Electricity is priced wrong.
Electricity is priced wrong.
cross-posted from: https://discuss.tchncs.de/post/127188
Have you ever heard of “net metering”?
It means that if your electric company gives you net metering, you can connect a generator or solar panels to your house and sell excess electricity back to the utility at the same price that they bill you for.
Sounds great right?
No, actually its a major problem for the utility.
The reason is that power plants take a significant amount of time to throttle up or down. If everyone in the area has solar power feeding back into the power grid, sudden changes in sunlight can cause major fluctuations and destabilize the power grid.
So what is the solution?
Dynamic pricing. Some areas already do this. How it works is that the price you pay (or receive) for electricity depends on the conditions on the power grid at the moment, updating as fast as possible.
When the grid has a deficit of power at the moment (maybe a power plant is struggling to throttle up to meet demand) the price goes way up.
If the grid has a surplus power at the moment, the price goes down, even going negative.(meaning you must pay to dump your power into the grid, or be paid for consuming excess power)
What this does is create an economic incentive for people to invest in equipment that actually stabilizes and supports the power grid.
For example if you have an electric car charging in your garage, it knows the price of power, and it can start charging faster when the price drops, or it can dump its battery power back into the grid when the price is high. The battery in your car is actually earning money as it sits idle!
Same with solar panels. Even if the installation doesn’t have batteries, the system can choose to stop selling power to the grid when it isn’t wanted.
Likewise, your heated pool can choose to absorb electricity when the price is low.
This is the future of the renewable energy economy in my opinion.
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Dyamic pricing is risky: it's all sunshine and rainbows until suddenly something happens and it's $9,000/kwh.
The hardest part you'd have is convincing anyone to take the downside risks for... what, exactly?
There's no upside for the consumer here unless 'investing in more stuff for your solar panels' is in some way a useful thing.
Dumping electricity into a hole in the ground (your pool) is pretty much the LEAST green thing you can do with it.
This sounds like the consumer should spend their own money to fix the grid's inability to cope with changes and the oncoming future, rather than put the impetus on the billionaires that already own the infrastructure but aren't willing to update it.
If the price hits $9000, somethings very wrong and theres a blackout coming. In which case, having everyones electric car suddenly respond and start SELLING $9000 electricity might just stabilize the power grid and bring the price back down ASAP. Thats the point.
Correct. The whole point is having simple mechanisms at home to turn on and off energy uses depending on pricing and need. Even discharge your batteries into the grid if needed.
For those of you who thought the $9000/kwh was a random number. This actually happened for a short time in Texas after a winter storm took down most of the grid in 2021.
I'm all for dynamic pricing and other financial incentives to encourage more efficient use of power but there definitely needs to be some sort of insurance against black swan events taking peoples life savings while they try not to freeze .
The pricing should definitely have limits. I could see the rates being something like $0.05 at the lowest and and $0.50 at the highest. It would still be worth it to min/max your electricity bill but if you absolutely needed to use something at peak, you're not going to go broke over it.
The upside for the consumer, if you don’t care about reducing fossil fuel use, is that any home with a battery system will have built in uninterruptible power for the fridge, lights, grandma’s breathing machine, etc, in the event of a blackout.
Dumping energy into the pool has nothing to do with whats green, its an emergency measure in the event that the power grid has a sudden excess of energy must be dumped before power plants get damaged, which does happen.
That's an incentive for having batteries, what's the incentive for dynamic pricing?
Dynamic pricing is the mechanism that controls the distributed network. Instead of giving the utility some direct control over your equipment, your stuff monitors the price and adjusts its behaviors accordingly.
Which you have control over, if you want it to behave differently than the default settings.
My focus in the first post, though admittedly being unclear, was that this proposal is expensive.
I spent $20,000 on solar panels and all the related equipment required to make it grid-tied. I did not buy the batteries, because to provide sufficient backup power for the house I would need two of the $10,000 batteries enphase sells along with additional hardware and install costs - would have moved the $20,000 solar install to ~$45,000.
The math wasn't really in favor of more than doubling my cost, even though I'm not somewhere that does net metering: as you suggest, I'm actually paid demand pricing for any excess generation, same as any commercial plant would be.
The idea isn't bad, it's just that the expectation that the consumer of power/home owner should invest this heavily into stabilizing the grid doesn't make sense unless either the grid owners or the government are actively spending the money but even then this still feels like a solution that should be made upstream of my house since power storage at scale is going to be cheaper than expecting everyone to purchase high-capacity lithium batteries.