Ugh. Another article talking about grid "death spiral" when the grid is a commons, a utility function. If we recapitalise how we implement the grid to make it amenable to solar at scale at the edge, implementing resiliency and syncons and batteries and manage load and storage, it's a death spiral for rent seeking producers who as the article states were paid inflated prices to fail to produce reliable power.
skybrian•9mo ago
It sounds like electricity prices went up in Pakistan because supplier costs went up, not due to rent-seeking:
> The sharp depreciation of the Pakistani rupee combined with falling electricity demand — in part due to the rise in solar — have pushed electricity prices upward. Russia’s war in Ukraine added an extra layer of pressure as gas prices increased.
abdullahkhalids•9mo ago
It's more complicated than that.
Pakistan's economy has been so bad for so many decades, no one wants to invest dollars into the country. The way the Pakistani government was able to set up power plants in the last decade was to give sovereign guarantees that investors will get fully paid back even if the power plant turns out to be economically unviable.
This means there is an agreed number in dollars that power plant investors get per year, whether the power plant sold 0 units or all possible units, and irrespective of the Rupee denominated price of electricity. They call it capacity charges.
So on this parameter alone it is in the interest of the Pakistani state to encourage demand as much as possible so power plants are used at full capacity. Unfortunately, there is a trade off. Many power plants are run on imported fossil fuels. So increased electricity demand places incredible strains on Pakistan's dollar reserves, which approached zero about 3 years ago. Similarly, fossil fuel price increase destroys the Pakistani economy, because something like 60% of imports are just fossil fuels.
Renewables cause similar problems in the short run, but hopefully in the long run they will be beneficial. Long run here means till after all the foreign power plant owners have been paid off in about 15 years.
michael1999•9mo ago
Who maintains the core network if 90% of the edge is self-sufficient? That's a lot of wires to keep up if there isn't much power running through them most of the time.
To be fair - the grid is already failing in Pakistan. Adding solar to the edge is only increasing resiliency.
But in countries with functioning grids, a flight to solar could cause the same sort of user-pay funding crisis that electric cars have done for gas taxes.
conk•9mo ago
There’s no funding crisis from EVs. A car that drives 12k miles/year is going to net at most ~$250 in gas tax revenue (using CA rate ~.7/gal). This can be added to the vehicle registration easy enough.
metalman•9mo ago
the grid in pakistan has always been broken.
electric, gas, water, roads, are often disrupted, nobody gets too upset, it's just how it is.....and as there is a strong cultural idea around living in compounds, and making do, solar is uniquely atractive, add in the recent advances in building transformerless, inverter based grids, that would allow indivduals to then get paid for the power they produce, and we could see a quick transition to a fully distributed grid
it will be interesting to watch how this develops
ggm•9mo ago
skybrian•9mo ago
> The sharp depreciation of the Pakistani rupee combined with falling electricity demand — in part due to the rise in solar — have pushed electricity prices upward. Russia’s war in Ukraine added an extra layer of pressure as gas prices increased.
abdullahkhalids•9mo ago
Pakistan's economy has been so bad for so many decades, no one wants to invest dollars into the country. The way the Pakistani government was able to set up power plants in the last decade was to give sovereign guarantees that investors will get fully paid back even if the power plant turns out to be economically unviable.
This means there is an agreed number in dollars that power plant investors get per year, whether the power plant sold 0 units or all possible units, and irrespective of the Rupee denominated price of electricity. They call it capacity charges.
So on this parameter alone it is in the interest of the Pakistani state to encourage demand as much as possible so power plants are used at full capacity. Unfortunately, there is a trade off. Many power plants are run on imported fossil fuels. So increased electricity demand places incredible strains on Pakistan's dollar reserves, which approached zero about 3 years ago. Similarly, fossil fuel price increase destroys the Pakistani economy, because something like 60% of imports are just fossil fuels.
Renewables cause similar problems in the short run, but hopefully in the long run they will be beneficial. Long run here means till after all the foreign power plant owners have been paid off in about 15 years.
michael1999•9mo ago
To be fair - the grid is already failing in Pakistan. Adding solar to the edge is only increasing resiliency.
But in countries with functioning grids, a flight to solar could cause the same sort of user-pay funding crisis that electric cars have done for gas taxes.
conk•9mo ago