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Comment by konschubert | Hacker News Reader

Price won’t go negative unless there are subsidies.

EDIT: If you’re downvoting this, please explain to me why a solar or wind power plant owner won’t immediately shut off his plant once prices go negative. A PV curtailment takes 30 seconds or less.

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This is simply not true. Here in Europe it is explicit that subsidies are not paid during negative prices.

It can take more than 12h for some thermal plants to pick up steam after they have shut down. So it sometimes makes sense to produce and pay in order to regain profits at the following non-negative hours.

It takes about a minute or two to curtail a solar or a wind power plant - if you’re slow.

Negative prices happen because plants are still subsidised during negative price periods. The 4 and 6 hour rules in Germany only apply to newer plants, and many phases of negative prices are shorter than that.

France has the 1 hour rule apply to all renewable plants, but there are still subsidies available in the form of time-shiftable origination certificates.

But all of this is improving and we are going to see prices go less negative in future.

Thank you for being a voice of sanity. The idea that once renewables are fully built out, and grid-scale storage is available and subsidies are no longer needed, that prices will be free or negative makes absolutely no sense.

Market prices for power will possibly be 0 for some slices of time in the day. After all, the marginal cost of producing power it is 0.

But most of the time, prices will be positive since batteries will smooth out demand.

>This is simply not true. Here in Europe it is explicit that subsidies are not paid during negative prices.

Well in Europe you can sell guarantee of origins. This drives down opex for a solar plant, at least the plants i manage in my job on the day-ahead market.

It results in a nonzero strike price, yes.

> Here in Europe it is explicit that subsidies are not paid during negative prices.

This may be approximately true for new plants coming online.

But existing plants get to keep their old subsidy schemes for a period of N years, at least here in Germany.

Because the owner does not typically sell with a market price but with a power purchase agreement where the buyer agrees to buy all electricity produced at the agreed price.

(This is an educated guess, not knowledge, so take with a grain of salt.)

It is true that the plants have power purchase agreements, but:

The owner can still buy back the power in the spot market and turn off his plant. He can then deliver the power he bought on the spot market to the PPA. If prices are negative, this means the owner gets paid for turning off the plant buying back the power. So the plant still gets curtailed.

All this is assuming no subsidies and that the PPAs don’t contain any weird origination provisions.

I’d think a PV panel runs cooler under load since it diverts ~25% of the light energy hitting it down the wire as electricity instead of just heating up the panel. Otherwise where else is the light energy going with no load?

If that theory is correct, paying someone to take your electricity is worthwhile.

Of course, it could operate its own shunt load on-site but not worth it if it runs a few hours a year.

And I’ve no idea if a panel has a longer or shorter lifespan if it just runs hotter but unloaded. But definitely going to take a hit to production if prices go positive in 5 minutes but your panel is baking.

It’s true that a panel runs cooler under load but this does not affect lifespan in a way that warrants paying even $0.001 to deliver the power.

If we assume 1st order decay, 1h at at a 10C hotter temperature will reduce lifespan by 2-3h.

And like I said, hot panels reduce production so in 5 or 50 minutes when rates are positive, losing 5-10% of your production is no Bueno. Panels usually have passive cooling, so if there’s little wind…

It really sounds like nobody has modelled. There is some negative value worth selling for but nobody seems to know what it is (or keeps it a secret)

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