Reference: Playing With Fire and Collapse Part 10
Hi Arvid,
I suggest that you read the whole thing since it is a complex subject. That is why I said go as deep as possible. However, if you only want to look superficially, search for "Electricity WPC," "EWPC," and "electricity without price controls."
The third way is only in the article on the "future..." Above is another explanation on the historical notes. They use deregulation coming from "most of the other literature..." and the result was playing with fire...
Instead of playing with fire, it is better to develop simulation scenarios and to run system dynamics applied to water, gas and electricity – in a sense play with energy dynamics.
Arvid's comments,
José Antonio,
I will look into your articles about the, shall we call it, "third way"? ;)
And I note that we both agree that the old monopolies were better than the current system of deregulation. Concerning the EU pushed power and gas deregulation I have a rule; if they say something in Bruxelles, do the opposite.
( Spirits and liquor deregulation excluded ;) )
By the way, it's funny that no matter what the article we comment is about, we end up discussing power deregulation.
miércoles, diciembre 20, 2006
Playing With Fire and Collapse Part 10
Today Prof. Banks made some comments see below.
Response to Prof. Banks:
Prof. Banks -12.20.06 - On this article: “I had intended to drop out of the deregulation discussion for a very good reason: I know too much about it, and where this subject is concerned my memory is very good.
Prof. Banks - 12.24.05 - On A Few More Unfriendly Comments on Electric Deregulation. “I'm afraid however, that I cannot tell Jose Antonio Vanderhorst-Silverio exactly what he wants to know, because everything considered, my knowledge of this subject is relatively limited. For instance, I don't know as much of the engineering as I should and could know. What I do know, however, is the academic economics, and more important I know when people who know the economics as well as I do, or better, have decided to depart from the truth because it pays them to do so. And when I say "pays" I'm talking about real money, and not cigar store coupons or feelings of relief.
Prof. Banks -12.20.06 - On this article: “… the late Fred Schweppe - a brilliant man who also got everything wrong… he had made the mistake of reading the elementary economics books, and unfortunately concluded that the people who wrote them mostly knew what they were talking about, which they might or might not, but usually not in those few paragraphs where they discuss electric/gas deregulation - where the emphasis here should be on 'few'.”
1988 - On the book Spot Pricing of Electricity: On page 111, introducing Chapter 5 “A Possible Future Deregulation,” it can be read that: “This chapter only presents a set of basic ideas; it does not analyze their impacts because such analyses have not yet been done. Since the advantages and disadvantages have not been quantified, we are not advocating deregulation (i.e. we do not know whether there is “a lady or a tiger” behind the door).” Fred Schweppe died before the book was published. If Prof. Banks opinion is correct, then Prof. Schweppe changed his opinion.
1988 - On the book Spot Pricing of Electricity: On page 126, under Historical Notes and References – Chapter 5, “The deregulation concept of this chapter is based on a supply and demand marketplace. Most of the other deregulation literature is oriented only to the supply side i.e., to deregulating generation without altering the way users buy electricity. We believe that deregulation which considerers only the supply side of the supply-demand equation is very dangerous and could have very negative results… A second major difference between this chapter and most of the rest of the deregulation literature lies in our concern that the economics and physical security of power systems not be destroyed or compromised.”
Prof. Banks - 12.20.06 - On this article: “Unless I am mistaken, Jose is suggesting that there is something beautiful for deregulation scholars…”
Vanderhorst-Silverio: Only one dead scholar; the late Fred C. Schweppe.
Prof. Banks comment
I had intended to drop out of the deregulation discussion for a very good reason: I know too much about it, and where this subject is concerned my memory is very good.
I was at the NATO sponsored meeting in Portugal where a collection of cranks and fly-by-nights from both the US and Europe came to the conclusion that electric deregulation was the way to go, which was the main reason that they had been invited. The stars of that conference were Professor (of physics) Arthur Rosenfeld of the University of California (Berkeley), who got EVERYTHING wrong, and the late Fred Schweppe - a brilliant man who also got everything wrong. Why was this? In the case of Rosenfeld he thought - as I thought at the time - that any physicist probably knew more about electric deregulation than any economist, which may or may not be correct, but as I discovered a few years later when I climbed up on my anti-deregulation soapbox, is definitely not true where yours truly and a few others are concerned..
As for Dr Schweppe (from the electronics lab at MIT), he had made the mistake of reading the elementary economics books, and unfortunately concluded that the people who wrote them mostly knew what they were talking about, which they might or might not, but usually not in those few paragraphs where they discuss electric/gas deregulation - where the emphasis here should be on 'few'.
All of this took place about 20 years ago, and is no longer relevant, because now we see how the deregulation scam has turned out: it has failed, is failing or will fail just about everywhere. Sweden is one of the countries which the deregulation booster club designated a deregulation role model, and the last time I looked the consumer price of electricity had increased 70% since deregulation was initiated. The thing to remember here is that deregulation was sold to the voters in this country on the basis of efficiency (and not equity). The point was that the price to consumers was to fall, and even though there might be a few losers, most households would be winners. Instead the price has not only increased for households, but also for the energy intensive industries - which is very very bad news in a country where borders have unfortunately been opened to an absurd extent. I can also mention that in the case of France, deregulation would likely favor the good citizens of Paris while increasing the miseries of about half of the remaining country.
Unless I am mistaken, Jose is suggesting that there is something beautiful for deregulation scholars as well as the deregulation booster club in the published work of X, Y, Z...whoever. Assuming that I ever teach a course in economics again where deregulation is a main topic, any student who mentions even en-passant any of this literature during my lectures becomes a candidate for a failing grade. I don't have to mention I hope what happens to any scholar or pseudo-scholar appearing in a seminar room at this university with a deregulation song-and-dance. As I explained to Prof David Newbery of Cambridge University, he has received his warning that clown time is over, and from now on it's going to be real business.
Response to Prof. Banks:
Prof. Banks -12.20.06 - On this article: “I had intended to drop out of the deregulation discussion for a very good reason: I know too much about it, and where this subject is concerned my memory is very good.
Prof. Banks - 12.24.05 - On A Few More Unfriendly Comments on Electric Deregulation. “I'm afraid however, that I cannot tell Jose Antonio Vanderhorst-Silverio exactly what he wants to know, because everything considered, my knowledge of this subject is relatively limited. For instance, I don't know as much of the engineering as I should and could know. What I do know, however, is the academic economics, and more important I know when people who know the economics as well as I do, or better, have decided to depart from the truth because it pays them to do so. And when I say "pays" I'm talking about real money, and not cigar store coupons or feelings of relief.
Prof. Banks -12.20.06 - On this article: “… the late Fred Schweppe - a brilliant man who also got everything wrong… he had made the mistake of reading the elementary economics books, and unfortunately concluded that the people who wrote them mostly knew what they were talking about, which they might or might not, but usually not in those few paragraphs where they discuss electric/gas deregulation - where the emphasis here should be on 'few'.”
1988 - On the book Spot Pricing of Electricity: On page 111, introducing Chapter 5 “A Possible Future Deregulation,” it can be read that: “This chapter only presents a set of basic ideas; it does not analyze their impacts because such analyses have not yet been done. Since the advantages and disadvantages have not been quantified, we are not advocating deregulation (i.e. we do not know whether there is “a lady or a tiger” behind the door).” Fred Schweppe died before the book was published. If Prof. Banks opinion is correct, then Prof. Schweppe changed his opinion.
1988 - On the book Spot Pricing of Electricity: On page 126, under Historical Notes and References – Chapter 5, “The deregulation concept of this chapter is based on a supply and demand marketplace. Most of the other deregulation literature is oriented only to the supply side i.e., to deregulating generation without altering the way users buy electricity. We believe that deregulation which considerers only the supply side of the supply-demand equation is very dangerous and could have very negative results… A second major difference between this chapter and most of the rest of the deregulation literature lies in our concern that the economics and physical security of power systems not be destroyed or compromised.”
Prof. Banks - 12.20.06 - On this article: “Unless I am mistaken, Jose is suggesting that there is something beautiful for deregulation scholars…”
Vanderhorst-Silverio: Only one dead scholar; the late Fred C. Schweppe.
Prof. Banks comment
I had intended to drop out of the deregulation discussion for a very good reason: I know too much about it, and where this subject is concerned my memory is very good.
I was at the NATO sponsored meeting in Portugal where a collection of cranks and fly-by-nights from both the US and Europe came to the conclusion that electric deregulation was the way to go, which was the main reason that they had been invited. The stars of that conference were Professor (of physics) Arthur Rosenfeld of the University of California (Berkeley), who got EVERYTHING wrong, and the late Fred Schweppe - a brilliant man who also got everything wrong. Why was this? In the case of Rosenfeld he thought - as I thought at the time - that any physicist probably knew more about electric deregulation than any economist, which may or may not be correct, but as I discovered a few years later when I climbed up on my anti-deregulation soapbox, is definitely not true where yours truly and a few others are concerned..
As for Dr Schweppe (from the electronics lab at MIT), he had made the mistake of reading the elementary economics books, and unfortunately concluded that the people who wrote them mostly knew what they were talking about, which they might or might not, but usually not in those few paragraphs where they discuss electric/gas deregulation - where the emphasis here should be on 'few'.
All of this took place about 20 years ago, and is no longer relevant, because now we see how the deregulation scam has turned out: it has failed, is failing or will fail just about everywhere. Sweden is one of the countries which the deregulation booster club designated a deregulation role model, and the last time I looked the consumer price of electricity had increased 70% since deregulation was initiated. The thing to remember here is that deregulation was sold to the voters in this country on the basis of efficiency (and not equity). The point was that the price to consumers was to fall, and even though there might be a few losers, most households would be winners. Instead the price has not only increased for households, but also for the energy intensive industries - which is very very bad news in a country where borders have unfortunately been opened to an absurd extent. I can also mention that in the case of France, deregulation would likely favor the good citizens of Paris while increasing the miseries of about half of the remaining country.
Unless I am mistaken, Jose is suggesting that there is something beautiful for deregulation scholars as well as the deregulation booster club in the published work of X, Y, Z...whoever. Assuming that I ever teach a course in economics again where deregulation is a main topic, any student who mentions even en-passant any of this literature during my lectures becomes a candidate for a failing grade. I don't have to mention I hope what happens to any scholar or pseudo-scholar appearing in a seminar room at this university with a deregulation song-and-dance. As I explained to Prof David Newbery of Cambridge University, he has received his warning that clown time is over, and from now on it's going to be real business.
Editorial El Día: El País Eléctrico
Editorial del 20 de diciembre de 2006.
En términos prácticos, por lo que significa la generación y venta de electricidad verdaderamente servida, no existe un país eléctrico. O sea, no somos un país con autoridades preocupadas por el desarrollo, ya que la falta de energía cierra todos los caminos del desarrollo y la competitividad.
Todo luce que el año, en términos energéticos, va a terminar como empezó. Sin grandes avances para resolver el problema de la generación suficiente para suplir la demanda nacional.
No hay mejor indicio que la situación que vivimos por la renegociación de los contratos eléctricos. Las partes hablan de “sostenibilidad del sector eléctrico”, plantean la necesidad de una “estabilidad en el mercado” y quieren “beneficios reales para el sector de distribución”.
Además, plantean el respeto que debe mantenerse ante cualquier iniciativa de negociación entre el sector privado y el Estado, el cual demandan que se haga “con apego a la ley y a los acuerdos internacionales” asumidos por el país.
El alegato de las autoridades es que ninguna de las empresas que operan bajo el Acuerdo de Madrid ha cumplido con lo estipulado en los contratos de compra y venta de energía. Y como prueba al canto hicieron público un informe que detalla la cantidad de megavatios que contrataron y los que efectivamente suministran. Hay en todas las empresas –EGE-Itabo, Dominican Power Partner, EGE-Haina– un déficit en perjuicio del Estado y los clientes finales, que reciben apagones constantes fruto del déficit de origen.
Se trata de un problema eterno, que, desafortunadamente, no tendrá solución en diciembre de 2006. De nuevo nos esperanzamos y abrazamos a una solución. Por delante tenemos, esperanzadoramente, los 365 días de un nuevo año.
En términos prácticos, por lo que significa la generación y venta de electricidad verdaderamente servida, no existe un país eléctrico. O sea, no somos un país con autoridades preocupadas por el desarrollo, ya que la falta de energía cierra todos los caminos del desarrollo y la competitividad.
Todo luce que el año, en términos energéticos, va a terminar como empezó. Sin grandes avances para resolver el problema de la generación suficiente para suplir la demanda nacional.
No hay mejor indicio que la situación que vivimos por la renegociación de los contratos eléctricos. Las partes hablan de “sostenibilidad del sector eléctrico”, plantean la necesidad de una “estabilidad en el mercado” y quieren “beneficios reales para el sector de distribución”.
Además, plantean el respeto que debe mantenerse ante cualquier iniciativa de negociación entre el sector privado y el Estado, el cual demandan que se haga “con apego a la ley y a los acuerdos internacionales” asumidos por el país.
El alegato de las autoridades es que ninguna de las empresas que operan bajo el Acuerdo de Madrid ha cumplido con lo estipulado en los contratos de compra y venta de energía. Y como prueba al canto hicieron público un informe que detalla la cantidad de megavatios que contrataron y los que efectivamente suministran. Hay en todas las empresas –EGE-Itabo, Dominican Power Partner, EGE-Haina– un déficit en perjuicio del Estado y los clientes finales, que reciben apagones constantes fruto del déficit de origen.
Se trata de un problema eterno, que, desafortunadamente, no tendrá solución en diciembre de 2006. De nuevo nos esperanzamos y abrazamos a una solución. Por delante tenemos, esperanzadoramente, los 365 días de un nuevo año.
Suscribirse a:
Entradas (Atom)