Todd Defends Len Once Again

Hi Todd,

On 4.6.06 you said "In a deregulated world, which is coming soon, the generation would be market driven and separated from T&D. The physical structure of our grid will only support regulated lines, but the spot pricing would be determined by a number of factors which include distance, contract longevity, dispatchability and the reliability terms agreed upon in the contract." Now it seems more complex than what you stated.

I like the statement "contract longetivity," because it might signal a middlemen and also "the reliability terms agreed upon in the contract," because it seems to contradicts the comment just posted.

At the end of the same post you added "I'm reminded of Len Gould's articles in here. Very good info and darned close to what I envision being the structure in 40 years. Why fight it? Early adopters profit the most, right?"

It is price controls that categorize customers on a few neat average classes. Differentiation is the opposite, to promote electricity without price controls. In that respect, please take a look at the post Please Blame the Deregulation and Regulation Fiascos Parte 35 to learn what Bob Lieberman show that the conventional wisdom (you defend) of residential response to real time prices won't work is wrong.

Power plant build up involves often costly systemic delays. A response based on short run electricity prices is a formula for adequacy problems, in which long run boom bust behavior leads to overbuiding and underbuilding capacity.

To implemented both of those requirements you need competitive 2GRs as explained on The Purpose Retailers Serve Customers.