Small wonder Britain is nearly bankrupt;
Energy firms will receive thousands of pounds a day per wind farm to turn off their turbines because the National Grid cannot use the power they are producing.
[…]
The first successful test shut down of wind farms took place three weeks ago. Scottish Power received £13,000 for closing down two farms for a little over an hour on 30 May at about five in the morning.
Whereas coal and gas power stations often pay the National Grid £15 to £20 per megawatt hour they do not supply, Scottish Power was paid £180 per megawatt hour during the test to switch off its turbines.
…’cause that ain’t how they do things in Texas!
During these negative price periods, suppliers are paying [Electric Reliability Council of Texas] to take their power. Consumers (at least at the wholesale level) are getting paid for using power, and the more power consumers use the more they get paid. These prices are a big anti-conservation incentive. You could, as a correspondent put it to me, build a giant toaster in West Texas and be paid by generators to operate it.
Infrequently, a power plant might choose to bid below the short term marginal price in order to stay in the market and avoid shutting down. It can be economically rational for operators of less responsive generation units to offer negative prices in order for it to avoid the costs of shutting down for just a few hours and then start up again when load increases – think coal-fueled or natural gas steam turbine. When energy load is very low, near zero or negative prices can result.
This isn’t the cast in West Texas. Instead, the negative prices appear to be the result of the large installed capacity of wind generation. Wind generators face very small costs of shutting down and starting back up, but they do face another cost when shutting down: loss of the Production Tax Credit and state Renewable Energy Credit revenue which depend upon generator output. It is economically rational for wind power producers to operate as long as the subsidy exceeds their operating costs plus the negative price they have to pay the market. Even if the market value of the power is zero or negative, the subsidies encourage wind power producers to keep churning the megawatts out.
The world is being run by crazy people.
h/t Larry