European energy policy

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Bird on a Fire
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Re: European energy policy

Post by Bird on a Fire » Tue Mar 22, 2022 9:17 pm

IvanV wrote:
Tue Mar 22, 2022 8:27 pm
Bird on a Fire wrote:
Tue Mar 22, 2022 3:12 pm
The PIGS are coordinating their demands in advance of EU Council meeting later this week
...
Specifically, they're proposing an energy price cap:
....
Let's just tell those foreigners, we'll only buy their gas if they carry on selling it at the old price. We'll make them.
It's considerably more complicated than that ;) The EU uses wholesale gas prices to determine electricity prices. Here's Reuters from late last year:
Spain and France are among the EU countries seeking to change regulation to de-link the price of electricity from gas prices and tie it to the average cost of production in each EU state.

They say the current system, whereby gas plants typically set the price of electricity, means consumers do not benefit from the increasing share of cheaper renewable energy in countries' energy mixes.
https://www.reuters.com/markets/commodi ... 021-12-13/

Sounds like something of a market failure there, where the solution could even involve some liberalisation.

Though they're also pushing for strategic reserves using joint buying - if the EU as a whole were negotiating a price, as with vaccines, many countries would end up paying less and the whole bloc could be insulated from wild price swings. Apparently existing storage infrastructure has been massively underutilized (I'd oppose building more storage).

The "gas reference prices" refers to TTF things which I really don't understand at all, but Costa describes them as "forming the price on the market". It sounds to me like some whizzy high tech trading thing that is perhaps not optimising its performance for the public benefit.
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Re: European energy policy

Post by IvanV » Tue Mar 22, 2022 10:33 pm

Bird on a Fire wrote:
Tue Mar 22, 2022 9:17 pm
IvanV wrote:
Tue Mar 22, 2022 8:27 pm
Bird on a Fire wrote:
Tue Mar 22, 2022 3:12 pm
The PIGS are coordinating their demands in advance of EU Council meeting later this week
...
Specifically, they're proposing an energy price cap:
....
Let's just tell those foreigners, we'll only buy their gas if they carry on selling it at the old price. We'll make them.
It's considerably more complicated than that ;) The EU uses wholesale gas prices to determine electricity prices. Here's Reuters from late last year:
Spain and France are among the EU countries seeking to change regulation to de-link the price of electricity from gas prices and tie it to the average cost of production in each EU state.

They say the current system, whereby gas plants typically set the price of electricity, means consumers do not benefit from the increasing share of cheaper renewable energy in countries' energy mixes.
https://www.reuters.com/markets/commodi ... 021-12-13/
OK, I see what they are getting at.

The EU does not use have a rule saying that the wholesale gas price sets the price of electricity. Rather it has an electricity market. But there are reasons why the market outcome means that the price of electricity is often closely related to the wholesale gas price. Not because anyone says it should do, but because that's how markets work.

Markets are not mechanisms whereby you consider the production cost of all the items being sold into the market and average them. Rather they are mechanisms by which the price is bid down (or up if you prefer, it hardly matters), until supply matches demand. So everyone buys at the price of the producer who has the highest production cost still left in the market, for the quantity of electricity people will buy at that price. That will mostly be a gas station. Only relatively rarely will there be so much wind, sun, nuclear, etc, in the market that the only remaining gas left on is only to deal with swing. That can happen on a windy night at a warmer time of year in Britain. It can also happen on a very sunny day in Germany. But mostly there is some gas burning away because we need that much electricity.

So, you might think, that means most of the time most producers actually producing are selling for more than their production cost. And you would be right. And they need that money to pay for the construction cost of their plant. Because the price they are bidding in is only the running cost, not some average cost including their capital costs. Because that's what markets make you do. And being a gas plant has been really terrible in recent years, because you don't get to run so often, and you don't get enough money to cover your capital costs. This is called the Problem of the Missing Money. And is a feature of how we pay for renewables. As a result of the Problem of the Missing Money, governments have had to introduce Capacity Payments, or risk having no gas plants there when they need them.

I am afraid that linking the electricity price in the market to the average production cost, rather than the marginal production cost, is just utterly illiterate, and just can't work in the way we have built our electricity institutions. Maybe this is a bid by the French to destroy the single European energy market. Because the French have never really liked it. Because EdF have never really liked it. Because it benefits customers over EdF. And there are enough French politicians who feel sufficiently connected to EdF rather than French consumer interest that they will support EdF. And in general most electricity producers don't like the competition it creates.

You can tell producers to reduce the price of electricity, if you somehow don't bankrupt them. But many electricity producers are not profiting from this. They have put up the price of electricity because they have to pay more for gas. Ok, hydro producers and nuclear producers and the like will make more money, but that's usually on some kind of a state money-go-round. The solar and wind people won't benefit because they are on CfD's so the government takes any extra money they earn from higher prices. So I'm not entirely sure where they think all this profit is that can reduce the price of electricity to the "average cost" without shafting the producers, because they do actually need more than the average cost. Even though EdF, the biggest nuclear producer, will in principle get more money from selling its nuclear electricity, overall it is actually being crucified by what is happening. The French govt has told it to not increase the price of electricity very much to consumers, and it has problems with some of its stations. I read something the other day that this is costing it currently about €500m per week. Maybe that's before considering the extra money that's coming in, I don't know.

It's not very nice what is going on in the energy market. The best that can be said is that we were much poorer back in the 70s when developments in the energy markets then produced large increases in the price of oil and gas. It's part of why the 70s were not very nice at all. We are better able to cope with it today. We are less used to such bad times as back then.

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Re: European energy policy

Post by Bird on a Fire » Mon Apr 25, 2022 11:41 am

The Lisbon Chamber (CML) has unanimously approved the measure that will allow for free public transport in Lisbon for young people and people over 65 years old. Carlos Moedas says it was a “historic” decision, also stressing the fact that it brought all the parties together. “When people ask what the executive's legacy will be, for me this is undoubtedly the most important measure”, reiterates the president of CML.

“It is a historic day for our city, as we have achieved something unprecedented for the people of Lisbon”, points out Moedas, in statements broadcast by RTP3. The mayor highlights the environmental nature of the measure, also stressing that “there are very few cities in Europe that have already had the courage to do so”.

The measure covers young people up to 18 years old and persons over 65 years old, also covering university students up to 23 years old (or 24, in the case of medicine and architecture courses). There is also a common requirement for all: it is necessary to have tax residency in the municipality.
https://www.theportugalnews.com/news/20 ... -old/66539

If the capital of west Europe's poorest country can do this, so can every other large metropolis in Europe.
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Re: European energy policy

Post by Bird on a Fire » Wed Jul 20, 2022 12:03 pm

The European Commission has urged countries across the bloc to cut their gas use by 15% until March amid fears Russia could halt supplies.

It says the target is voluntary but will become legally binding if Moscow turns off the taps this summer.
https://www.bbc.com/news/business-62230201

Good thing they didn't waste any time getting started on efficiency measures to reduce demand way back in March when it was obvious this could happen (not to mention ethically imperative to stop funding Russian atrocities).
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Re: European energy policy

Post by Bird on a Fire » Wed Jul 20, 2022 12:07 pm

Meanwhile, plans to buy fossil fuels from people like Mohammed Bonesaw-man to avoid funding Russia are going well, due to the impermeable silos between producer countries:
Saudi Arabia, the world's largest oil exporter, more than doubled the amount of Russian fuel oil it imported in the second quarter to feed power stations to meet summer cooling demand and free up the kingdom’s own crude for export, data showed and traders said.

Russia has been selling fuel at discounted prices after international sanctions over its invasion of Ukraine left it with fewer buyers. Moscow calls the war in Ukraine a "special military operation".
https://www.reuters.com/business/energy ... 022-07-14/
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Re: European energy policy

Post by tom p » Wed Jul 20, 2022 1:02 pm

Bird on a Fire wrote:
Wed Jul 20, 2022 12:07 pm
Meanwhile, plans to buy fossil fuels from people like Mohammed Bonesaw-man to avoid funding Russia are going well, due to the impermeable silos between producer countries:
Saudi Arabia, the world's largest oil exporter, more than doubled the amount of Russian fuel oil it imported in the second quarter to feed power stations to meet summer cooling demand and free up the kingdom’s own crude for export, data showed and traders said.

Russia has been selling fuel at discounted prices after international sanctions over its invasion of Ukraine left it with fewer buyers. Moscow calls the war in Ukraine a "special military operation".
https://www.reuters.com/business/energy ... 022-07-14/
Saudi Arabia has been importing oil? Had the middlemen decided to diversify from selling coal to Newcastle & fridges to eskimoes?

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Re: European energy policy

Post by Bird on a Fire » Wed Jul 20, 2022 1:51 pm

tom p wrote:
Wed Jul 20, 2022 1:02 pm
Bird on a Fire wrote:
Wed Jul 20, 2022 12:07 pm
Meanwhile, plans to buy fossil fuels from people like Mohammed Bonesaw-man to avoid funding Russia are going well, due to the impermeable silos between producer countries:
Saudi Arabia, the world's largest oil exporter, more than doubled the amount of Russian fuel oil it imported in the second quarter to feed power stations to meet summer cooling demand and free up the kingdom’s own crude for export, data showed and traders said.

Russia has been selling fuel at discounted prices after international sanctions over its invasion of Ukraine left it with fewer buyers. Moscow calls the war in Ukraine a "special military operation".
https://www.reuters.com/business/energy ... 022-07-14/
Saudi Arabia has been importing oil? Had the middlemen decided to diversify from selling coal to Newcastle & fridges to eskimoes?
It means they can export all their oil to countries that don't want to buy from Russia. Then Saudi Arabia buys from Russia instead to make up the shortfall.
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Re: European energy policy

Post by nekomatic » Wed Jul 20, 2022 2:42 pm

Well, mercenaries gotta mercenar.
Move-a… side, and let the mango through… let the mango through

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Re: European energy policy

Post by Woodchopper » Wed Jul 20, 2022 2:58 pm

Bird on a Fire wrote:
Wed Jul 20, 2022 1:51 pm
tom p wrote:
Wed Jul 20, 2022 1:02 pm
Bird on a Fire wrote:
Wed Jul 20, 2022 12:07 pm
Meanwhile, plans to buy fossil fuels from people like Mohammed Bonesaw-man to avoid funding Russia are going well, due to the impermeable silos between producer countries:



https://www.reuters.com/business/energy ... 022-07-14/
Saudi Arabia has been importing oil? Had the middlemen decided to diversify from selling coal to Newcastle & fridges to eskimoes?
It means they can export all their oil to countries that don't want to buy from Russia. Then Saudi Arabia buys from Russia instead to make up the shortfall.
As well as that, Russia has been selling oil at a discount. So Saudi can use the cheap stuff itself and export its oil at market rates.

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Re: European energy policy

Post by Bird on a Fire » Wed Jul 20, 2022 3:08 pm

Thus helping two horrible regimes at the same time!

Hurray for the West and their principled stand, etc etc.
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Re: European energy policy

Post by tom p » Thu Jul 21, 2022 12:27 pm

Bird on a Fire wrote:
Wed Jul 20, 2022 1:51 pm
tom p wrote:
Wed Jul 20, 2022 1:02 pm
Bird on a Fire wrote:
Wed Jul 20, 2022 12:07 pm
Meanwhile, plans to buy fossil fuels from people like Mohammed Bonesaw-man to avoid funding Russia are going well, due to the impermeable silos between producer countries:



https://www.reuters.com/business/energy ... 022-07-14/
Saudi Arabia has been importing oil? Had the middlemen decided to diversify from selling coal to Newcastle & fridges to eskimoes?
It means they can export all their oil to countries that don't want to buy from Russia. Then Saudi Arabia buys from Russia instead to make up the shortfall.
I know. I read the article. I was being silly, for hopefully moderately humorous effect.

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Re: European energy policy

Post by Millennie Al » Thu Jul 21, 2022 10:59 pm

Bird on a Fire wrote:
Wed Jul 20, 2022 12:07 pm
Meanwhile, plans to buy fossil fuels from people like Mohammed Bonesaw-man to avoid funding Russia are going well, due to the impermeable silos between producer countries:
Nobody realistic thought that Russia could be stopped from selling oil. By forcing Russia to sell it cheaply due to its restricted market, we deprive Russia of money. If someone else happens to benefit from it, that's unavoidable. Completely stopping Russia exports could only be achieved by bombing pipelines and ports, which would be an act of war.

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Re: European energy policy

Post by Bird on a Fire » Fri Jul 29, 2022 8:55 pm

Remember when the EU solved the debt crisis by saying to south Europe, "Have you tried making your own coffee at work, instead of buying one for 0,50€ in a café?

That's about the level of their "strategy" to cut gas use by 15% before winter: the same micro-consumerist bollocks I've been hearing my entire lifetime that has spectacularly failed to solve the climate crisis. f.cking embarrassing. Putin will be absolutely pooing himself at the idea Europeans might start switching off lights when they're not using them, turning down the thermostat and dressing appropriately for the weather (the prize for Most Insultingly Facile "Tip" goes to Pedro Sánchez of Spain, from what I've seen so far).

So when the first cold-snap hits north Europe and Putin inevitably turns the taps off we can all just put our Слава Україні! jumpers on and ride it out.
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Re: European energy policy

Post by Bird on a Fire » Fri Jul 29, 2022 8:58 pm

In the debt crisis - which was mostly about imaginary money rather than real people getting the bombed to f.ck - south Europe was deemed to be "living beyond its means" and restructured. People lost their jobs, didn't receive their pensions, public services were sold cheaply to north European countries who promptly cut investment, etc.

North Europe is living beyond the planet's means. I assumed the reason they weren't getting a similar haircut was just typical neoliberal hypocrisy, but maybe it's another strategic energy saving tip to help keep their heads warm in winter.
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Re: European energy policy

Post by Woodchopper » Fri Jul 29, 2022 9:52 pm

Bird on a Fire wrote:
Fri Jul 29, 2022 8:58 pm
In the debt crisis - which was mostly about imaginary money rather than real people getting the bombed to f.ck - south Europe was deemed to be "living beyond its means" and restructured. People lost their jobs, didn't receive their pensions, public services were sold cheaply to north European countries who promptly cut investment, etc.

North Europe is living beyond the planet's means. I assumed the reason they weren't getting a similar haircut was just typical neoliberal hypocrisy, but maybe it's another strategic energy saving tip to help keep their heads warm in winter.
There will be an energy haircut. Unless things change rapidly there will be rationing in Germany this winter. Among other effects rationing will probably involve factories reducing production and workers being laid off.

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Re: European energy policy

Post by Bird on a Fire » Fri Jul 29, 2022 11:01 pm

Much better idea than ramping up investment in efficiency, insulation and renewables Europe wide, and leaving some nukes on in Germany, then.

Thank god there are some adults in the room, or they'd have blundered into a lose-lose-lose situation so as not to upset the status quo.
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Re: European energy policy

Post by Sciolus » Sat Jul 30, 2022 11:30 am

We know that governments are incapable of planning 20 years ahead, but it's pretty shocking that they are incapable of seeing 3 months ahead. You'd think some of Matt Hancock's mates would be willing to diversify from selling substandard PPE at a 100% profit margin to selling substandard home insulation at a 100% profit margin.

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Re: European energy policy

Post by Gfamily » Sat Aug 06, 2022 11:20 am

My avatar was a scientific result that was later found to be 'mistaken' - I rarely claim to be 100% correct
ETA 5/8/20: I've been advised that the result was correct, it was the initial interpretation that needed to be withdrawn
Meta? I'd say so!

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Re: European energy policy

Post by IvanV » Mon Aug 08, 2022 2:18 pm

Gfamily wrote:
Sat Aug 06, 2022 11:20 am
When the problem interferes with the solution

France required to reduce nuclear generation as the rivers are too warm for effective cooling
The same problem applies equally to all other thermal electricity generators using coal, gas, biomass, etc. Thermal electricity generation is based on a temperature difference, whatever the source of the heat.

In cooler countries, it is a convenient coincidence that the generators work less well when we need them less. The countries where it is aircon that produces the demand peaks are less fortunate.

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Re: European energy policy

Post by Bird on a Fire » Mon Aug 08, 2022 6:27 pm

IvanV wrote:
Mon Aug 08, 2022 2:18 pm
Gfamily wrote:
Sat Aug 06, 2022 11:20 am
When the problem interferes with the solution

France required to reduce nuclear generation as the rivers are too warm for effective cooling
The same problem applies equally to all other thermal electricity generators using coal, gas, biomass, etc. Thermal electricity generation is based on a temperature difference, whatever the source of the heat.

In cooler countries, it is a convenient coincidence that the generators work less well when we need them less. The countries where it is aircon that produces the demand peaks are less fortunate.
Which, in a matter of decades, will be pretty much all countries for at least some of the year. It's worth bearing in mind.

Loads of my friends from across the Atlantic (including Mexico, Colombia, Brazil, not just the US) are like "why do Europeans not have AC?!" and like feel from a personal comfort perspective they've got a good point. They're mainstream in newbuilds in Portugal for instance.

Long distance interconnectors will be helpful, instead of carrying rocks around in boats like a bunch of cavemen.
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Re: European energy policy

Post by bjn » Mon Aug 08, 2022 6:57 pm

IvanV wrote:
Mon Aug 08, 2022 2:18 pm
Gfamily wrote:
Sat Aug 06, 2022 11:20 am
When the problem interferes with the solution

France required to reduce nuclear generation as the rivers are too warm for effective cooling
The same problem applies equally to all other thermal electricity generators using coal, gas, biomass, etc. Thermal electricity generation is based on a temperature difference, whatever the source of the heat.

In cooler countries, it is a convenient coincidence that the generators work less well when we need them less. The countries where it is aircon that produces the demand peaks are less fortunate.
Countries that need air con typically have insolation that matches demand. Which is why one of my friends in Australia is installing solar panels and batteries in/on his house.

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Re: European energy policy

Post by Bird on a Fire » Mon Aug 08, 2022 7:07 pm

Southern US and southern EU have similar insolation, but AC is only normal in the US. There are definitely cultural factors too.
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Re: European energy policy

Post by WFJ » Mon Aug 08, 2022 7:40 pm

Bird on a Fire wrote:
Mon Aug 08, 2022 7:07 pm
Southern US and southern EU have similar insolation, but AC is only normal in the US. There are definitely cultural factors too.
I misread your post and the preceding one and was about to disagree. In the US, cheap quick-build houses with cardboard walls have far worse thermal efficiency than average European houses. Opening windows at night and closing them in the day can go a long way to keeping houses cool without AC.

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Re: European energy policy

Post by bolo » Mon Aug 08, 2022 7:46 pm

Bird on a Fire wrote:
Mon Aug 08, 2022 7:07 pm
Southern US and southern EU have similar insolation, but AC is only normal in the US. There are definitely cultural factors too.
Really? Madrid is at about the same latitude at New York. I'm pretty sure that nearly everywhere in the US South is further south than anywhere in the EU. Houston is further south than Cairo.

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Re: European energy policy

Post by bjn » Mon Aug 08, 2022 8:25 pm

bolo wrote:
Mon Aug 08, 2022 7:46 pm
Bird on a Fire wrote:
Mon Aug 08, 2022 7:07 pm
Southern US and southern EU have similar insolation, but AC is only normal in the US. There are definitely cultural factors too.
Really? Madrid is at about the same latitude at New York. I'm pretty sure that nearly everywhere in the US South is further south than anywhere in the EU. Houston is further south than Cairo.
French Guiana is a French Region and so is in the EU and is well south of Houston. /pedant mode

Having just spent two weeks in the high 30C range in Southern France in a 3 story 800 year old stone townhouse, it could really have done with air conditioning in the upper rooms where the bedrooms were, even if the ground floor was noticeably cool(er).

I was surprised at the relative lack of rooftop solar in that part of France, insolation is significantly higher than the UK and I thought it would have been a no brainer in any non historically listed building.

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