California may again offer the nation a useful illustration this summer of how not to deal
with an energy crisis.
Blog last month passed along the warning from the Federal Energy Regulatory Commission that
the southern half of our state is in “the worst electricity supply situation in the entire
country.” I’m not worried about it, though, because I know that the California Energy
Commission has been working for five years to come up with a plan.
Pitch in this summer, California. When you hear the “Flex Your Power NOW!” alert, immediately
conserve energy. Learn more about what to do when you
hear the alert.
And thus we continue in the great tradition of California regulators, who seek with great
diligence, earnestness and, dare I say, ingenuity, to try to balance supply and demand every day
by telling each one of us exactly what we need to do. As long as we all maintain the proper
spirit and check up on the Conserve-O-Meter as the day progresses, I’m certain that all
Californians can be counted on to do the right thing, ensuring the equality of supply and demand
as a result of conscientious attention to civic duty.
I suppose that it’s because I’m an economist that I find this mindset a bit baffling. I do
not understand why the California Energy Commission assumes that people will pay more attention
to “flex your power now” alerts than they would to something that actually affects their
pocketbook. Call me cynical, but I somehow figure that adding to the dandy phrase “flex your
power now” the explanatory sequel “because if you don’t, it will cost you more” could give the
program just a bit more effectiveness.
As noted by
Peak Oil Optimist, some stabs at peak load pricing are being explored in the state on a
piecemeal basis, such as our href="http://www.signonsandiego.com/uniontrib/20050128/news_1n28electric.html">local San Diego
supplier’s plan to charge the largest electricity users a higher rate when the need for
conservation is greatest. But there seems to be considerable reluctance to implement such
schemes for all electricity users.
In part I suppose this represents the view that regular people (as opposed to heartless big
companies) don’t like to have to pay for more for electricity at some times than others. But
regular people don’t like to turn down their air conditioners when it’s hot, either, and they
like it even less when there’s a general blackout and nothing happens when you flip any
switches. My big idea is to let people choose between (a) and (b) in order to make sure that
(c) doesn’t happen.
Or maybe the regulators reckon that companies are smart enough to figure out how to lower
their electricity use when there’s a strong enough financial incentive to do so, but ordinary
people aren’t. Though one wonders, if they trust me with a Conserve-O-Meter, why don’t they
trust me with an electric bill?
But even this excuse of those poor stupid consumers may soon become technologically obsolete.
Lynne Kiesling at Knowledge
Problem describes some extremely useful new technology developed by href="http://www.pnl.gov/">Pacific Northwest National Laboratory:
It works like this: you buy an appliance that has one of PNNL’s grid-friendly controller chips
installed; the chip can cost anywhere from $5 to $25 depending on how sophisticated the desired
appliance response is. In its simplest form, a hot water heater with the grid-friendly
controller can send and receive information about how much energy it’s using, and it can be
programmed to use less power at various triggers (such as peak hours). If it’s programmed for
more sophisticated response, you could program your hot water heater to have an automated
response to retail power price changes.
Gizmos like that, and a pricing structure that encourages their use, would bring a conclusive
end to the era of electricity brownouts and blackouts. But I hope they leave the
Conserve-O-Meter up as a fun souvenir of the way things used to be.