Posted on 09/20/2015 10:59:50 PM PDT by blam
Daniel Gross
September 21, 2015
In the wee hours of the morning on Sunday, the mighty state of Texas was asleep.
The honky-tonks in Austin were shuttered, the air-conditioned office towers of Houston were powered down, and the wind whistled through the dogwood trees and live oaks on the gracious lawns of Preston Hollow.
Out in the desolate flats of West Texas, the same wind was turning hundreds of wind turbines, producing tons of electricity at a time when comparatively little supply was needed.
And then a very strange thing happened: The so-called spot price of electricity in Texas fell toward zero, hit zero, and then went negative for several hours. As the Lone Star State slumbered, power producers were paying the state’s electricity system to take electricity off their hands. At one point, the negative price was $8.52 per megawatt hour.
Impossible, most economists would say.
(snip)
(Excerpt) Read more at businessinsider.com ...
If it were impossible it wouldn’t have happened
Your tax dollars at work.
They still make money from the federal wind subsidies.
You can’t sell something for negative dollars.
Someone pays.
Guess who?
One person paid to dig a hole and bury money in it + another to dig it up = full employment
Yup.
My younger brother makes good money installing the wind turbines.
Stock up while you can!
And that means that even if wind operators give the power away or offer the system money to take it, they still receive a tax credit equal to $23 per megawatt-hour. Those tax credits have a monetary value — either to the wind-farm owner or to a third party that might want to buy them.
As a result, in periods of slack overall demand and high wind production, it makes all the economic sense in the world for wind-farm owners to offer to sell lots of power into the system at negative prices.
We use to pay people not to grow wheat. Now we pay people to produce unneeded electricity at a loss. Sheesh.
Exactly. Another market distortion brought to you by the geniuses in Washington.
Of course this “problem” could be solved by a massive energy storage system.
Take my watts, please.
Why can’t they sell excess or unwanted electricity to other states? On the East Coast, several major power companies have agreements to do that and everyone has electricity at pretty good rates.
Did former Gov. Perry know about this while he was governor? If so, maybe that is why nobody wants his a presidential candidate.
Someone from Texas please explain what is going on down there.
After reading the whole article, I see that Texas made a major mistake in NOT setting up an interstate electrical power transmission system network that could be kept on an “as needed” operational basis.
By not officially connecting to any other state’s electrical grid, Texas could remain “independent” of their system until a need would arise for them to connect to it.
It is the same as having idle but usable railroad track systems available in case of an emergency (spur lines, short-track lines, etc that can connect to the long-line if needed, or which could even bypass some long-lines).
In theory, FEMA should have asked states like Texas to create such an emergency connection/transmission system long ago, just to be safe in an area of states hard-hit by hurricanes and tornados, not to mention some powerful blizzards.
Better safe than sorry.
We need the ability to ‘bottle’ megawatts in a convenient form something like a 55 gal. drum to hold 100 KW/hr. Then we could ship them around, utilize them as is, then ship them back to be recharged.
Or Texas didn’t make a mistake.
Just saying. I’m for keeping Texas more independent, but that’s just my view.
I don’t really think it’s a mistake for Texas to keep its power grid separate from the rest of the nation; it’s a feature not a bug.
It gives Texas the ability to ramp up its electricity at a time when most states are taking coal fired systems off line, creating more demand on their systems.
To be sure, Texas is being pressured by the EPA to do the same with coal fired plants. Just the same, Sandy Creek near Waco is a 958MW coal station that came online in 2013, as an example.
I have a brilliant idea, lets spend gazillions of dollars on batteries to store that few hours of juice! We’ll make a fortune scamming the government.
Millions and millions of dollars on wind turbines that don’t add squat to the grid. A much better use would have been a new nuke or coal fired plant to generate when you need it and not on when the wind blows.
The only wind that blows is that of the blow hard in the White House.
Here's an earlier thread with info on replies 16, 28, and 32.
Also, in Texas(and CA), the price of electricity is tied to the price of natural gas. This was done back in the 90s when Texas was moving to deregulate the power industry and covert a sizable portion of Texas power from coal to natural gas.
In doing this, they had to protect the nat gas plants from rising nat gas prices, so they would tie the price of electricity to nat gas. The conventional wisdom at the time knew nothing of the advances in fracking which today has given us a surplus of natural gas and a really, really cheap price for nat gas.
Back then after Katrina the price of nat gas went thru the roof and a lot of people bet on a high price of nat gas. The biggest leveraged buy-out in US history was TXU to create Energy Future Holdings and Luminant and they are now in bankruptcy. Sarah Palin replaced Frank's pipeline with her pipeline and had to resign as Guv when the price of nat gas collapsed. Boone Pickens lost a lot of money on wind.
Tis story is very one-sided. The system has generation facilities that set idle. But the kick in the rate payers butt is that ERCOT pays the HIGHEST price. That means if a generation company is charging $50 mwh but the demand in a day in July calls for kicking in the standby generators, and the owner of a facility wants $4500 mwh, everyone in the system gets to charge that $4500 mwh.
This is why Texas now has some of the highest rates in the country since it ‘deregulated’ the system.
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