Posted on 02/20/2021 8:01:16 AM PST by ConservativeMind
At Griddy, transparency has always been our goal. We know you are angry and so are we. Here’s what’s been going down:
On Monday evening the Public Utility Commission of Texas (PUCT) cited its “complete authority over ERCOT” to direct that ERCOT set pricing at $9/kWh until the grid could manage the outage situation after being ravaged by the freezing winter storm.
Under ERCOT's market rules, such a pricing scenario is only enforced when available generation is about to run out (they usually leave a cushion of around 1,000 MW). This is the energy market that Griddy was designed for – one that allows consumers the ability to plan their usage based on the highs and lows of wholesale energy and shift their usage to the cheapest time periods.
However, the PUCT changed the rules on Monday.
As of today (Thursday), 99% of homes have their power restored and available generation was well above the 1,000 MW cushion. Yet, the PUCT left the directive in place and continued to force prices to $9/kWh, approximately 300x higher than the normal wholesale price. For a home that uses 2,000 kWh per month, prices at $9/kWh work out to over $640 per day in energy charges. By comparison, that same household would typically pay $2 per day.
See (below) the difference between the price set by the market's supply-and-demand conditions and the price set by the PUCT's “complete authority over ERCOT.” The PUCT used their authority to ensure a $9/kWh price for generation when the market's true supply and demand conditions called for far less. Why?
The CEO of a fellow innovative retailer shared his distress with the PUCT here. “Customers blame ERCOT, PUC, TDSPs, and retailers. The one entity that they don’t blame are the generators because they don’t have a face to the customer but they make all the money in these types of events. If you follow the money you will find that generators make all the money.”
That’s one explanation. Everyone is still trying to figure that out. But here is what we do know:
The market is supposed to set the prices, not political appointees.
And here is what we are going to do:
We intend to fight this for, and alongside, our customers for equity and accountability – to reveal why such price increases were allowed to happen as millions of Texans went without power.
More to come.
Government interfered, for some “reason.”
Nice image at the link of the problem, and below is the link to several days of “real-time pricing” across ERCOT.
Divide by 1,000 for kilowatts.
http://www.ercot.com/content/cdr/html/20210219_real_time_spp
Anyone that thinks that folks are going to pay outrageous bills is just plain not thinking.
Didn’t some folks from Enron go to jail over something like this
Read the order here - it was capping prices, not raising them.
https://www.puc.texas.gov/51617WinterERCOTOrder.pdf
Question - does Griddy know the difference between a kilowatt hour and a megawatt hour?
“As provided in §25.505(g)(6)(D), once the PNM threshold is achieved, the system-wide offer cap is set at the low system-wide offer cap (LCAP), which is is “the greater of”
either “(i) $2,000 per MWh and $2,000 per MW per hour; or (ii) 50 times the natural gas price index value determined by ERCOT, expressed in dollars per MWh and dollars per MW per hour.”
Due to exceptionally high natural gas prices at this time, if the LCAP is calculated as “50 times the natural gas price index value,” it may exceed the high system-wide offer cap (HCAP) of $9,000 per MWh and $9,000 per MW per hour. 16 TAC § 25.505(g)(6).
This outcome would be contrary to the purpose of the rule, which is to protect consumers from substantially high prices in years with substantial generator revenues. It would make little sense to expose consumers to prices that are higher than the usual maximum price after a generator
revenue threshold has been achieved”
Softening up the proles for the coming permanent energy price increases.
Only triple the past normal rate will be nice compared to this. Sheeple will be glad to have it!
“Good news, comrades! The chocolate ration has been increased to 25 grams!” (It was 30 grams last week.)
People need to realize that Milton Friedman’s concept of Realized Expectations means that the affect of some future event can be felt today. When Trump said he would hold true to his promise of corporate tax cuts and the business community believed it, corporate hiring and investment took off long before the tax cut went into effect. The same is happening now. Biden’s idiotic policies (e.e., promised tax increases on corporate and personal income, killing the Keystone Pipeline, fighting fracking, restricted gov’t oil leases, promised Green Deal policies) all have triggered market responses, including the rapid rise of distillate fuels.
Why would anyone with one neuron still firing think a man who’s been a politician for 46 years and never accomplished anything is prepared to run the largest economic engine on the planet. Pile on top of that the fact he doesn’t even know where he is most of the time, and you’ll quickly see this demented leader is going reverse all of the good things Trump did.
Idiots should learn to read the fine print.
Just pay your regular bill on time and don’t fall for variable rate plans.
“RTORPA” is the Real-Time On-Line Reserve Price Adder (in $/MWh) for the SCED interval.
“RTORDPA” – Captures impact of reliability deployments
during SCED Interval
Slide 99: http://www.ercot.com/content/wcm/training_courses/109648/BTP201M6_REAL-TIME_Nov2016.pdf
It looks like the add on per megawatt was really added by ERCOT.
Correct, this is done by an algorithm and all excessive charges will be backed out.
‘Cause everything is bigger in Texas.
ERCOT “Real-time” pricing the past few days, priced per “megawatt.”
MEGAWATT HOURS
I know.
The kilowatt charge is 1/1,000 of that.
So the price was stuck at roughly $9/kilowatt.
“Question - does Griddy know the difference between a kilowatt hour and a megawatt hour?”
What are you referring to?
“I know.
The kilowatt charge is 1/1,000 of that.”
uh, KILOWATT-HOURS! NOT KILOWATTS!
It’s all in hours.
That’s like having to constantly say “Megawatt Hours Of Electricity,” because you think no one knows it’s “electricity” or “hours.”
“It’s all in hours.”
Nope. There is a difference. Please accept your error and move on.
Texans had a choice between fixed rate charges and variable......I suspect those with variable are going to get hit hard.
LOL!
Okay, folks, all entries above mentioning “kilowatts” and “megawatts” should now be known as “kilowatts/hour of electricity” and “megawatts/hour of electricity.”
Thank you.
Correction:
“Kilowatt x hours (of electricity)” and “megawatt x hours (of electricity).
Enjoy!
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