 11y ago
    Great link. It's also amazing how Solar power generation falls significantly in the winter months. For instance, December output is less than 10% of June! Chart here: Check out monthly/weekly energy production for 2014 https://www.energy-charts.de/energy.htm https://www.energy-charts.de/energy.htm
  - eru 11y ago
    Sure, wind, geothermal, nuclear etc.
- toomuchtodo 11y ago
  But you could run it on a combination of onshore wind, offshore wind, distributed solar, utility solar, and energy storage (ie Tesla's Utility Storage solution).

colinsidoti 11y ago

It's hard to wrap your head around all the challenges in energy. If you're REALLY good at it you can find some incredible arbitrage opportunities...see Enron. Consider the power output characteristics of some common energy sources: Gas, Nuclear, Hydro, Wind, Solar Our "sustainable" sources of power - hydro, wind, and solar - are also the ones with the most irregular and unpredictable power output. This creates a problem, because even if there was enough cumulative power output from sustainable sources today, it most likely wouldn't align with our usage schedule. So there are two solutions: 1) find a way to map the sustainable power output to our usage 2) find a way to store energy Today, our most readily available form of energy storage is gas. We just put it in a container and burn it when we need to. "Spin it up," if you will. An alternative to gas is a crazy network of Powerwalls. The hope is that, eventually, instead of spinning up gas turbines during peak demand, we can just draw from our Powerwall. There was another alternative on HN recently. Basically a super-deep hole in the ground with super heavy object falling into it, but suspended by a rope. You run a motor to lift the object during off-peak hours, then let it fall and spin a generator during peak hours. I can't find it right now but I remember thinking they had a great name. --- That said, power output is only part of the problem. If you're looking to factor the potential disappearance of arbitrage opportunities into your buying decision, you also need to consider the time until regulatory changes allow for perfect pricing, and the time until these Powerwalls have precise enough information to decide exactly when to draw from the grid versus the battery. tl;dr: "quickly" is probably optimistic. We're a long ways away from economies of scale.

jimmcslim 11y ago
> There was another alternative on HN recently. Basically a super-deep hole in the ground with super heavy object falling into it, but suspended by a rope. Or a train going up and down a hill... http://www.aresnorthamerica.com/ http://www.aresnorthamerica.com/ Both are basically the same concept as pumped hydro which has been in use for a long time... pump water up a hill when energy is cheap, let it fall down and turn a turbine when energy is expensive. And hey, if it rains, free energy! The rail/hole in the ground approach have the advantage of taking up less land I suppose, but I suspect are less efficient.
TheLoneWolfling 11y ago