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dopidopHN

Side note on what is currently existing with gravity.

The suiss folks are gaming the west European energy market this way.

When the French produce too much nuclear energy, the German have leftover and stop buying it 100%w Price go down.

Swiss buy it cheap and pump water in their dam system with it.

Inevitably, the french grid align and produce a bit less. Price goes up slightly.

That when the suiss comes out, release the water into a turbine system and sell the energy for a higher price that what they bought it for to German, French and Italian grid.

I can’t even be mad at them. They have the perfect setup. But you need the Swiss alp and climate to do what they are doing. And being freaking Swiss.

Source/Context from a Swiss news paper : le temps, in French

They describe that « system » and apparently it’s being disturb in recent years with the evolution of the German market.

https://www.letemps.ch/economie/barrages-suisses-vendre-esto...

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Maybe I do not understand it fully (ne pas parle de francais), but where do they game the system?

You buy cheap when you have storage and sell expensive when demand goes up. Pretty much how the market should work?

This way there is incentive to balance it out (by creating storage) - and in this case stabilize the grid.

When the grid would become more flexible, so even homeowners can do this with their solar panels and big batteries - then this should be net gain for everyone, no?

Unless gaming it, with big money, destabilises it. So some safeguards probably should remain.

It's not gaming the system, it is arbitrage. However, it is pretty terrible for producers unable to exploit price swings. E.g a nuclear plant produces electricity at a fixed cost and may sell it at a loss when the price is low, but recoups the losses when the price is high. Since arbitrage smooth out the price peaks, it damages nuclear's profitability. One could say that's too bad for nuclear, others (nuclear lobbyists) say that regulation is needed to prevent electricity arbitrage.

If the fixed price nuclear uses is too low to be profitable, then it must be raised.

If nuclear can offer sustained cheaper than average generation then the market would allow a long term fixed price contract — they shouldn’t need to sell their full output at spot rates. Consumers that want predictability could buy on these contracts.

You are correct, it's not gaming the system indeed. It's more something that they decided to do on their own, and rightfully so. It's a bit innervating for French tax payers to be on that side of the bargain. But at the same time, we have nuclear power plant, those cannot react that swiftly to market demands changes... it's all fair game. They actually provide some kind of buffer service.

> Price goes up slightly.

How much of a swing in pricing are we talking about here? Because that storage mechanism is maybe 80% efficient. So the price swing would have to be at least that big to break even. And in that case, if they are helping to smooth out swings in demand that are that large... Sounds like they're providing a valuable service.

https://en.wikipedia.org/wiki/Pumped-storage_hydroelectricit...

EDIT: Keep in mind that electricity is entirely fungible. This is no different than the Swiss turning on a power plant when prices are higher. Except it would probably be too expensive to have a power plant just sitting there idle when the price isn't "high enough".

> it would probably be too expensive to have a power plant just sitting there idle when the price isn't "high enough"

This is exactly what is done, and pretty much inevitably must be done - grids need spare capacity that can be relied on to spin up rapidly when demanded, that's usually done by gas turbine plants.

You mean they are selling large scale storage and managed to turn a profit?

That sounds great. They are first, but as we deploy more renewables, we'll need much more cases like this.

Oh it is great. I'm bitching about it because or friendly neighbors rivalry.

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