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PG&E files for bankruptcy. Here's why that could mean bigger electricity bills
PG&E Corp., which owns California's largest electric utility, filed for bankruptcy protection Tuesday in anticipation of huge legal claims, starting an unpredictable process that could take years to resolve and is likely to result in higher energy bills for the millions of Californians who depend on Pacific Gas & Electric for power.
PG&E said a Chapter 11 bankruptcy filing, which allows the company to continue operating while it comes up with a plan to pay its debts, was the only way to deal with billions of dollars in potential liabilities from a series of deadly wildfires, many of which were sparked by the company's power grid infrastructure.
"Through this process, we will prioritize what matters most to our customers and the communities we serve — safety and reliability," interim Chief Executive John R. Simon said in a statement. "We believe that this process will make sure that we have sufficient liquidity to serve our customers and support our operations and obligations."
Energy experts say PG&E's rates probably will increase when the utility emerges from Chapter 11 protection because bankruptcy inevitably makes it more expensive for a company to borrow money and creates large legal and other bankruptcy-related costs. The utility passes such expenses along to its customers.
"It's almost impossible to see a way out of this that doesn't have some short-term cost increases," Ralph Cavanagh, co-director of the energy program at the Natural Resources Defense Council, said in a recent interview.
(Score: 1) by Gault.Drakkor on Wednesday January 30 2019, @07:04PM (7 children)
Well if that is so, it will be interesting to see how they handle buying of surplus solar energy from individuals.
The current energy market assumes one of three traditional categories: base load, load following, peaking. Currently energy demand function is essentially sinusoidal with period of one day with a bunch of noise. Solar and wind production functions do not match demand function.
This, I suspect, is going to lead to a spectacular failure down the road.
As solar becomes less expensive then grid supplied energy, more people install solar. Efficiency of energy delivered will decrease as demand becomes less predictable and more volatile. This will likely lead to higher costs, repeat.
Where the spectacular failure will come in is when some event occurs that blocks sunlight for a week or two(bonus if low wind). I am sure some storage will be added, but probably not that much. So with insufficient storage many will need to get energy from the grid. That the grid can no-longer supply that demand because of less demand due to high prices cause the grid to remain at the same capacity or shrink. Hello rolling blackouts.
To avoid this, pricing of electrical energy must change. Preferably integrated with long term policies and planning. Do you believe this will happen? I do not.
(Score: 0, Flamebait) by fustakrakich on Wednesday January 30 2019, @08:21PM (4 children)
pricing of electrical energy must change.
Metering electricity is dumb. We generate way more than we use. The connection costs should be fixed, based on the wire gauge going into your house/office/factory...
And we need a global grid [geni.org] too.
La politica e i criminali sono la stessa cosa..
(Score: 1) by Gault.Drakkor on Wednesday January 30 2019, @09:33PM (3 children)
To say that we generate more then we use, if didn't, the costs would be enormous. Some industrial plants can take days to weeks to get back to full production after a unplanned power outage. Electricity is produced on demand. There is practically ZERO electrical energy storage. Sure there is storage in hydro, unspent fuel but that is not electrical energy storage. So if you generate somewhat more you dump excess as heat. If somewhat less is produced you get brownouts, less still you get blackouts.
As to metering, it is not silent, it is critical as signals to the free market to allow efficient operation. My point was that the price function is out dated. It needs to be updated for the new forms of energy production. And at the very least it costs energy to make the equipment to produce/extract energy. That has a price. We are not post scarcity.
Fixed connection costs per energy capacity? That ignores: power factor(you want good quality sin waves on the grid), the current demand and supply curves, median distance from source to sink(longer it has to go the more it costs).
Global grid: If electricity is not metered, who pays for the grid?
(Score: 1) by fustakrakich on Wednesday January 30 2019, @10:30PM (2 children)
who pays for the grid?
I already said, it's paid for with hook up and fixed monthly maintenance fees. Generation, as it becomes more decentralized, is becoming less of an issue.
La politica e i criminali sono la stessa cosa..
(Score: 1) by Gault.Drakkor on Thursday January 31 2019, @12:48AM (1 child)
Sorry, I was meaning who pays for the global grid. Because that should be separate project(s), since it is large and non trivial capital project.
General grid maintenance, yes of course it would come out of general connection fees.
(Score: 1) by fustakrakich on Thursday January 31 2019, @01:33AM
I was meaning who pays for the global grid.
"Global grid" is just a bunch of local/national grids all connected together. Money isn't the real issue. Petty politics is. I suppose expecting that kind of cooperation is a difficult prospect. We'd rather build walls instead of bridges.
La politica e i criminali sono la stessa cosa..
(Score: 2) by Thexalon on Wednesday January 30 2019, @10:42PM
Oh noes! People are going to install solar capacity, and the electric industry is going to have to learn to adjust to how to use them on a large scale. As opposed to continuing to use fossil fuels or nuclear plants for power generation, which we all know never fail and cause absolutely no problems whatsoever to anyone.
I know people who have built and live totally on an off-grid power system. It turns out that windmills and solar panels, plus second-hand substation batteries, work just fine for them. And it's in an environment where weather varies a lot more seasonally than in California too. So the problems you're describing are plainly solvable.
Also, higher electrical prices mean people will be encouraged to conserve power. How would that be a bad thing when it comes to providing the electric power needed?
The only thing that stops a bad guy with a compiler is a good guy with a compiler.
(Score: 2) by Phoenix666 on Wednesday January 30 2019, @11:57PM
That's more true of wind than solar. Solar produces best during the hours of peak demand. Germany's Energiewende has amply demonstrated this; the installed solar has already lopped off the profitable portion of the curve for the utilities. The utilities are stuck with the baseload in the overnight when they operate in the red, according to spot prices.
As for storage, battery backups will become more common as the battery tech improves and as sources of electricity switch to renewables. Tesla already installed a battery backup system for a utility in Australia, I believe, so there's a precedent now.
Failures will be much less catastrophic with massively distributed power generation. Smart switches are an option for households that want to retain a grid tie. Micro-grids are an option for neighborhoods or towns that want to go co-op style.
Washington DC delenda est.