Markets in Power(bam.kalzumeus.com)
bam.kalzumeus.com
Markets in Power
https://bam.kalzumeus.com/archive/markets-in-power/
24 comments
I am looking forward to seeing if Etherium has less correlation with Bitcoin after changing to proof-of-stake. The price of Etherium and Bitcoin were highly correlated, and was that partially due to production costs (power) or just market sector investments (large inflows or outflows to/from the crypto market in general).
Yeah, I was really impressed with that paragraph. He's being kind of unfair to bitcoin, but put in context, that description is spot on.
People get a little bit hysterical about demand response.
It's just a cheap and sensible thing to do. But since fossil fuel interests need to create that continuing narrative of chaos and collapse, doing the cheap and sensible thing is treated like one of the four horsemen of the apocalypse.
The rest of the article touches on why the peakiest peaks are expensive. But still, sending a text message to offer a financial incentive to do something trivial to help avoid an inefficient waste of resources, is a sign that civilization is on the verge of collapse, rather than a boring cost optimisation.
It's just a cheap and sensible thing to do. But since fossil fuel interests need to create that continuing narrative of chaos and collapse, doing the cheap and sensible thing is treated like one of the four horsemen of the apocalypse.
The rest of the article touches on why the peakiest peaks are expensive. But still, sending a text message to offer a financial incentive to do something trivial to help avoid an inefficient waste of resources, is a sign that civilization is on the verge of collapse, rather than a boring cost optimisation.
There are a lot of different things under the demand response umbrella. I agree that text messaging with an incentive is a no brainer. So are commercial and industrial DR programs. But at the far end of the spectrum, where it starts being more automated and more opaque and confusing to residential power customers, I think it's less clear cut.
> sending a text message to offer a financial incentive to do something trivial to help avoid an inefficient waste of resources
It might not be trivial. As the article notes, the main thing that ends up needing to be "shifted" (a misnomer, as we'll see in a moment) is residential air conditioning. But you can't "shift" air conditioning. What "shifting" actually means here is "leaving your A/C off and letting your house warm up". Some people can withstand that without much problem; but some can't (for a variety of reasons). For the ones that can't, running their A/C is not "an inefficient waste of resources", it's a necessity.
It might not be trivial. As the article notes, the main thing that ends up needing to be "shifted" (a misnomer, as we'll see in a moment) is residential air conditioning. But you can't "shift" air conditioning. What "shifting" actually means here is "leaving your A/C off and letting your house warm up". Some people can withstand that without much problem; but some can't (for a variety of reasons). For the ones that can't, running their A/C is not "an inefficient waste of resources", it's a necessity.
There's a lot of stats and utilizing personalized information that go into this.
I was part of https://www.oracle.com/industries/utilities/products/opower-... before the oracle acquisition, and we powered the Demand Response program, in addition to other things.
There's a couple steps to this:
I was part of https://www.oracle.com/industries/utilities/products/opower-... before the oracle acquisition, and we powered the Demand Response program, in addition to other things.
There's a couple steps to this:
1. Eligibility and Program Opt-outs (figure out who it is legal to send the message to)
2. Machine Learning to predict the ROI - how much to offer and how many people are likely to "advertise" to - the utility needs to know so they can keep within budget.
3. What effective, A/B tested messaging to send (some people care about money back, some cared about being green, some both)
4. What medium the customer reacted to (we did batch, usps snail mail - generate PDFs and automated the mailing while minimizing postage cost, or did they react to SMS)
5. The actual platform to blast out texts to all residential customers 24hrs before the DR (Demand Response) event to a city - ex: (BGE) boston, tokyo, PGE (bay area)..
You can shift air conditioning, to a degree. You could cool down the house, maybe even one or two degrees under your usual temperature. Your house now acts as a thermal battery and you can leave the AC off for some time. How long will that work? With the general atrocious insulation in Japan and the very humid/hot summers, probably not super long.
Of course not super on topic but the insulation in central Japan seems to be a big problem to me. Walls are thin and often made out of wood. There are ventilaton holes, often closeable, but with the thinnest plastic cover. Windows are single pane, and the window frames and doors are often of such shoddy construction, you can see the outside through some cracks. If there was a shift in construction quality, I'm sure the electricity use in summer and winter would drop, but I don't expect that to happen soon. Insulation and construction quality is expensive, so this isn't done in construction of rental apartments.
Of course not super on topic but the insulation in central Japan seems to be a big problem to me. Walls are thin and often made out of wood. There are ventilaton holes, often closeable, but with the thinnest plastic cover. Windows are single pane, and the window frames and doors are often of such shoddy construction, you can see the outside through some cracks. If there was a shift in construction quality, I'm sure the electricity use in summer and winter would drop, but I don't expect that to happen soon. Insulation and construction quality is expensive, so this isn't done in construction of rental apartments.
> How long will that work?
Not very long in any house, if the day is sunny. If the day is cloudy, you might squeeze some more time out. The main heat load on a house in the summer is the sun.
Not very long in any house, if the day is sunny. If the day is cloudy, you might squeeze some more time out. The main heat load on a house in the summer is the sun.
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The inefficient waste of resources being discussed wasn't on the demand side, but rather on the generating side. It would be far better to shed the load, instead of firing up less efficient (i.e. wasteful) peaker units.
Such an insightful article.
I'm really curious how one acquires the knowledge and develops the skills needed to write so eloquently about a deeply complicated topic. What does patio11 read, who are the people he interacts with, what helped him nurture his exploratory traits, how does he structure new knowledge. It's all a fascinating mystery to me.
I'm really curious how one acquires the knowledge and develops the skills needed to write so eloquently about a deeply complicated topic. What does patio11 read, who are the people he interacts with, what helped him nurture his exploratory traits, how does he structure new knowledge. It's all a fascinating mystery to me.
The writing ability is partially reading a lot and more writing a lot; I'm at at least ~3.5 million published words and probably another 1.5 million or so behind various firewalls. This is a lot more reps than most people, including most professional writers (somewhat surprisingly), get on writing.
With regards to being able to learn about things, historically I've been weighted more towards "I read more on the Internet than almost anyone thinks is reasonable", but my job and market position have brought me into contact with people who are domain experts at various things, and when I'm planning to write about e.g. power generation I share initial thoughts with someone quite professionally familiar with that topic in Japan and e.g. they point me in the direction of virtual power plants as another subject to read about / include.
From my point of view on things, my worry is erring in the direction of too explainer-y and too "smart generalist who overrates his understanding of things that he's got ~hours of time invested in." I aspire to routinely delight people who are legitimate experts adjacent to the areas I'm covering and help non-expert professionals quickly get the right set of mental models to inform their own work.
With regards to being able to learn about things, historically I've been weighted more towards "I read more on the Internet than almost anyone thinks is reasonable", but my job and market position have brought me into contact with people who are domain experts at various things, and when I'm planning to write about e.g. power generation I share initial thoughts with someone quite professionally familiar with that topic in Japan and e.g. they point me in the direction of virtual power plants as another subject to read about / include.
From my point of view on things, my worry is erring in the direction of too explainer-y and too "smart generalist who overrates his understanding of things that he's got ~hours of time invested in." I aspire to routinely delight people who are legitimate experts adjacent to the areas I'm covering and help non-expert professionals quickly get the right set of mental models to inform their own work.
I suspect he is giving you a hint in the first paragraph of the article:
> ...Europe generally (being fundamentally unserious about power policy)...
What makes this article unusual is it is a serious attempt at grappling with a political topic - asking what the underlying pressures and technical requirements might be. That makes it read very differently to a lot of 'debates' where neither side is treating the topic seriously (whether that is not painting the full picture, repeating talking points, direct lies and people stopping to talk about lies, motivated or sloppy reasoning, illogical arguments, a refusal to engage with huge differences in order of magnitude, etc).
If you write a lot of short-form comments (Twitter, HN, corporate media or reddit for example - anything that promotes slogans or soundbites) you probably won't learn to write like this in a million years, because they aren't environments that promote seriously dealing with topics. HN can just about manage to talk seriously on the subject programming/software, but it often has a weird disjointed style where the thought is spread across multiple comments with different authors.
> ...Europe generally (being fundamentally unserious about power policy)...
What makes this article unusual is it is a serious attempt at grappling with a political topic - asking what the underlying pressures and technical requirements might be. That makes it read very differently to a lot of 'debates' where neither side is treating the topic seriously (whether that is not painting the full picture, repeating talking points, direct lies and people stopping to talk about lies, motivated or sloppy reasoning, illogical arguments, a refusal to engage with huge differences in order of magnitude, etc).
If you write a lot of short-form comments (Twitter, HN, corporate media or reddit for example - anything that promotes slogans or soundbites) you probably won't learn to write like this in a million years, because they aren't environments that promote seriously dealing with topics. HN can just about manage to talk seriously on the subject programming/software, but it often has a weird disjointed style where the thought is spread across multiple comments with different authors.
It’s probably less who he reads, than how much he writes, and on top of that who reads him. By the latter I mean partially that he likely gets good feedback, but moreso that if you know your audience, have generally been rewarded for writing for them, and have a credible belief they’ll read the next thing, you’re going to aim high and be serious about self-criticism & improvement.
I’m sure he reads and writes a lot—out of a love of language. Keen attention to detail and a sense of personal style…for instance his use of ‘make due’ instead if ‘make do’. That’s like wearing an ascot and sport coat where everyone else is wearing a boring fleece.
This article was fascinating -
At least in large part due to patio11’s entertaining style.
I have always wondered how it’s possible to have such regular power, when it seems like such a challenging problem to solve.
Lastly…if you ever get a chance to support nuclear power in your community, please do. it’s safe.
I have always wondered how it’s possible to have such regular power, when it seems like such a challenging problem to solve.
Lastly…if you ever get a chance to support nuclear power in your community, please do. it’s safe.
It's not really fair for us to build Nuclear, but not allow other countries to build it.
If we can't trust some leaders with it, then I don't see why we would trust any democratic country with it. As we have seen in the US, the mob can elect literally anybody.
If we can't trust some leaders with it, then I don't see why we would trust any democratic country with it. As we have seen in the US, the mob can elect literally anybody.
I don't think nuclear's problem is safety. If it was cheap it would be built anyway. Do you think most people think the thick, black plumes of smoke coming out of a coal plant are safe? No, but at the time coal was cheap power and we build a lot of coal plants.
Nuclear power has at least three problems:
- It has historically been associated with nuclear weaponry, giving it an unsafe imago. Chernobyl and related incidents didn't help, and remediation of nuclear incidents is much more difficult than something like the aftermath of a coal pile fire.
- It was not really cheaper than fossil fuels for much of its life, and it is not cheaper than renewables now.
- Not many countries have the capability to build nuclear power plants, which means they need assistance from abroad. This creates unwanted dependencies. As a simple example, I bet Finland is not very happy about its Russian-built nuclear power plants right now.
- It has historically been associated with nuclear weaponry, giving it an unsafe imago. Chernobyl and related incidents didn't help, and remediation of nuclear incidents is much more difficult than something like the aftermath of a coal pile fire.
- It was not really cheaper than fossil fuels for much of its life, and it is not cheaper than renewables now.
- Not many countries have the capability to build nuclear power plants, which means they need assistance from abroad. This creates unwanted dependencies. As a simple example, I bet Finland is not very happy about its Russian-built nuclear power plants right now.
there's also the political side of things:
- countries having nuclear not wanting developing countries to have nuclear energy that act as a gateway to developing nuclear weapons over time.(I think this was the case for iran, not sure)
- in case of conflicts/wars a nuclear site blowing up is a much bigger deal than a coal plant or wind farm blowing up.
renewable energy doesn't have these problems.
- countries having nuclear not wanting developing countries to have nuclear energy that act as a gateway to developing nuclear weapons over time.(I think this was the case for iran, not sure)
- in case of conflicts/wars a nuclear site blowing up is a much bigger deal than a coal plant or wind farm blowing up.
renewable energy doesn't have these problems.
Great read. This had distinct "Connections" series vibes.
Seems like an unnecessary convoluted system to regulate demand. Why not simply leave kWh prices fluctuate during the day? Smart meters would adjust consumption accordingly.
You can use your smart meter to kick-off powering some things, like charging your car, heating the house, AC, etc, only below a certain price level.
If enough users do the same, the operator of the network can adjust dynamically the load of the grid by simply increasing/decreasing prices.
You can use your smart meter to kick-off powering some things, like charging your car, heating the house, AC, etc, only below a certain price level.
If enough users do the same, the operator of the network can adjust dynamically the load of the grid by simply increasing/decreasing prices.
> Bitcoin miners are in the business of bidding electronics depreciation and electricity consumption against each other to win a tournament in generating random numbers with mystical properties. From this tournament arises a mediocre transaction processing network and a speculative asset. You get more of the speculative asset if you’re the global highest bidder in electricity used in generating random numbers and, hence, the huge overlap in professional Bitcoin miners and people with deep expertise in quirks of the power generation market.