• @Ryantific_theory
    link
    111 year ago

    Okay, this was more of a read than anticipated. Turns out there are a few systems that can allow negative pricing, at least one in Australia and one in Europe. It has to do with the European electricity exchange bidding process, by which wholesale customers place bids for power usage at specific points in time, which allows power generation to be balanced for usage and stability on both production and consumption sides (without integrated storage, all the energy generated needs to go somewhere). It lets large scale consumers reschedule their consumption to take advantage of when prices are low, and lets producers spin down production when demand is low.

    What happens when it turns negative is there’s a sudden increase in production, usually due to solar or wind, sometimes flooding affecting hydroelectric, and the production of electricity is much higher than anticipated. Conventional power stations (especially coal) can take hours to restart after shutting down while costing significant sums of money, so it winds up being cheaper and safer for grid stability to keep less flexible power plants burning and reduce prices until wholesale customers are consuming the extra supply. Which can wind up meaning they’re outright paying people to use electricity.

    In addition, Germany will export electricity to their neighbours to stabilize the grid. Ironically, according to the source I found (below), consumers actually wind up paying as part of the renewable energy surcharge that seems to guarantee that renewable energy is purchased at a steady rate regardless of electricity prices. Kind of a weird system, but it incentivizes building out renewable power and maintaining grid stability. Elon may be a tool, but adding battery storage into grids to slurp up excess supply and dispense it when needed is something that is exceedingly useful in getting the most out of renewable generation.

    spoiler

    https://www.cleanenergywire.org/factsheets/why-power-prices-turn-negative