Europe faces an unusual problem: ultra-cheap energy - https://web.archive.org/web/20240620151949/https://www.economist.com/finance-and-economics/2024/06/20/europe-faces-an-unusual-problem-ultra-cheap-energy
Europe faces an unusual problem: ultra-cheap energy - https://web.archive.org/web/20240620151949/https://www.economist.com/finance-and-economics/2024/06/20/europe-faces-an-unusual-problem-ultra-cheap-energy
I gave you a very simple example with a grocery shop. There’s not much difference between setting up a new shop or energy provider.
There’s a huge difference. You completely sidestepped the interesting bit, which is the monopoly on infrastructure (e.g. power lines in the city up to your residence). Someone owns and maintains those lines. That is the part I’m concerned about.
It’s easy to compete on energy production (e.g. farms) or customer service (e.g. grocery delivery), but it’s hard, if not impossible, to compete on infrastructure (e.g. the store itself). If there’s an energy shortage (i.e. store runs out of food), you can’t just go to another provider, they’re all using the same grid. The analogy would work if you’re assigned to a store, but you can choose the cashier, and perhaps cashiers are paid based on customers served. Or perhaps if prices are fixed across grocery stores and they somehow share inventory, but how they layout the store differs.
So it sounds a lot more similar to the municipal fiber initiatives in my area. Basically, there’s one network owned by the municipality, and companies provide “service” on that network, but any maintenance goes to the city-owned network to manage (e.g. the local monopoly). In pretty much every case, it’s a distinction without a difference, because they all just present the same underlying service with a different veneer. I don’t know if the UK has the same concept, but it’s also like an MVNO (a company offering mobile service on a major network’s hardware), but with even less variety in pricing (how many pricing tiers can you actually have for electricity?). I like my MVNO, but I get the same service quality regardless of the MVNO I select, provided they’re all backed by the same network.
I’m not sidestepping anything. When you’re opening a grocery shop, you don’t build a building for it, you’re not doing plumbing, you’re not supplying electricity to it. And you’re not doing logistics and don’t grow wheat. If there’s an issue with bread producers, you don’t get bread and you can’t do shit about it. There’s absolutely no difference between opening a shop and becoming an energy supplier.
Ok, I guess it makes a little sense if you’re looking at it from the business owner’s perspective, at least in terms of setting up a new business. But that applies to any form of retail.
But grocery stores provide value apart from just buying straight from their suppliers. They provide proximity so you can get products at any time. They provide a buffer so if one store runs out, you can go to another. They provide services, like doughnuts, cut fruit, and sliced meat. And so on.
Unless I’m mistaken, energy companies don’t provide anything like that. To the customer, they just provide customer support and a portal to accessing the same stuff as their competitors. There’s no difference between infrastructure and probably energy price, and that’s the interesting part about an energy company.
So what value are they providing?
Energy providers also provide additional value. For example, some energy providers provide only 100% renewable electricity, while most provide electricity from all sources. Some of them have night tariffs, some have EV specific tariffs with integration with your charging station. They also have different incentives for people who want to install solar panels. For example, some might pay a portion of your installation bill, while others might provide a preferential buy back rate.
Some of them also provide additional services to their clients, like switching your house from standard 230V 100A supply to 230V 300A supply (that’s how you get 22kW EV charging at home in the UK). The thing is that energy infrastructure in the UK is standardised, so any company with a correct licence can do upgrades.
We get that too, but just from our one power company. I basically have two options for payment agreements, a block-based system (1st 400kWh at one price, everything else at a higher price) and a time of use system (half price off peak, double price on-peak). There’s technically a third for low-income people.
We also have a net metering incentive as well, so basically if you supply power to the grid, you only pay the net between your production and your use. If you go negative, it rolls to the next month, and that extra resets at the calendar year.
We can also pay for blocks of 100% renewables ($2 extra per 100 kWh per month), and there are a few incentives again (e.g. discounts/rebates for smart thermostats, low-power appliances, etc).
So it sounds like I’m getting pretty much the same choices you are, I just don’t get to choose who handles my billing.
Interesting, but that has nothing to do with the privatized electrical companies. If we had triple phase power at the street, I could pay any electrician to do the swap, and they’d probably just notify the power company (and maybe pull a permit from the city). What’s odd is that triple phase seems possible on the power company’s website (i.e. there are different charges in the rates disclosure), but I really don’t think it’s common at all.
Anecdotally, I can get up to 11kW @ home w/o needing triple phase power. I have a 50A 220V circuit at home for my oven, as well as 3 220V circuits in my garage that could probably be upgraded to 50A (two are 30A, the other is 20A). That’s plenty for me, but it would be cool to have faster charging I suppose.
Anyways, private energy works great in the UK.
Speaking of power supply, you have multiple lines. That’s an option here too. We also have an option to have a triple phase 415V (these are rare in domestic applications, but in my home country in Latvia that’s how you hook up an electric oven and a hob). Somehow there’s no limit on how much power the 415V line can deliver, I’ve seen some tables that allow up to 1700 Amps, which is completely bonkers. That’s a bloody megaWatt of power!
That’s an insane amount of power! I’m guessing they don’t have a difference between industrial and residential lines? Because that much power could make sense for a factory, but it certainly doesn’t make sense for a house.
I don’t think residential properties can get all the Amps (: