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30-Jan-2018 11:03 by 3 Comments

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But studies have shown that in order to change people's habits, peak power costs must be more like four times the cost of power during periods of low demand. It seems likely that as the economy continues to grow, electricity demand will grow with it, soaking up the supply glut.Even the longest contracts for the costliest power will begin to run out and can be replaced with cheaper alternatives.

"One is when you hit the price where renewables like wind and solar are cheaper than building new gas or coal plants," she says.The final bill also includes charges such as transmission fees and taxes.A secure source of electrical power is so crucial to a modern economy that government agencies must plan decades in advance to make sure the lights don't go out.Electrical authorities must have enough capacity to supply the system when demand is at its peak.And commercial generators won't invest unless they have a secure market for their output.While some people say the massive new Tesla battery now up and running in Australia is the solution, the three experts pointed to a cheaper way of creating new capacity that doesn't require building anything — instead depending on pricing mechanisms to force consumers and industrial users to avoid using power during periods of peak demand.

It's been tried in Ontario with little effect on usage, and consumers don't like it.

Efficient generation technology, including low-cost wind and solar, and natural gas prices at levels no one predicted a decade ago have contributed to those bargain prices.

According to the rules of market economics, that should be a good thing.

As described in a report by Fremeth and his colleagues, wholesale power prices have plunged well below the cost of production.

"But only those who import from Ontario are paying that price," says Pierre-Olivier Pineau, an expert in energy policy and markets at HEC Montreal business school.

"The second important milestone is when new renewables become cheaper than operating existing plants." She says we're reaching that second moment now.

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