An important reason that power is expensive in the UK is that it doesn't use zonal pricing and is effectively not giving the right price signals to consumers of power to move closer to where the cheap power is (e.g. data centers) or to conserve power when power is expensive; or producers of power to invest in power generation closer to where the power is scarce and expensive.
Another point to make is that the national wholesale price of power in the UK is based on the price of the most expensive thing in the market at any point. Which now that they shut down coal is usually gas which at this point the UK mostly imports because gas production in the North Sea fields has been petering out. It no longer is the cheap resource it once was.
Even Scotland which either exports or curtails dirt cheap wind power most of the time gets to pay expensive gas rates for their power. Why is power curtailment a thing there? Because there is no price incentive to use the power. Otherwise people might be doing sane things like charging their EVs, powering their heat pumps, etc. Instead Scotland imports gas for heating and petrol for driving their cars. At the same time they curtail wind power by the GW.
Greg Jackson from Octopus (who are the largest energy operator in the UK) has been calling for this for some time. I don't live there but his name comes up a lot in several of the clean energy podcasts I follow. Smart person that has a lot of sensible things to say on this topic.
> The UK has achieved the fastest rate of grid decarbonisation among advanced economies. A lot of this progress occurred when renewables were still expensive, so we are stuck with a cost hangover. Luckily, renewables are getting much cheaper, so the tradeoffs in future policy are very different.
A silver lining at least. I’m old, so won’t see the benefits of this I’m sure, but it’s still nice to know we’ve made some tangible progress toward a cleaner future
Im old enough to remember when Prof. Ian Fells [1] discussed most of these problems in the early 1980s in the UK. Our “time from problem identification to solution deployed” is absolutely abysmal in the UK.
The graph shows the price for 3100 kWh. I'm not sure if that is a very low annual amount or a very very high monthly amount.
The average US household uses 10,000 kWh annually ~833 kWh per month. So I'm guessing most Americans reading the article and looking at the interactive graph are thinking either: this is very cheap or very expensive, depending on whether they are assuming it's monthly or annual.
In the US the average price for 3100 kWh in California would be $1062 which is among the highest in the continental US. So right in line with GB.
In New York it would be $710. Florida it would be $454.
So it's high, but not as eye-watering as it seemed to me initially.
jillesvangurp ·22 hours ago
Another point to make is that the national wholesale price of power in the UK is based on the price of the most expensive thing in the market at any point. Which now that they shut down coal is usually gas which at this point the UK mostly imports because gas production in the North Sea fields has been petering out. It no longer is the cheap resource it once was.
Even Scotland which either exports or curtails dirt cheap wind power most of the time gets to pay expensive gas rates for their power. Why is power curtailment a thing there? Because there is no price incentive to use the power. Otherwise people might be doing sane things like charging their EVs, powering their heat pumps, etc. Instead Scotland imports gas for heating and petrol for driving their cars. At the same time they curtail wind power by the GW.
Greg Jackson from Octopus (who are the largest energy operator in the UK) has been calling for this for some time. I don't live there but his name comes up a lot in several of the clean energy podcasts I follow. Smart person that has a lot of sensible things to say on this topic.
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louthy ·23 hours ago
A silver lining at least. I’m old, so won’t see the benefits of this I’m sure, but it’s still nice to know we’ve made some tangible progress toward a cleaner future
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nickdothutton ·1 hours ago
[1] https://en.wikipedia.org/wiki/Ian_Fells
stonesthrowaway ·44 minutes ago
graybeardhacker ·23 hours ago
The average US household uses 10,000 kWh annually ~833 kWh per month. So I'm guessing most Americans reading the article and looking at the interactive graph are thinking either: this is very cheap or very expensive, depending on whether they are assuming it's monthly or annual.
In the US the average price for 3100 kWh in California would be $1062 which is among the highest in the continental US. So right in line with GB.
In New York it would be $710. Florida it would be $454.
So it's high, but not as eye-watering as it seemed to me initially.
Show replies