Emeritus Prof Christopher MayDec 12

As Dale Vince (Ecotricity) points out, all that is required to reduce energy prices (specifically electricity) in the UK is to remove the requirement from the auction system that the price is dictated by the highest bid (nearly always that made by gas).

Breaking the link with gas prices (and allowing each energy source to be supplied at its actual bid price) would immediately reduce energy prices across the country.

Moreover the Govt. has the power to do this, they just don't!

#energy
h/t FT

Show threadRachel LawsonDec 12
@ChrisMayLA6 we currently need “spinning” generators, like gas and nuclear, to provide stability to the frequency of the grid. We don’t get that from solar etc atm. So, we have tonnage sure the gas generators stay in business.
There is already grid work taking place to enable solar etc to be able to provide this frequency stability. Once it is done, we won’t need the gas and we don’t need to support them any more.
Show threadMarjorieRDec 12
@rachel @ChrisMayLA6 at present we already pay gas, and previously coal, generators to be there to run idle, it's called the Capacity mechanism.
And if we followed Ecotricity's suggestion those generators would still get their bid price, just everyone would get their bid price, not what the gas generators, as the most expensive bidder gets.
In my view what each type of generator should get should be determined by their long term cost of supply, which surely is set through their Contract for Difference price, not the cost of the marginal supplier on the day.
Show threadThe Penguin of Evil
@marjolica @rachel @ChrisMayLA6 Not sure I understand how much of a difference this would make. Isn't the government already taking back the excess behind the scenes via the windfall taxes against renewables ? That would have to stop.
Dec 12 at 11:26amMastodon for Android
Show threadMarjorieRDec 12
@etchedpixels @rachel @ChrisMayLA6 to be honest I find the accounting for Contracts for Difference entirely confusing and similarly for windfall taxes on renewables.
My POV is that it would be better if the excess profits made because cheaper suppliers are paid the same price as gas weren't made in the first place and the monies instead of being diverted to the Treasury were reflected in a lower electricity price.
Back in the day, pre-Thatcher, we had a nationalised Central Electricity Generating Board (CEGB) (and National Grid) and the CEGB owned all the power stations and was only tasked with breaking even not making a profit. Power stations where then brought on line using a 'merit order', reflecting availability, fuel prices, efficiency and location.
Maybe it's time we renationalised?