[fuoqi]

1) Introduce a lot of intermittent generation into energy grid without sufficient amount of storage capacity.

2) Use marginal pricing model which effectively guarantees windfall profits for those sources.

3) Utilization of peaking power plants falls, but you still have to keep them because there is not enough storage capacity.

4) Peaking power plants rise generation costs to offset the lower utilization, further adding to the windfall profits.

5) You need more grid capacity to handle energy transfers from distributed generation sources.

5) ????

6) Act surprised when people loudly complain about electricity bills despite abundant "cheap" generation.

Intermittency of generation is an externality (same as CO2 emissions) and should be priced accordingly. People are willing to pay premium for supply stability, but the current pricing model does no account for that. Trying to change consumption habits (like smart grids, dynamic pricing, etc.) works poorly, especially for such vital resource as electricity.

I think there should be some kind of price penalty for intermittent sources dependent on total ratio of intermittent generation in the mix. At least until grid-scale energy storage technology will be advanced enough to store approximately week of total energy consumption.

[amiga386]

For 5, add in that the new grid capacity is years behind schedule, and the existing grid capacity needs to come offline because it's decrepit, and you also have a policy to connect new sources immediately

It leads to a lot of telling new sources to dump their energy, and paying them to dump their energy, while simultaneously paying old gas generators (nearer the demand) to fire up. All for the want of more grid capacity.

https://ukerc.ac.uk/news/transmission-network-unavailability...

[nothrabannosir]

> Trying to change consumption habits (like smart grids, dynamic pricing, etc.) works poorly, especially for such vital resource as electricity.

Why? Has the UK started trying recently? When I lived there nobody gave a hoot about fluctuating prices. It would have been hard to even know when electricity was expensive or not. Has it changed?

Meanwhile >three decades ago my grandparents in rural France had a big red lamp on the kitchen wall that would light up when energy was expensive. It was a part of their life and they had no problem with it. They chose that plan deliberately because it ended up cheaper.

If you’re saying that even with adaptive behavior , it’s all a wash because the constant cost of peakers is so high that you lose all savings when they kick in , no matter how little you use; ok, I believe you did the math.

But if the claim is “it’s impossible for humans to adapt their energy consumption depending on the current price of electricity”, I have seen first hand that is not true. For sure when I lived in Britain nobody did this at all, but that would be at best a British limitation, not a human one.

[Symbiote]

I've never seen a red light, but the UK has had multiple electricity rates for households since the 1980s.

https://en.wikipedia.org/wiki/Economy_7

My parents would set timers on the dishwasher, washing machine etc too run at night.

[ascorbic]

All EV chargers sold in the UK are now smart, and adjust charging schedule according to price.

[tialaramex]

The vast majority of UK consumers have a pretty simple plan where they're not demand responsive. If it's pitch black and dead calm one Winter's night they pay the exact same price as midday in the summer if it's blazing sunshine and simultaneously blowing a gale across the whole country. Their retailler has done some estimates and figured on average they can sell power for, say, 25p per kWh all day, every day. Some days they're raking it in 'cos they paid a lot less than that, other days they wish the day would end, but if their team did the sums right it comes out profitable at year end.

There are people, especially people with EVs and who can do that sort of "turn on a dime" lifestyle where you do laundry when it's cheaper not because it's Thursday who pay 0p per kWh some hours and 45p per kWh for that bleak winter's night.

For now that second group are a minority but they do exist.

The enabling technology is a bit more sophisticated than your French red lamp. "Smart" meters relay your usage constantly so you can be charged in 30 minute chunks, the same way the wholesale electricity market works. This also means you can see at a glance what's going on. So that's nice. The usual conspiracy people insist this is a future tool of control by government, just like almost everything that has ever been invented, bar codes on groceries, mobile phones, newspapers, parking tickets, everything.

[fuoqi]

This does not work at scale. Sure, there is plenty of anecdotes how you can successfully play this game as a consumer living in a rural house with electric car, power wall, and rooftop solar, but try to telling about it to someone living in a high-rise apartment or to a heavy industry business. Your preaching will fall on deaf ears.

IIRC there are several utilities in the UK which provide option to price electricity dynamically, but they are not popular because people do not want to play this game. They want reliable supply of electricity for reasonable prices. Trying to mold consumption to satisfy intermittency of generation is nothing more than shifting the externality akin to telling people "you must plant trees to offset CO2 emissions!".

[bryanlarsen]

This is addressed by the capacity market mechanism.

[jakewins]

Intermittency is already handled by the price mechanisms, they are set quarter-hourly; if you’re not available when there is high demand you don’t get paid.

The marginal price windfalls happen specifically when you’re able to deliver at a low cost when demand is high in the same ISP.

This just seems like data-free fear mongering.

[youngtaff]

Do you understand how the CFDs for these wind farms work?

When the wholesale prices is about the CFD strike price then the excess funds are paid to the Low Carbon Company and used to reduce electricity bills

Storage capacity is being build out - it's one of the prime uses of old power station sites (because they already have grid connectivity)

Grid capacity is being built out e.g. the Eastern Green links to allow transfer of power from Scotland to England and reduce curtailment payments