Original del periódico EL DIA Quiero no tener razón, en Mis Buenos Días, por el Dr. Rafael Molina Morillo
El señor José Antonio Vanderhorst Silverio, Ph.D., consultor sistémico, me manifiesta su desacuerdo con mi columna de ayer, en la que yo expresaba mi desazón por el poco interés que, según la encuesta Hamilton/EL DIA, pone el dominicano a los temas de la corrupción y la educación.
“Su preocupación de que ‘como nación, no nos salva ni el medico chino’ –me escribe- puede ser atinada por muchas circunstancias, pero humildemente no creo que se deba llegar a esas conclusiones al interpretar la encuesta a la que usted se refiere.
“Creo –prosigue- que su ‘… razonamiento de que al 98% de los dominicanos la educación les importa un carajo’, no se desprende de dicha encuesta. Aunque ha sido el sector productivo quien ha llevado la voz cantante en el reclamo de la prioridad de la educación, entiendo que el pueblo dominicano sí le da importancia a la corrupción y le presta atención a la educación dentro de los 11 problemas cruciales que le afecta. Estimo que para salvar la nación lo que hace falta es desarrollar una masa crítica de verdaderos líderes en todos los estratos de la población.
“Sugiero que los líderes verdaderos del sector privado necesitan apoyar a los líderes verdaderos del sector público para que tomen las decisiones correctas de políticas que apoyen el desarrollo económico y reduzcan la pobreza. Es por eso que sugiero que sean los sectores productivos los que se encarguen de la educación aplicada en liderazgo y seleccionen la reforma del sector de electricidad como la fuente de las más grandes oportunidades latentes para el desarrollo del país.
“Un consenso nacional de alto nivel en los sectores productivos, sin esperar a que concluya la campaña electoral, puede ser la fuente que ayude al acceso de dicha cuenta del milenio para implantar el cambio cultural requerido. Es de esa forma como nuestras creencias (el médico chino que llevamos cada uno dentro de nuestras mentes) nos puede salvar.”
(Hasta aquí la carta de Vanderhorst. Yo quisiera que él tenga razón).
(r.molina@codetel.net.do).
martes, abril 08, 2008
lunes, abril 07, 2008
Electricidad y Educación Aumentarán Poder Adquisitivo Población
© 2008. José Antonio Vanderhorst Silverio, Ph.D.
El titular del periódico EL DIA sobre la encuesta Hamilton/EL DIA llama poderosamente la atención: “Corrupción sólo preocupa a un 5% de la población: Apenas 2 de cada cien piensan que educación es un problema prioritario.”
Es importante buscar las creencias en que descansan esas estadísticas y mucho más el diseño de la encuesta. Mirando la noticia bajo la firma de José P. Monegro, salen a relucir tres suposiciones importantes que enmarcan la pregunta: la pregunta misma, las posibles respuestas y el hecho que la población debía identificar una o dos de sus muchas preocupaciones.
La pregunta fue ¿Cuál de estos asuntos, cree usted, que es el más importante a ser tratado por el próximo gobierno? Todos sabemos que el próximo gobierno deberá tratar mucho más de un asunto.
Como tanto las respuestas “otro (especifique) y “no sabe” no aportaron nada en la encuesta, puede decirse que el diseño aporta que son solamente 11 las grandes preocupaciones de la población dominicana. La respuesta entonces es que el gobierno debería concentrarse en resolver no uno, o dos (como aparece en la encuesta como opciones combinadas), sino todos esos 11 problemas, algunos a corto plazo y otros a largo plazo, iniciando los esfuerzos simultáneamente. Es evidente que energía, agua y educación son tres grandes problemas a largo plazo que facilitarán minimizar eventualmente los de corto plazo.
Es evidente que el diseño de la encuesta influenció a que la población le diera mayor énfasis a los problemas de corto plazo “vinculados a la economía personal,” como dice Monegro. Dado que la creación de fuentes de trabajo y la reducción de los precios de los productos de primera necesidad tienen un impacto crucial e inmediato en el poder adquisitivo de las familias, no es de extrañarse que hayan sido seleccionadas como la primera y la segunda preocupación.
Dado que el gobierno ha invertido de manera excesiva en subsidios que no son sostenibles en energía, no es de extrañar que se haya invertido el problema de la electricidad (reducción de los apagones en 6% ) y la mejora de la salud (mejorar hospitales y servicios de salud 10%) que también afectan el poder adquisitivo inmediato.
Dado también que con poder adquisitivo se puede acceder a la educación privada y que los resultados de la educación toman mucho tiempo en madurar, la educación está lejos de ser un problema de subsistencia cuando es comparado con las otras 10 preocupaciones.
Cabe preguntarse por ejemplo: 1) Está el 97% de la población está recibiendo agua potable en cantidad, entrega y calidad en estos momentos? 2) Está el 96% de la población conforme en no controlar la inmigración haitiana?
Lo que no es evidente es que la solución de los problemas de largo plazo, de energía y educación, resuelven los problemas del poder adquisitivo de la población. Posponer la solución de esos dos problemas cruciales seguirá sumiéndonos en la pobreza. Con educación y poder adquisitivo es mucho más fácil resolver el problema de la corrupción.
El titular del periódico EL DIA sobre la encuesta Hamilton/EL DIA llama poderosamente la atención: “Corrupción sólo preocupa a un 5% de la población: Apenas 2 de cada cien piensan que educación es un problema prioritario.”
Es importante buscar las creencias en que descansan esas estadísticas y mucho más el diseño de la encuesta. Mirando la noticia bajo la firma de José P. Monegro, salen a relucir tres suposiciones importantes que enmarcan la pregunta: la pregunta misma, las posibles respuestas y el hecho que la población debía identificar una o dos de sus muchas preocupaciones.
La pregunta fue ¿Cuál de estos asuntos, cree usted, que es el más importante a ser tratado por el próximo gobierno? Todos sabemos que el próximo gobierno deberá tratar mucho más de un asunto.
Como tanto las respuestas “otro (especifique) y “no sabe” no aportaron nada en la encuesta, puede decirse que el diseño aporta que son solamente 11 las grandes preocupaciones de la población dominicana. La respuesta entonces es que el gobierno debería concentrarse en resolver no uno, o dos (como aparece en la encuesta como opciones combinadas), sino todos esos 11 problemas, algunos a corto plazo y otros a largo plazo, iniciando los esfuerzos simultáneamente. Es evidente que energía, agua y educación son tres grandes problemas a largo plazo que facilitarán minimizar eventualmente los de corto plazo.
Es evidente que el diseño de la encuesta influenció a que la población le diera mayor énfasis a los problemas de corto plazo “vinculados a la economía personal,” como dice Monegro. Dado que la creación de fuentes de trabajo y la reducción de los precios de los productos de primera necesidad tienen un impacto crucial e inmediato en el poder adquisitivo de las familias, no es de extrañarse que hayan sido seleccionadas como la primera y la segunda preocupación.
Dado que el gobierno ha invertido de manera excesiva en subsidios que no son sostenibles en energía, no es de extrañar que se haya invertido el problema de la electricidad (reducción de los apagones en 6% ) y la mejora de la salud (mejorar hospitales y servicios de salud 10%) que también afectan el poder adquisitivo inmediato.
Dado también que con poder adquisitivo se puede acceder a la educación privada y que los resultados de la educación toman mucho tiempo en madurar, la educación está lejos de ser un problema de subsistencia cuando es comparado con las otras 10 preocupaciones.
Cabe preguntarse por ejemplo: 1) Está el 97% de la población está recibiendo agua potable en cantidad, entrega y calidad en estos momentos? 2) Está el 96% de la población conforme en no controlar la inmigración haitiana?
Lo que no es evidente es que la solución de los problemas de largo plazo, de energía y educación, resuelven los problemas del poder adquisitivo de la población. Posponer la solución de esos dos problemas cruciales seguirá sumiéndonos en la pobreza. Con educación y poder adquisitivo es mucho más fácil resolver el problema de la corrupción.
domingo, abril 06, 2008
Acelerando Acceso a Cuenta del Milenio
© 2008. José Antonio Vanderhorst Silverio, Ph.D.
De acuerdo a una noticia del Listín Diario, de los “casi 1,000 millones de dólares” autorizados por los Estados Unidos en DR-CAFTA, “La nueva cuenta MCA busca recompensar las decisiones correctas de políticas que apoyen el desarrollo económico y reduzcan la pobreza.”
Considerando seriamente la nota Abramos Brecha Progreso con DR-CAFTA, la electricidad sin control de precios (EWPC) es una decisión correcta que aumentaría significativamente la transparencia (lo opuesto a la corrupción) en el sector eléctrico, reduciría en breve plazo a cifras manejables los subsidios, lo que a su vez aumentaría los fondos presupuestarios para salud y educación y por ende facilitaría que el país acceda a dichos recursos lo más pronto posible. Al respecto, sugerimos la nota Electricidad para el Nuevo Milenio, que contrasta sucintamente las inmensas desventajas del viejo paradigma y las grandes oportunidades de la EWPC para tomar la delantera y así reducir la pobreza.
De acuerdo a JOSÉ SIGNORET, director de la Oficina del Fortalecimiento de Capacitación Comercial (TCB) de la Oficina del Representante Comercial de los Estados Unidos (USTR), Estados Unidos descalifica a RD para fondos Cuenta del Milenio. Argumentan que “continúan sin poder acceder a los fondos que otorga el gobierno norteamericano a los países en desarrollo para enfrentar los desafíos de la pobreza mediante la Cuenta del Milenio, al no cumplir con indicadores de gobernabilidad, corrupción y mejora de la calidad de vida de la población.”
Los indicadores sobre gobernabilidad, corrupción y mejora de la calidad de vida de la población, pueden cambiar grandemente si los líderes verdaderos del sector privado dominicano desarrollan la acción voluntaria sugerida para abrir la brecha concentrándose en el aspecto de educación para el liderazgo, dejando que el gobierno concentre su atención en la salud y en los demás aspectos de educación. A futuro la gente solo podrá realizar una sola clase de trabajo que le garantice salarios llevaderos, prácticas de trabajo justas, y la protección ambiental necesaria para desafiar la pobreza.
Como a nivel global, los trabajos que puedan ser automatizados serán automatizados, solamente los trabajos de liderazgo garantizarán que su titular tome cargo de su salud, lo que hace falta es una educación complementaria orientada al liderazgo en toda la población. El mejor lugar para ofrecer esa educación de liderazgo es en las propias empresas del sector privado, por medio de una campaña en cadena similar a las de alfabetización, con los superiores respectivos a cargo de la educación de los subalternos. Esa campaña tiene el potencial de generar un círculo virtuoso de reducción de la pobreza en toda la sociedad al tiempo que garantiza mejores niveles de rentabilidad en las mismas empresas.
Signoret también “Dijo que República Dominicana no puede acceder a los fondos porque tiene que cumplir algunos criterios para ser elegible a la Cuenta del Milenio y con indicadores sobre corrupción, inversión en salud y educación, ‘que son en los que República Dominicana tiene las mayores dificultades relativo a los criterios de selección’”.
De acuerdo a una noticia del Listín Diario, de los “casi 1,000 millones de dólares” autorizados por los Estados Unidos en DR-CAFTA, “La nueva cuenta MCA busca recompensar las decisiones correctas de políticas que apoyen el desarrollo económico y reduzcan la pobreza.”
Considerando seriamente la nota Abramos Brecha Progreso con DR-CAFTA, la electricidad sin control de precios (EWPC) es una decisión correcta que aumentaría significativamente la transparencia (lo opuesto a la corrupción) en el sector eléctrico, reduciría en breve plazo a cifras manejables los subsidios, lo que a su vez aumentaría los fondos presupuestarios para salud y educación y por ende facilitaría que el país acceda a dichos recursos lo más pronto posible. Al respecto, sugerimos la nota Electricidad para el Nuevo Milenio, que contrasta sucintamente las inmensas desventajas del viejo paradigma y las grandes oportunidades de la EWPC para tomar la delantera y así reducir la pobreza.
De acuerdo a JOSÉ SIGNORET, director de la Oficina del Fortalecimiento de Capacitación Comercial (TCB) de la Oficina del Representante Comercial de los Estados Unidos (USTR), Estados Unidos descalifica a RD para fondos Cuenta del Milenio. Argumentan que “continúan sin poder acceder a los fondos que otorga el gobierno norteamericano a los países en desarrollo para enfrentar los desafíos de la pobreza mediante la Cuenta del Milenio, al no cumplir con indicadores de gobernabilidad, corrupción y mejora de la calidad de vida de la población.”
Los indicadores sobre gobernabilidad, corrupción y mejora de la calidad de vida de la población, pueden cambiar grandemente si los líderes verdaderos del sector privado dominicano desarrollan la acción voluntaria sugerida para abrir la brecha concentrándose en el aspecto de educación para el liderazgo, dejando que el gobierno concentre su atención en la salud y en los demás aspectos de educación. A futuro la gente solo podrá realizar una sola clase de trabajo que le garantice salarios llevaderos, prácticas de trabajo justas, y la protección ambiental necesaria para desafiar la pobreza.
Como a nivel global, los trabajos que puedan ser automatizados serán automatizados, solamente los trabajos de liderazgo garantizarán que su titular tome cargo de su salud, lo que hace falta es una educación complementaria orientada al liderazgo en toda la población. El mejor lugar para ofrecer esa educación de liderazgo es en las propias empresas del sector privado, por medio de una campaña en cadena similar a las de alfabetización, con los superiores respectivos a cargo de la educación de los subalternos. Esa campaña tiene el potencial de generar un círculo virtuoso de reducción de la pobreza en toda la sociedad al tiempo que garantiza mejores niveles de rentabilidad en las mismas empresas.
Signoret también “Dijo que República Dominicana no puede acceder a los fondos porque tiene que cumplir algunos criterios para ser elegible a la Cuenta del Milenio y con indicadores sobre corrupción, inversión en salud y educación, ‘que son en los que República Dominicana tiene las mayores dificultades relativo a los criterios de selección’”.
Asking Ken Silverstein for Help
Dear Mr. Silverstein,
Your post The Mission Statement is very objective, interesting and useful. All of your posts have enlightened my curiosity on good journalism. I think that my humble work on electricity without price controls (EWPC) deserves your help to be “read by a wide swath of interests.” To get a quick idea, please consider the GMH essay Electricity for the New Millennium.
There are now more than 100 EWPC articles on EnergyBlogs.com. Can you help by writing a professional journalistic article on EWPC? Please continue your assetment by considering the most recent articles EWPC’s Tipping Point and its follow up I Have a Dream Too.
As “… the columns both deserve and need to be critiqued,” I don’t understand the point in your statement “I’m not trying to appeal to or anger any one constituency.” I don’t understand it because, to me, it contradicts what you affirmed about dialogues in your post Journalism 101: “… it is my most sincere intention to be able to reach readers and to make them thirst for more information -- to, in essence, be a catalyst for more dialogue.” My point is that now people can learn from the emergent future, via generative dialogues that expose very rich conflicts, that might anger constituencies, such as can be seen in the EWPC article The Good, the Bad and the Ugly.
From your post Packing Heat, I envision that EWPC “… battle to persuade the general public and ultimately Congress needs to take place in the marketplace of ideas. That discussion should not be censored in any way….” At it happens “… the lobbyists representing the various stakeholders are all roaming the halls of Congress trying to win support for their causes,” but the EWPC cause, that goes against the conventional wisdom, that emerged at the beginning of last year has not been considered at all.
In contrast to your post Trading Mentality, I am concerned of the utilities shareholders (people), to read “… there never has been and nor will there ever be any excuse for the shenanighans that [stopped] … the traders ... A few people [in the utilities] got very rich [by stopping progress in order no take risks at all]. But, the whole episode dragged down just about everyone else . . . it's important to punish those who lost their morality to avoid another era that [still] runs totally amok.” Consider please the EWPC article High Leverage Shake-Up in California.
On your post A Little Humility, you wrote that “Enron may have been ‘important,’ but -- eventually -- in my eyes it was just some faceless company that had no humility.” Would it be possible that Enron was just a very greedy casualty of several “faceless company [read California utilities] that had [even less] humility.”? Going back to 1996, before the debacle, please consider the EWPC article Slicing the Last of the Regulated Monopolies, which is an update of a New York Times article, by McKinsey & Co, director, Lester P. Silverman.
On that last post, I am 100 percent with your statement “What's that ole saying? You better be kind to people on the way up because you are going to see them on the way down. I take no pleasure in watching anyone's downfall, much less the fall of an entire company and all the implications that come with that. But, it really didn't surprise to me to learn that its success had really been a facade and that the company name eventually became synonymous with corruption.”
Best regards,
José Antonio Vanderhorst-Silverio, Ph.D.
Your post The Mission Statement is very objective, interesting and useful. All of your posts have enlightened my curiosity on good journalism. I think that my humble work on electricity without price controls (EWPC) deserves your help to be “read by a wide swath of interests.” To get a quick idea, please consider the GMH essay Electricity for the New Millennium.
There are now more than 100 EWPC articles on EnergyBlogs.com. Can you help by writing a professional journalistic article on EWPC? Please continue your assetment by considering the most recent articles EWPC’s Tipping Point and its follow up I Have a Dream Too.
As “… the columns both deserve and need to be critiqued,” I don’t understand the point in your statement “I’m not trying to appeal to or anger any one constituency.” I don’t understand it because, to me, it contradicts what you affirmed about dialogues in your post Journalism 101: “… it is my most sincere intention to be able to reach readers and to make them thirst for more information -- to, in essence, be a catalyst for more dialogue.” My point is that now people can learn from the emergent future, via generative dialogues that expose very rich conflicts, that might anger constituencies, such as can be seen in the EWPC article The Good, the Bad and the Ugly.
From your post Packing Heat, I envision that EWPC “… battle to persuade the general public and ultimately Congress needs to take place in the marketplace of ideas. That discussion should not be censored in any way….” At it happens “… the lobbyists representing the various stakeholders are all roaming the halls of Congress trying to win support for their causes,” but the EWPC cause, that goes against the conventional wisdom, that emerged at the beginning of last year has not been considered at all.
In contrast to your post Trading Mentality, I am concerned of the utilities shareholders (people), to read “… there never has been and nor will there ever be any excuse for the shenanighans that [stopped] … the traders ... A few people [in the utilities] got very rich [by stopping progress in order no take risks at all]. But, the whole episode dragged down just about everyone else . . . it's important to punish those who lost their morality to avoid another era that [still] runs totally amok.” Consider please the EWPC article High Leverage Shake-Up in California.
On your post A Little Humility, you wrote that “Enron may have been ‘important,’ but -- eventually -- in my eyes it was just some faceless company that had no humility.” Would it be possible that Enron was just a very greedy casualty of several “faceless company [read California utilities] that had [even less] humility.”? Going back to 1996, before the debacle, please consider the EWPC article Slicing the Last of the Regulated Monopolies, which is an update of a New York Times article, by McKinsey & Co, director, Lester P. Silverman.
On that last post, I am 100 percent with your statement “What's that ole saying? You better be kind to people on the way up because you are going to see them on the way down. I take no pleasure in watching anyone's downfall, much less the fall of an entire company and all the implications that come with that. But, it really didn't surprise to me to learn that its success had really been a facade and that the company name eventually became synonymous with corruption.”
Best regards,
José Antonio Vanderhorst-Silverio, Ph.D.
sábado, abril 05, 2008
Electricidad para el Nuevo Milenio
Ensayo original 2008 (c) de José Antonio Vanderhorst-Silverio, Ph.D.
El ahora obsoleto modelo de negocios de la empresa eléctrica verticalmente integrada, de ganar casos de tarifas al regulador funcionó hasta los años 70, porque los costes de electricidad de los clientes se reducían año tras año, pues el combustible era barato y los costes de las transacciones de los clientes al por menor eran prohibidos. Dado que los clientes podrían ser clasificados en segmentos de mercado bien definidos, para evitar altos costos de transacción, el regulador se convirtió en un intermediario autonombrado para comprar electricidad al por mayor. Ese paradigma de la Segunda Revolución industrial ya no funciona.
En la tercera Revolución Industrial que estamos viviendo hoy, la situación antedicha se ha invertido: los costes energéticos están prohibitivos y los costes de las transacciones de los clientes al por menor se reducen año tras año. El regulador como intermediario ahora produce gastos indirectos innecesarios, pues la opinión de los clientes en el valor de la electricidad varía extensamente. Ambos cambios están permitiendo un nuevo paradigma que permita la liberalización de los mercados de la electricidad, así que los clientes tengan libertad de elección, precios justos y eficientes, mientras que el sistema eléctrico se planea, se gestiona y se controla con eficacia con la respuesta de los clientes habilitada por la tecnología.
El paradigma de la electricidad sin control de precios (EWPC) implica dos mercados que se refuerzan mutuamente: 1) un mercado controlado del transporte, cuyo acuerdo se basa en la responsabilidad de transportar, y 2) un mercado (al por menor y al por mayor) robusto, completo, abierto, y completamente funcional, donde la responsabilidad de servir sea conforme a acuerdos que deben habilitar el bienestar social máximo, bajo regulaciones prudenciales similares a las de la industria financiera.
En la tercera Revolución industrial, el viejo modelo de negocios de ganarles caso de tarifas al regulador depende enteramente de riesgos elevados de parte del regulador; las apuestas a los proyectos de las empresas eléctricas entrarán las estructuras de tarifas. "Sin embargo, bajo el paradigma de la arquitectura y del diseño del mercado de la brecha EWPC, " … los gastos indirectos de ambas empresas eléctricas y del regulador se eliminan, " y los minoristas (una nueva casta de segunda generación) compiten a su propio riesgo (ni del cliente, ni del contribuyente de impuestos) en varios segmentos de mercado mundiales en que intentan desarrollar modelos de negocio innovadores, como se hace en muchas otras industrias.
Para permitir la revolución verde de la tecnología, según lo previsto por “el famoso del capital de riesgo,” Juan Doerr, es muy importante dar una fuerte mirada al paradigma que abre la brecha de la arquitectura y del diseño del mercado en www.energyblogs.com/ewpc
El ahora obsoleto modelo de negocios de la empresa eléctrica verticalmente integrada, de ganar casos de tarifas al regulador funcionó hasta los años 70, porque los costes de electricidad de los clientes se reducían año tras año, pues el combustible era barato y los costes de las transacciones de los clientes al por menor eran prohibidos. Dado que los clientes podrían ser clasificados en segmentos de mercado bien definidos, para evitar altos costos de transacción, el regulador se convirtió en un intermediario autonombrado para comprar electricidad al por mayor. Ese paradigma de la Segunda Revolución industrial ya no funciona.
En la tercera Revolución Industrial que estamos viviendo hoy, la situación antedicha se ha invertido: los costes energéticos están prohibitivos y los costes de las transacciones de los clientes al por menor se reducen año tras año. El regulador como intermediario ahora produce gastos indirectos innecesarios, pues la opinión de los clientes en el valor de la electricidad varía extensamente. Ambos cambios están permitiendo un nuevo paradigma que permita la liberalización de los mercados de la electricidad, así que los clientes tengan libertad de elección, precios justos y eficientes, mientras que el sistema eléctrico se planea, se gestiona y se controla con eficacia con la respuesta de los clientes habilitada por la tecnología.
El paradigma de la electricidad sin control de precios (EWPC) implica dos mercados que se refuerzan mutuamente: 1) un mercado controlado del transporte, cuyo acuerdo se basa en la responsabilidad de transportar, y 2) un mercado (al por menor y al por mayor) robusto, completo, abierto, y completamente funcional, donde la responsabilidad de servir sea conforme a acuerdos que deben habilitar el bienestar social máximo, bajo regulaciones prudenciales similares a las de la industria financiera.
En la tercera Revolución industrial, el viejo modelo de negocios de ganarles caso de tarifas al regulador depende enteramente de riesgos elevados de parte del regulador; las apuestas a los proyectos de las empresas eléctricas entrarán las estructuras de tarifas. "Sin embargo, bajo el paradigma de la arquitectura y del diseño del mercado de la brecha EWPC, " … los gastos indirectos de ambas empresas eléctricas y del regulador se eliminan, " y los minoristas (una nueva casta de segunda generación) compiten a su propio riesgo (ni del cliente, ni del contribuyente de impuestos) en varios segmentos de mercado mundiales en que intentan desarrollar modelos de negocio innovadores, como se hace en muchas otras industrias.
Para permitir la revolución verde de la tecnología, según lo previsto por “el famoso del capital de riesgo,” Juan Doerr, es muy importante dar una fuerte mirada al paradigma que abre la brecha de la arquitectura y del diseño del mercado en www.energyblogs.com/ewpc
Electricity for the New Millennium
Original 2008 essay by (c) José Antonio Vanderhorst-Silverio, Ph.D.
The now obsolete Vertically Integrated Utility business model, of winning rate cases to the regulator worked until the 70’s, because customers' electricity costs were going down year after year, as fuel was cheap and retail customers' transactions costs were prohibited. As customers could be classified in neat market segments, to avoid the high transaction costs, the regulator became a self-appointed intermediary to purchase electricity at wholesale. That paradigm of the Second Industrial Revolution just doesn't work anymore.
In the Third Industrial Revolution that we are living today, the above situation has reversed: energy costs are becoming prohibited and retail customers' transactions costs are going down year after year. The regulator as an intermediary is now an unnecessary overhead, as customers' perception on electricity's value vary widely. Both of those changes are enabling a new paradigm that allows the liberalization of electricity markets, so customers have freedom of choice, fair and efficient prices, while the power system is planned, operated and controlled effectively with the response of the customers enabled by technology.
The electricity without price controls (EWPC) paradigm involves two markets that mutually reinforce themselves: 1) a controlled transportation market, whose compact is based on the responsibility to transport, and 2) a robust, complete, open, and fully functional (retail and wholesale) market, where the responsibility to serve is subject to agreements that should enable the maximum social welfare, under prudential regulations similar to those of the financial industry.
In the Third Industrial Revolution, the old business model of winning rate case to the regulator depends entirely on very risky regulator "bets on utilities projects that will go into the rates structure." However, under the breakthrough EWPC market architecture and design paradigm, "... the layers of overhead of both utilities and the regulator are removed," and (a new breed of Second Generation) Retailers compete at their own risk (neither at the ratepayer, nor taxpayer) in several worldwide market segments trying to develop business model innovations, as business do in many other industries.
To enable the green tech revolution, as envisioned by “VC bigshot” John Doerr, it is very important to take a hard look winning breakthrough market architecture and design paradigm at www.energyblogs.com/ewpc
Note: I live in the Dominican Republic.
The now obsolete Vertically Integrated Utility business model, of winning rate cases to the regulator worked until the 70’s, because customers' electricity costs were going down year after year, as fuel was cheap and retail customers' transactions costs were prohibited. As customers could be classified in neat market segments, to avoid the high transaction costs, the regulator became a self-appointed intermediary to purchase electricity at wholesale. That paradigm of the Second Industrial Revolution just doesn't work anymore.
In the Third Industrial Revolution that we are living today, the above situation has reversed: energy costs are becoming prohibited and retail customers' transactions costs are going down year after year. The regulator as an intermediary is now an unnecessary overhead, as customers' perception on electricity's value vary widely. Both of those changes are enabling a new paradigm that allows the liberalization of electricity markets, so customers have freedom of choice, fair and efficient prices, while the power system is planned, operated and controlled effectively with the response of the customers enabled by technology.
The electricity without price controls (EWPC) paradigm involves two markets that mutually reinforce themselves: 1) a controlled transportation market, whose compact is based on the responsibility to transport, and 2) a robust, complete, open, and fully functional (retail and wholesale) market, where the responsibility to serve is subject to agreements that should enable the maximum social welfare, under prudential regulations similar to those of the financial industry.
In the Third Industrial Revolution, the old business model of winning rate case to the regulator depends entirely on very risky regulator "bets on utilities projects that will go into the rates structure." However, under the breakthrough EWPC market architecture and design paradigm, "... the layers of overhead of both utilities and the regulator are removed," and (a new breed of Second Generation) Retailers compete at their own risk (neither at the ratepayer, nor taxpayer) in several worldwide market segments trying to develop business model innovations, as business do in many other industries.
To enable the green tech revolution, as envisioned by “VC bigshot” John Doerr, it is very important to take a hard look winning breakthrough market architecture and design paradigm at www.energyblogs.com/ewpc
Note: I live in the Dominican Republic.
viernes, abril 04, 2008
I Have a Dream Too
In memory of Dr. Martin Luther King. EWPC is about the liberalization of electricity markets, so customers have freedom of choice, fair and efficient prices, while the power system is planned, operated and controlled effectively. Having now available EWPC’s Tipping Point, we are about to enable electricity for the third industrial revolution with a modern global electricity rights movement (see Global Citizens' Call to Arms).
I Have a Dream Too
By José Antonio Vanderhorst-Silverio, Ph.D.
Systemic Consultant: Electricity
First posted in the GMH Blog, on April 4th, 2008.
Copyright © 2008 José Antonio Vanderhorst-Silverio. All rights reserved. No part of this article may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopying and recording, without written permission from José Antonio Vanderhorst-Silverio. This article is an unedited, an uncorrected, draft material of The EWPC Textbook. Please write to javs@ieee.org to contact the author for any kind of engagement.
In memory of Dr. Martin Luther King, one of the most prominent leaders of the modern civil rights movement in the United States.
Electricity Without Price Controls (EWPC) is about the liberalization of electricity markets, so customers have freedom of choice, fair and efficient prices, while the power system is planned, operated and controlled effectively. An expert told me long ago that “putting this idea into practice is indeed very complicated.” Having now available EWPC’s Tipping Point, we are about to enable electricity for the third industrial revolution with a modern global electricity rights movement (see the EWPC article Global Citizens' Call to Arms).
Following the article ITER and the Mother Lode, by Martin Rosenberg - From the Editor's Desk Blog, I went to Fast Company and read the article “The Mother Lode,” by Fred Krupp. After quoting “VC bigshot” John Doerr about the boom in Green Tech: “We’re talking about nothing less than the reindustrialization of the whole planet,” Fred adds “So the biggest mistake any investor or company could make would be to remain inside the Valley’s rarified air, ignoring the incumbent energy companies that control distribution, have near total market share, and shape regulations to their benefit.” Doerr calls Green Tech the “mother of all markets.” This statement describes the barrier created by The BIG California LIE.
In the recent discussions on EnegyPulse and EnergyBlogs.com and posted under several EWPC articles, after running out of arguments against the EWPC market architecture and design paradigm Don Giegler had written “Weren't you describing your effort to convince critics like me that EWPC is not a pipe dream?,” Bob Amorosi wrote: “I really suspect your EWPC proposal is a pipe dream at best,” and Len Gould wrote “Happy Dreams.”
Back in October 2005, in response to the same position (see Re: Soñar no Cuesta Nada - I have a Dream too), I wrote the following to Dominicans;
Just as Martin Luther King Jr. said I have a Dream, so I have a Dream too:
I Have a Dream Too
By José Antonio Vanderhorst-Silverio, Ph.D.
Systemic Consultant: Electricity
First posted in the GMH Blog, on April 4th, 2008.
Copyright © 2008 José Antonio Vanderhorst-Silverio. All rights reserved. No part of this article may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopying and recording, without written permission from José Antonio Vanderhorst-Silverio. This article is an unedited, an uncorrected, draft material of The EWPC Textbook. Please write to javs@ieee.org to contact the author for any kind of engagement.
In memory of Dr. Martin Luther King, one of the most prominent leaders of the modern civil rights movement in the United States.
Electricity Without Price Controls (EWPC) is about the liberalization of electricity markets, so customers have freedom of choice, fair and efficient prices, while the power system is planned, operated and controlled effectively. An expert told me long ago that “putting this idea into practice is indeed very complicated.” Having now available EWPC’s Tipping Point, we are about to enable electricity for the third industrial revolution with a modern global electricity rights movement (see the EWPC article Global Citizens' Call to Arms).
Following the article ITER and the Mother Lode, by Martin Rosenberg - From the Editor's Desk Blog, I went to Fast Company and read the article “The Mother Lode,” by Fred Krupp. After quoting “VC bigshot” John Doerr about the boom in Green Tech: “We’re talking about nothing less than the reindustrialization of the whole planet,” Fred adds “So the biggest mistake any investor or company could make would be to remain inside the Valley’s rarified air, ignoring the incumbent energy companies that control distribution, have near total market share, and shape regulations to their benefit.” Doerr calls Green Tech the “mother of all markets.” This statement describes the barrier created by The BIG California LIE.
In the recent discussions on EnegyPulse and EnergyBlogs.com and posted under several EWPC articles, after running out of arguments against the EWPC market architecture and design paradigm Don Giegler had written “Weren't you describing your effort to convince critics like me that EWPC is not a pipe dream?,” Bob Amorosi wrote: “I really suspect your EWPC proposal is a pipe dream at best,” and Len Gould wrote “Happy Dreams.”
Back in October 2005, in response to the same position (see Re: Soñar no Cuesta Nada - I have a Dream too), I wrote the following to Dominicans;
Just as Martin Luther King Jr. said I have a Dream, so I have a Dream too:
It would be fatal for the nation to overlook the urgency of the moment and to underestimate the determination of the Customer. This sweltering summer of the Customer's legitimate discontent will not pass until there is an invigorating autumn of freedom and equality. Two thousand and five is not an end, but a beginning. Those who hope that the Customer needed to blow off steam and will now be content will have a rude awakening if the nation returns to business as usual. There will be neither rest nor tranquility in Dominicana until the electricity Customer is granted his citizenship rights.
I have a dream that one day this nation will rise up and live out the true meaning of its creed: "We hold these truths to be self-evident: that all customers are created equal." I have a dream that one day on the barrios of Santo Domingo the Customers with secure service and those with lots of blackouts will be able to have the kind of service they can afford. I have a dream that one day even the Dominican Republic, a failed state, sweltering with the heat of injustice and oppression, will be transformed into an oasis of freedom and justice. I have a dream that my three children will one day live in a nation where they will not be judged by the passaport they carry but by the content of their character. I have a dream today.
jueves, abril 03, 2008
Voto en Blanco y Voto Revocatorio
Dos fórmulas que me gustan
Tomado de los Buenos Días del Dr. Rafael Molina Morillo
Sé que es un pleito perdido, pero tengo que echarlo, si he de ser fiel a mis convicciones.
Me refiero al pedido de ciertas congregaciones evangélicas para que se pueda votar en blanco cuando ninguno de los candidatos presidenciales sea del agrado del ciudadano sufragante. Basándose en argumentos legalistas, la Junta Central Electoral se negó a validar dicha pretensión.
Pero a mí, repito, me gusta la idea del voto en blanco porque el mismo me da la oportunidad de decirle al que gane y al que pierda, que ninguno de los dos, o de los tres, o de los cuatro, me gusta.
También se puede dar el caso de que una mayoría de personas vote en blanco, y por lo tanto el gobierno que resulte de una votación así, no sería representativo.
Otra formula que me gusta en material electoral es la del voto revocatorio, que consiste en el derecho que asiste al pueblo para, a mitad de período, cambiar al gobierno si éste no ha cumplido cabalmente con las espectativas creadas. Así es en Venezuela, por ejemplo.
Insertar estas modalidades en nuestra legislación puede parecer un sueño. Pero como sonar no cuesta nada, aquí dejo la idea para quien quiera acompañarme en mi paseo por los predios de Morfeo. ¡Sean todos bienvenidos al mundo del ensueño!
Tomado de los Buenos Días del Dr. Rafael Molina Morillo
Sé que es un pleito perdido, pero tengo que echarlo, si he de ser fiel a mis convicciones.
Me refiero al pedido de ciertas congregaciones evangélicas para que se pueda votar en blanco cuando ninguno de los candidatos presidenciales sea del agrado del ciudadano sufragante. Basándose en argumentos legalistas, la Junta Central Electoral se negó a validar dicha pretensión.
Pero a mí, repito, me gusta la idea del voto en blanco porque el mismo me da la oportunidad de decirle al que gane y al que pierda, que ninguno de los dos, o de los tres, o de los cuatro, me gusta.
También se puede dar el caso de que una mayoría de personas vote en blanco, y por lo tanto el gobierno que resulte de una votación así, no sería representativo.
Otra formula que me gusta en material electoral es la del voto revocatorio, que consiste en el derecho que asiste al pueblo para, a mitad de período, cambiar al gobierno si éste no ha cumplido cabalmente con las espectativas creadas. Así es en Venezuela, por ejemplo.
Insertar estas modalidades en nuestra legislación puede parecer un sueño. Pero como sonar no cuesta nada, aquí dejo la idea para quien quiera acompañarme en mi paseo por los predios de Morfeo. ¡Sean todos bienvenidos al mundo del ensueño!
domingo, marzo 30, 2008
EWPC’s Tipping Point
Aiming to be an irresistible article, it should help start a word-of-mouth epidemic of high proportions in the power industry. By respectfully exposing, and responding inquiries, the insidious power of IMEUC False Facts to obstruct progress, it is one of those little things that can make a big difference. Now all stakeholders will be able to learn how Demand Integration to power system planning, operation and control, brings the clarity and direction of the breakthough EWPC market architecture and design paradigm shift to produce large coordination savings for society as a whole. I repeat that “California has a great opportunity to repair the damages of the BIG California LIE to the world.”
EWPC’s Tipping Point
By José Antonio Vanderhorst-Silverio, Ph.D.
Systemic Consultant: Electricity
First posted in the GMH Blog, on March 30th, 2008.
Copyright © 2008 José Antonio Vanderhorst-Silverio. All rights reserved. No part of this article may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopying and recording, without written permission from José Antonio Vanderhorst-Silverio. This article is an unedited, an uncorrected, draft material of The EWPC Textbook. Please write to javs@ieee.org to contact the author for any kind of engagement.
Aiming to be an irresistible article, this article should help start an epidemic of high proportions in the power industry. Malcolm Gladwell’s book, “The Tipping Point: How Little Things Can Make a Big Difference,” can help us see how exposing IMEUC False Facts respectfully, is one of those little things that can make a big difference.
Now the word-of-mouth epidemic can start, once people recognize the insidious power of the False Facts, which are being use by at least two exceptional, intelligent and important individuals, to obstruct progress. Now all stakeholders will be able to learn how Demand Integration brings the clarity and direction of the EWPC market architecture and design paradigm shift.
Steve Covey in his book “Seven Habits of Highly Effective People,” has described three modes of communications (trust and cooperation): 1st level (low trust, low cooperation), Defensive (Win/Lose or Lose/Win) mode; 2nd level, Respectful (Compromise) mode; and 3rd level (high trust, high cooperation), Synergistic (Win/Win) mode. When the other parties are in a defensive mode, or in very polite respectful mode, the solution to the systemic crisis of the electricity industry is delayed as the status quo remains in force.
The generative dialogue is the synergistic mode, when sometimes a new whole emerges, being greater than the sum of its parts. During the last two years and a half, many people have helped EWPC emerge. During the course of that time lapse, an alternative meter centered “market” (physical) proposition has been defended by Len Gould on the first, second and third level of communication. The article IMEUC False Facts, was a response to Len’s recent opinions under the article A Fresh Approach to Managing Peak Demand. Len accepted to participate in the generative dialogue in 2006, under the article Playing with Fire - The 10 Tcf/year Supply Gap -- Part I, which ended when I summirized previous post with the convincing post:
Len ended that generative dialogue participation retracting (since then, he has retracted many, many other times) with:
The promised article, which he could have written in EnergyBlogs, never came. But that article was, since then, no longer needed, as EWPC emerged as early as the beginning of 2007, as the winner of the market vs. market competition.
As an exceptional discussant, apparently defending the California utilities, Don Giegler has been against the idea or the possibility of a generative dialogue (synergistic trust and cooperation). The most insidious of all of the False Facts is The BIG California LIE (an EWPC article written to Don), under which the whole world was convinced that Retail Competition (which at the time seemed a little thing) is not one of the three essential requirements of electricity markets for the third industrial revolution.
In response to that highly insidious False Fact, the summary of the EWPC article High Leverage Shake-Up in California suggests that “California has a great opportunity to repair the damages of the BIG California LIE to the world. The CPUC can do it by introducing a high leverage shake-up of the power industry that results in a win-win proposition for every stakeholder, becoming the example of indiscriminate access of electricity for the third industrial revolution.”
Don inquired into the article IMEUC False Facts. I have changed his four inquiries as True Facts and presented the corresponding response under each one.
True Fact 1.) "...system crashes are mitigated by a least cost mix of supply and demand risk management tools that may be applied in time and space..." and "...DR is the key to segmentation of customers supply security..."
In the vertically integrated utilities paradigm, "...system crashes are mitigated by a least cost mix of supply [side] risk management tools that [are] applied in time and space..." Such mix is the result of power system expansion planning and executed by system security operations planning. In order to forgo and/or delay investments in generation, transmission and distribution, demand side risk management tools are added to the mix. As customers reliability needs vary over a wide range, segmentation can be part of business model innovations by dividing the range into market segments, according to the value added, just as it is done by marketers everywhere. Customers will select which part of their demand is able to respond in a given market segment.
True Fact 2.)"...my assumption the default service will have essentially all the free-riders subsidized by peers..."
The support is in the EWPC article No Need for Regulated Price Caps - II , where I wrote the following:
(Emergent) True Fact 3.)"...essential business requirements as the breakthrough tipping point to promote leadership..."
Demand Integration is the key to the tipping point. I write that it is emergent, because in the future, people will say that they had though of it. See the article EWPC Leadership (w/o links), where I wrote:
True Fact 4.)"...agents have to be able to negotiate around issues of scarcity and value..."
This true fact complements the value added by customer segmentation according to the demand response to scarcity. The true fact can be explained by the idea of EWPC “rational rationing,” as can be seen in a comment under the EWPC article The Good, the Bad and the Ugly, as a reponse to Don post that said: "So much for "generative dialogue"! It must be in the throes of "rational rationing".
EWPC’s Tipping Point
By José Antonio Vanderhorst-Silverio, Ph.D.
Systemic Consultant: Electricity
First posted in the GMH Blog, on March 30th, 2008.
Copyright © 2008 José Antonio Vanderhorst-Silverio. All rights reserved. No part of this article may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopying and recording, without written permission from José Antonio Vanderhorst-Silverio. This article is an unedited, an uncorrected, draft material of The EWPC Textbook. Please write to javs@ieee.org to contact the author for any kind of engagement.
Aiming to be an irresistible article, this article should help start an epidemic of high proportions in the power industry. Malcolm Gladwell’s book, “The Tipping Point: How Little Things Can Make a Big Difference,” can help us see how exposing IMEUC False Facts respectfully, is one of those little things that can make a big difference.
Now the word-of-mouth epidemic can start, once people recognize the insidious power of the False Facts, which are being use by at least two exceptional, intelligent and important individuals, to obstruct progress. Now all stakeholders will be able to learn how Demand Integration brings the clarity and direction of the EWPC market architecture and design paradigm shift.
Steve Covey in his book “Seven Habits of Highly Effective People,” has described three modes of communications (trust and cooperation): 1st level (low trust, low cooperation), Defensive (Win/Lose or Lose/Win) mode; 2nd level, Respectful (Compromise) mode; and 3rd level (high trust, high cooperation), Synergistic (Win/Win) mode. When the other parties are in a defensive mode, or in very polite respectful mode, the solution to the systemic crisis of the electricity industry is delayed as the status quo remains in force.
The generative dialogue is the synergistic mode, when sometimes a new whole emerges, being greater than the sum of its parts. During the last two years and a half, many people have helped EWPC emerge. During the course of that time lapse, an alternative meter centered “market” (physical) proposition has been defended by Len Gould on the first, second and third level of communication. The article IMEUC False Facts, was a response to Len’s recent opinions under the article A Fresh Approach to Managing Peak Demand. Len accepted to participate in the generative dialogue in 2006, under the article Playing with Fire - The 10 Tcf/year Supply Gap -- Part I, which ended when I summirized previous post with the convincing post:
Generative dialogue synthesis:
Competition is divided in two phases: One) market vs market and Two) company vs company.
In Phase One all interested parties cooperate in the generative dialogue to select the emergent winning market. Phase Two is not part of the generative dialogue.
EWPC – an integral reform paradigm - is an open and robust emergent market architecture and design that divides the vertically integrated utility at modular interfaces. 1) Long run and short run system planning, operation and control natural monopoly functions are also kept integrated. 2) The T&D wires natural transport monopoly is kept integrated. 3) Supply - generation - natural competitive functions compete with each other 4) Demand - retail - natural competitive functions compete with each other. 5) Supply and demand – Megawatt/vars vs Negawatt/vars - compete with each other in time and space. Module 1 commitments on planning, operation and control are to be executed by the other modules.
Based on mechanistic thinking, IMEUC is one close and fractured strategy, like any other experienced deregulation efforts, that suggests retaining one of the key elements of retail business model innovations – the metering function – as a monopoly. The intermediary Market Manager is designed to contract base load units based on long run forecasting under uncertainty, arising from improper market signals.
IMEUC as a switchboard intermediary is just one of the many potential business models. It is only through execution – high dynamic complexity – of the development of the resources on the demand side that the potential will be realized. Other potential business model innovations won’t be able to be developed if IMEUC is unfairly and prematurely selected, by giving it market power over other intermediaries. It is no correct to assume how customers will behave – and evolve - beforehand. Instead, there is a need for a customer orientation.
While incremental costs might become negligible, sunk costs might be comparatively prohibitive for all customers. As a “right” solution, IMEUC becomes a strong barrier to emergent – high generative complexity - creative destruction. The best way to find out what the real overhead costs will be is in Phase Two with the right strategy and flawless execution under competition.
Module 1 is to take decisions for the health of the whole system as they unfold. The forward looking statement suggested to Prof. Banks and Mr. Carson on the generative dialogue goes in that direction. The Market Manager does not have such integral perspective.
I want to keep my opinions on Phase One. I am open to review the general open market design and architecture, if there are unfair elements associated with it. I have “listen” carefully to Len’s opinions and perceive that his interests, by going farther than necessary, go well beyond Phase One. Other parties representative of the larger whole – high social complexity - with different interests – regulators, generation of differing kinds, wholesale, retail, transmission, distribution, fuel supply, manufacturers of systems and equipments, etc. - are invited to participate in the generative dialogue.
© 2006. José Antonio Vanderhorst-Silverio, PhD.
Len ended that generative dialogue participation retracting (since then, he has retracted many, many other times) with:
Jose Antonio: Your cogent discussion raises some issues with IMEUC which I hope to clarify in a third article in the series here on EnergyPulse in perhaps a couple of weeks, provided I can submit it up to the high standards of the editorial staff. Thank you.”
The promised article, which he could have written in EnergyBlogs, never came. But that article was, since then, no longer needed, as EWPC emerged as early as the beginning of 2007, as the winner of the market vs. market competition.
As an exceptional discussant, apparently defending the California utilities, Don Giegler has been against the idea or the possibility of a generative dialogue (synergistic trust and cooperation). The most insidious of all of the False Facts is The BIG California LIE (an EWPC article written to Don), under which the whole world was convinced that Retail Competition (which at the time seemed a little thing) is not one of the three essential requirements of electricity markets for the third industrial revolution.
In response to that highly insidious False Fact, the summary of the EWPC article High Leverage Shake-Up in California suggests that “California has a great opportunity to repair the damages of the BIG California LIE to the world. The CPUC can do it by introducing a high leverage shake-up of the power industry that results in a win-win proposition for every stakeholder, becoming the example of indiscriminate access of electricity for the third industrial revolution.”
Don inquired into the article IMEUC False Facts. I have changed his four inquiries as True Facts and presented the corresponding response under each one.
True Fact 1.) "...system crashes are mitigated by a least cost mix of supply and demand risk management tools that may be applied in time and space..." and "...DR is the key to segmentation of customers supply security..."
In the vertically integrated utilities paradigm, "...system crashes are mitigated by a least cost mix of supply [side] risk management tools that [are] applied in time and space..." Such mix is the result of power system expansion planning and executed by system security operations planning. In order to forgo and/or delay investments in generation, transmission and distribution, demand side risk management tools are added to the mix. As customers reliability needs vary over a wide range, segmentation can be part of business model innovations by dividing the range into market segments, according to the value added, just as it is done by marketers everywhere. Customers will select which part of their demand is able to respond in a given market segment.
True Fact 2.)"...my assumption the default service will have essentially all the free-riders subsidized by peers..."
The support is in the EWPC article No Need for Regulated Price Caps - II , where I wrote the following:
In practice, however, there is need for a transition from today’s situation to EWPC. As there will be no incumbent retailers, 2GRs will need to carry the default service customers during the time limited transition period.
Nat Treadway, wrote in the article The Dawn of Electricity Competition: Efficient Prices and Efficient Choices that, “The design of default service (also called basic or standard service or provider of last resort) was identified as the most significant determinant of the success of retail electricity choice. A poorly designed default service undermines competition. If default service is designed to satisfy all residential consumers’ needs, or if it bundles and spreads risks among all consumers, or if it is priced below market, then it is unlikely that new retail electricity providers will enter the market. With few choices, consumers are left with only the poorly designed default service, and with limited benefit.”
During such a transition, 2GRs will have both types of customers (as there is no incumbent retailer), with increasing development of the resources of the demand side, as the default service will have essentially all the “free riders” being subsidized by peers. Hence, a systemic incentive to non-free riders will result, as they get the pressure for efficient prices and efficient choices. So, if only one or two [there should be many] retailers are truly competitive (2GRs), they will end up with the whole market.
(Emergent) True Fact 3.)"...essential business requirements as the breakthrough tipping point to promote leadership..."
Demand Integration is the key to the tipping point. I write that it is emergent, because in the future, people will say that they had though of it. See the article EWPC Leadership (w/o links), where I wrote:
The essence of EWPC is "the generic market model paradigm: Retail Competition, Active Demand, and Ultraquality Transportation," which includes wholesale competition, as 2GRs link both markets.
Such essence is the basis for a breakthrough, which is the tipping point that shifts paradigms permanently. The breakthrough is … the epitome of the 'AHHA!' moment bringing absolute clarity and direction… that now … comes to the power industry for both the open (retail and wholesale) market (with competitive incentives for the development of business model innovations) and the closed (transportation) market (the new utility, with a responsibility to transport).
The Old utilities paradigm (with a responsibility to serve) comes from demand as an externality (inactive demand and no competition) and has already served its purpose with its obsolete business model of winning rate case to the regulator. Each incremental extension of the Old paradigm results in unnecessary accumulated costs paid by customers and "earned" by utilities.
EWPC comes from - a different place altogether - Demand Integration (which comes from Active Demand and Retail Competition) to power system planning, operation and control by 2GRs, resulting in large coordination savings for society as a whole,
both in customers' multiyear investments and operation costs. Letting every customer for himself is a weakness in Gridwise (updated on March 27, 2008, as the Gridwise Architectural Council) that is filled by EWPC.
True Fact 4.)"...agents have to be able to negotiate around issues of scarcity and value..."
This true fact complements the value added by customer segmentation according to the demand response to scarcity. The true fact can be explained by the idea of EWPC “rational rationing,” as can be seen in a comment under the EWPC article The Good, the Bad and the Ugly, as a reponse to Don post that said: "So much for "generative dialogue"! It must be in the throes of "rational rationing".
On the need of rational rationing that competitive 2GRs will be able handle as they replace the regulated enterprise side of the utilities, Warren Causey wrote that "Here are some examples of customer concerns utilities and their CISs will have to deal with in the future (which they are not able to do, just as it is not possible to teach new tricks to an old dog) : . .. · As electricity becomes more scarce--something that is predicted by virtually everyone knowledgeable about the state of the industry--residential customers are going to have to deal with reduced supplies... As the shortages become more acute as carbon constraints continue to drive out the 50% of U.S. electricity currently generated by coal, demand response likely will have to become mandatory. When it is mandatory, it becomes rationing. . . · As demand response/rationing takes hold, utilities are going to have to know a lot more about the lifestyles of their customers. To see the complete article Customer care is about to become much more complex for utilities. Current systems can’t handle it.
viernes, marzo 28, 2008
IMEUC False Facts
Based on the article “The Power of False Facts,” readers need to be very aware of that power while reading those False Facts to be able to rate them as false. The following False Facts need to be well understood: 1) IMEUC doesn’t need to satisfy the Ultraquality Transportation requirement. 2) EWPC has a Free Rider Problem; no answers are given in mentioned article. 3) EWPC has no answers to 11 questions. 4) IMEUC operates on the Economic Level.
IMEUC False Facts
By José Antonio Vanderhorst-Silverio, Ph.D.
Systemic Consultant: Electricity
First posted in the GMH Blog, on March 28th, 2008.
Copyright © 2008 José Antonio Vanderhorst-Silverio. All rights reserved. No part of this article may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopying and recording, without written permission from José Antonio Vanderhorst-Silverio. This article is an unedited, an uncorrected, draft material of The EWPC Textbook. Please write to javs@ieee.org to contact the author for any kind of engagement.
This article is not written to attack Len Gould, nor his friends, which are very intelligent and important persons. It aims to their opinions, about some False Facts they apparently believe in and are entitled to keep them. Every time Len retracts, as a result of a False Fact becoming evident, he goes on usually with the help from friends.
I have taken a brief article “The Power of False Facts,” from the book Powerful Times (see page 41) by Eamonn Kelly. The source of the article is: Sharon Begley, “People Believe a ‘Fact’ That Fits Their Views Even if it’s Clearly False.” The Wall Street Journal, February 4, 2005. Permissions to reprint this and other quotes in earlier EWPC articles will be considered later on for the publication of the EWPC Book.
“What we remember depends on what we believe…. ‘People build mental models,’ explains Stephan Lewandowsky, a psychology professor at the University of Western Australia, Crowley. ‘By the time they receive a retraction, the original misinformation has already become an integral part of that mental model, or worldview, and disregarding it would leave the worldview a shambles.’ Therefore, he and his colleagues conclude in their paper, ‘People continue to rely on misinformation even if they demonstrably remember and understand a subsequent retraction’…. Even many of those who remember a retraction still rated the original claim as true.”
Readers need to be very careful to the insidious power while reading those False Facts to be able to rate them as false. Since the end of 2005, Len has retracted many times from False Facts that were found out. Now I will restrict myself only to four False Facts under this specific article.
A successful transformation of the power industry needs to be based on three essential requirements that I have uncovered: 1st) Active Demand, 2nd) Retail Competition and 3) Ultraquality Transportation. EWPC has emerged to satisfy all three requirements.
I used to say that the first and second requirements lead to Demand Integration to power system planning, operation and control on the open (retail and wholesale) market value chain. The third requirement leads to the transportation utility under a regulatory compact with a responsibility to transport is also a needed for Demand Integration, as can be seen next.
False Fact #1. IMEUC doesn’t need to satisfy the Ultraquality Transportation requirement. Len writes “Level of Reliability should be simply a market factor purchased as needed just like Level of Power etc.,” to justify the lack of Ultraquality transportation of IMEUC. My response was that ““Demand Integration is based on the fact [the third requirement emerges] that reliability has two sides: ‘On one side, system crashes are mitigated by a least cost mix of supply and demand risk management tools that may be applied in time and space [that is the Ultraquality Transportation requiremen]t. On the other, DR is the key to the segmentation of customers [based on the Retail Competition] supply security (a kind of insurance).’” After that, Bob came to the rescue by changing the subject. Readers should not forget that fact.
False Fact #2: EWPC has a Free Rider Problem; no answers are given in mentioned article. Len wrote “As an example of above. I invite readers to read the blog entry Jose Antonio refers to above, and evaluate in what way it constitutes an answer to my "Free Rider Problem in EWPC" question (NOT), at No Need for Regulated Price Caps - II .” As the next sequence of posts after that showed, it is very clear that the my “assumption ‘the default service will have essentially all the free riders being subsidized by peers.’" was available, right where I said, in the link of just mentioned EWPC article. Once gain, Bob changes the subject. But the lie goes on. He later tries to continue discussing the issue of free riding, but the real issue the False Fact.
False Fact #3: EWPC has no answers to 11 questions. Len writes for the third (not the second) time “My problem with EWPC are myriad eg. it's precisely identical to every existing failed attempt at de-regulation in N. America. And it's promoter flatly refuses to answer any difficult questions about it. Questions which I have posed before, such as:…” I showed a copy of each of the answers, to identify the False Fact that I had answered those questions earlier. Len takes those answers and ads new questions, but that was not the issue at hand, but a False Fact. Todd comes to help Len with an “abridge version” of the old responses – the evidence of the False Fact - as my explanation of EWPC, which in fact were on the link that I referred in my response to Ken as “Your good intentions are no longer necessary. The EWPC article EWPC Leadership (w/o links) has a better approach: that of essential business requirements, as the breakthrough tipping point to promote leadership.”
False Fact #4: IMEUC operates on the Economic Level. As “Many on the GridWise side start out with a control orientation, a continuation of the load limiting approaches most recently in the news in California’s short-lived thermostat proposals. As they work the problem, and become more aware of the complexity and diversity of the problem, they inevitably migrate more toward an agent-based approach. (Someone, I think it was Apperson Johnson, once said, “an agent is an object that can say no!”). … Eventually these agents have to be able to negotiate around the issues of scarcity and value; and of the desires of their owners. Such complex negotiations cannot be handled at the control level, but only at the economic level. This will push things toward the EWPC model.” Todd came to help Len and deviate the False Fact of IMEUC. BTW Todd is now silent and Bob followed him. In 2005 Len explained that his approach was a “prices to devices,” when he wrote “Jose: You're close…”
It is very important to understand that “Prices to Devices” has potential for being a market segment, but NO for the whole market.
IMEUC False Facts
By José Antonio Vanderhorst-Silverio, Ph.D.
Systemic Consultant: Electricity
First posted in the GMH Blog, on March 28th, 2008.
Copyright © 2008 José Antonio Vanderhorst-Silverio. All rights reserved. No part of this article may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopying and recording, without written permission from José Antonio Vanderhorst-Silverio. This article is an unedited, an uncorrected, draft material of The EWPC Textbook. Please write to javs@ieee.org to contact the author for any kind of engagement.
This article is not written to attack Len Gould, nor his friends, which are very intelligent and important persons. It aims to their opinions, about some False Facts they apparently believe in and are entitled to keep them. Every time Len retracts, as a result of a False Fact becoming evident, he goes on usually with the help from friends.
I have taken a brief article “The Power of False Facts,” from the book Powerful Times (see page 41) by Eamonn Kelly. The source of the article is: Sharon Begley, “People Believe a ‘Fact’ That Fits Their Views Even if it’s Clearly False.” The Wall Street Journal, February 4, 2005. Permissions to reprint this and other quotes in earlier EWPC articles will be considered later on for the publication of the EWPC Book.
“What we remember depends on what we believe…. ‘People build mental models,’ explains Stephan Lewandowsky, a psychology professor at the University of Western Australia, Crowley. ‘By the time they receive a retraction, the original misinformation has already become an integral part of that mental model, or worldview, and disregarding it would leave the worldview a shambles.’ Therefore, he and his colleagues conclude in their paper, ‘People continue to rely on misinformation even if they demonstrably remember and understand a subsequent retraction’…. Even many of those who remember a retraction still rated the original claim as true.”
Readers need to be very careful to the insidious power while reading those False Facts to be able to rate them as false. Since the end of 2005, Len has retracted many times from False Facts that were found out. Now I will restrict myself only to four False Facts under this specific article.
A successful transformation of the power industry needs to be based on three essential requirements that I have uncovered: 1st) Active Demand, 2nd) Retail Competition and 3) Ultraquality Transportation. EWPC has emerged to satisfy all three requirements.
I used to say that the first and second requirements lead to Demand Integration to power system planning, operation and control on the open (retail and wholesale) market value chain. The third requirement leads to the transportation utility under a regulatory compact with a responsibility to transport is also a needed for Demand Integration, as can be seen next.
False Fact #1. IMEUC doesn’t need to satisfy the Ultraquality Transportation requirement. Len writes “Level of Reliability should be simply a market factor purchased as needed just like Level of Power etc.,” to justify the lack of Ultraquality transportation of IMEUC. My response was that ““Demand Integration is based on the fact [the third requirement emerges] that reliability has two sides: ‘On one side, system crashes are mitigated by a least cost mix of supply and demand risk management tools that may be applied in time and space [that is the Ultraquality Transportation requiremen]t. On the other, DR is the key to the segmentation of customers [based on the Retail Competition] supply security (a kind of insurance).’” After that, Bob came to the rescue by changing the subject. Readers should not forget that fact.
False Fact #2: EWPC has a Free Rider Problem; no answers are given in mentioned article. Len wrote “As an example of above. I invite readers to read the blog entry Jose Antonio refers to above, and evaluate in what way it constitutes an answer to my "Free Rider Problem in EWPC" question (NOT), at No Need for Regulated Price Caps - II .” As the next sequence of posts after that showed, it is very clear that the my “assumption ‘the default service will have essentially all the free riders being subsidized by peers.’" was available, right where I said, in the link of just mentioned EWPC article. Once gain, Bob changes the subject. But the lie goes on. He later tries to continue discussing the issue of free riding, but the real issue the False Fact.
False Fact #3: EWPC has no answers to 11 questions. Len writes for the third (not the second) time “My problem with EWPC are myriad eg. it's precisely identical to every existing failed attempt at de-regulation in N. America. And it's promoter flatly refuses to answer any difficult questions about it. Questions which I have posed before, such as:…” I showed a copy of each of the answers, to identify the False Fact that I had answered those questions earlier. Len takes those answers and ads new questions, but that was not the issue at hand, but a False Fact. Todd comes to help Len with an “abridge version” of the old responses – the evidence of the False Fact - as my explanation of EWPC, which in fact were on the link that I referred in my response to Ken as “Your good intentions are no longer necessary. The EWPC article EWPC Leadership (w/o links) has a better approach: that of essential business requirements, as the breakthrough tipping point to promote leadership.”
False Fact #4: IMEUC operates on the Economic Level. As “Many on the GridWise side start out with a control orientation, a continuation of the load limiting approaches most recently in the news in California’s short-lived thermostat proposals. As they work the problem, and become more aware of the complexity and diversity of the problem, they inevitably migrate more toward an agent-based approach. (Someone, I think it was Apperson Johnson, once said, “an agent is an object that can say no!”). … Eventually these agents have to be able to negotiate around the issues of scarcity and value; and of the desires of their owners. Such complex negotiations cannot be handled at the control level, but only at the economic level. This will push things toward the EWPC model.” Todd came to help Len and deviate the False Fact of IMEUC. BTW Todd is now silent and Bob followed him. In 2005 Len explained that his approach was a “prices to devices,” when he wrote “Jose: You're close…”
It is very important to understand that “Prices to Devices” has potential for being a market segment, but NO for the whole market.
eMail Enviado: La Hora de la Tierra es Mañana Sábado 29
Este eMail es dedicado al apreciado, distinguido y notable Dr. Rafael Molina Morillo, en compensación por lo negativo que pudiese haber sido mi artículo No hay Apagón de 5 Minutos Hoy sin que obrara en mi ninguna mala intención.
Estimados líderes, lectores y público en general,
El 29 de marzo del 2008, de 8 a 9 de la noche, millones de personas alrededor del mundo se unirán para “apagar las luces” por el lapso de una hora para demostrar su preocupación sobre el cambio climático.
Podemos promover mucho esta iniciativa y tomar parte de ella apagando las luces y computadoras, cada quien en su hora local y así combatir de manera directa el cambio climático.
Los que se quieran sumar a la campaña pueden reenviar este mensaje.
En un momento histórico en que se insiste en que el petróleo va a llegar a 200 dólares el barril y cuando ya existe un amplio consenso del potencial impacto de los combustibles fósiles en el cambio climático se estará celebrando mañana La Hora de la Tierra para que los ciudadanos de la aldea global tomen conciencia de esa posible catástrofe.
Pero, hay algo práctico, importante y urgente que se puede hacer también. Reformar los sectores eléctricos para desacoplar eficazmente el incentivo perverso de que las rentas de las empresas eléctricas suben con las ventas de electricidad.
Es precisamente en ese desacoplamiento, por medio del desarrollo de los recursos del lado de la demanda que descansa la electricidad sin control de precios (EWPC, por sus siglas en inglés). Uno de los más importantes desarrollos es la inversión coordinada en la eficiencia energética que puede facilitar en los próximos cuatro años una reducción del 25% del consumo de petróleo (ver email enviado abajo).
En el último artículo EWPC Leadership (w/o links) que publiqué en EnergyBlogs.com se resume y traduce de la forma siguiente: “Esta es una síntesis (sin ningún enlace) de la apertura de la brecha EWPC, la cual trae claridad absoluta y dirección para habilitar un cambio cultural a la industria eléctrica de la tercera revolución industrial. La Integración de la demanda por los 2GRs (detallistas de segunda generación) resultará en grandes ahorros de coordinación para la sociedad, tanto en las inversiones multianuales y en los costos de operación de los clientes. Dejar a los clientes a sálvese quien pueda es una debilidad … que es suplida por la EWPC.
Esperando la buena acogida de esta propuesta.
Muy atentamente,
José Antonio Vanderhorst-Silverio, Ph.D.
Consultor Sistémico: Electricidad
Promotor de la EWPC y del GMH
P.D.: Se sugiere dar hoy y mañana la más amplia divulgación de este mensaje. Gracias!
From: José Antonio Vanderhorst-Silverio, PhD
Sent: Saturday, November 17, 2007 4:56 PM
To: 'Rsegura’; 'Francisco Mendez'; 'Rolando Gonzalez Bunster'; 'Manuel F. Perez Dubuc'; 'Lucio Monari'; 'Gilberto Chona '; 'Temístocles Montás'; 'Moisés Pineda'; 'Roberto Saladín '; 'Aliona Cebotari Ouanes'; 'J Portocarreiro '; 'Andres van der Horst Alvarez'; 'Jaime Moreno (CNC)'; 'René Villarreal '
Subject: Reducir 25% a la Factura Petrolera en 4 años
Estimados líderes, lectores y público en general,
Reducir a las tres cuartas partes la factura petrolera en los próximos 4 años es un mensaje de muy alta significación para el futuro del país.
Para lograr esa gran meta, similar a la de Kennedy de poner un hombre en la luna en una década, es absolutamente necesario un cambio estructural, el cual puede satisfacer la aparente disyuntiva en “El Discurso del Ahorro,” que aparece en la columna Espejo de Papel, de Diario Libre, y que expresa: “Los dominicanos necesitamos gastar petróleo para impulsar el crecimiento y ahorrar petróleo para sostenerlo. La disyuntiva hace que el problema de los combustibles sea de difícil solución…”
El sector más importante para alcanzar una meta como esa es el sector eléctrico. Una propuesta para alcanzarla aparece en la nota Una Crítica Eléctrica al Discurso Presidencial que se complementa en el artículo To EEI: “Let's Ban Regulation,” Starting in Ohio, aunque la idea subyacente sería que empezáramos lo antes posible en el país.
Evidentemente y por ejemplo, esta es una nota de esperanza, como la planteada por el presidente de la Asociación de Comerciantes e Industriales de Santiago (ver Empresarios apoyan con reservas el plan de ahorro), que no obstante se “quejó de que la disposición orientada a impulsar el desarrollo del gas natural en el transporte en general, no tomó en cuenta la actividad industrial y comercial nacional, y es precisamente ese sector que hace uso continuo de dicho combustible en las plantas de generación y de emergencia.”
Esperando la buena acogida de esta propuesta.
Muy atentamente,
José Antonio Vanderhorst-Silverio, Ph.D.
Consultor Sistémico: Electricidad
Promotor de la EWPC y del GMH
P.D.: Se sugiere dar la más amplia divulgación de este mensaje. Gracias!
Estimados líderes, lectores y público en general,
El 29 de marzo del 2008, de 8 a 9 de la noche, millones de personas alrededor del mundo se unirán para “apagar las luces” por el lapso de una hora para demostrar su preocupación sobre el cambio climático.
Podemos promover mucho esta iniciativa y tomar parte de ella apagando las luces y computadoras, cada quien en su hora local y así combatir de manera directa el cambio climático.
Los que se quieran sumar a la campaña pueden reenviar este mensaje.
En un momento histórico en que se insiste en que el petróleo va a llegar a 200 dólares el barril y cuando ya existe un amplio consenso del potencial impacto de los combustibles fósiles en el cambio climático se estará celebrando mañana La Hora de la Tierra para que los ciudadanos de la aldea global tomen conciencia de esa posible catástrofe.
Pero, hay algo práctico, importante y urgente que se puede hacer también. Reformar los sectores eléctricos para desacoplar eficazmente el incentivo perverso de que las rentas de las empresas eléctricas suben con las ventas de electricidad.
Es precisamente en ese desacoplamiento, por medio del desarrollo de los recursos del lado de la demanda que descansa la electricidad sin control de precios (EWPC, por sus siglas en inglés). Uno de los más importantes desarrollos es la inversión coordinada en la eficiencia energética que puede facilitar en los próximos cuatro años una reducción del 25% del consumo de petróleo (ver email enviado abajo).
En el último artículo EWPC Leadership (w/o links) que publiqué en EnergyBlogs.com se resume y traduce de la forma siguiente: “Esta es una síntesis (sin ningún enlace) de la apertura de la brecha EWPC, la cual trae claridad absoluta y dirección para habilitar un cambio cultural a la industria eléctrica de la tercera revolución industrial. La Integración de la demanda por los 2GRs (detallistas de segunda generación) resultará en grandes ahorros de coordinación para la sociedad, tanto en las inversiones multianuales y en los costos de operación de los clientes. Dejar a los clientes a sálvese quien pueda es una debilidad … que es suplida por la EWPC.
Esperando la buena acogida de esta propuesta.
Muy atentamente,
José Antonio Vanderhorst-Silverio, Ph.D.
Consultor Sistémico: Electricidad
Promotor de la EWPC y del GMH
P.D.: Se sugiere dar hoy y mañana la más amplia divulgación de este mensaje. Gracias!
From: José Antonio Vanderhorst-Silverio, PhD
Sent: Saturday, November 17, 2007 4:56 PM
To: 'Rsegura’; 'Francisco Mendez'; 'Rolando Gonzalez Bunster'; 'Manuel F. Perez Dubuc'; 'Lucio Monari'; 'Gilberto Chona '; 'Temístocles Montás'; 'Moisés Pineda'; 'Roberto Saladín '; 'Aliona Cebotari Ouanes'; 'J Portocarreiro '; 'Andres van der Horst Alvarez'; 'Jaime Moreno (CNC)'; 'René Villarreal '
Subject: Reducir 25% a la Factura Petrolera en 4 años
Estimados líderes, lectores y público en general,
Reducir a las tres cuartas partes la factura petrolera en los próximos 4 años es un mensaje de muy alta significación para el futuro del país.
Para lograr esa gran meta, similar a la de Kennedy de poner un hombre en la luna en una década, es absolutamente necesario un cambio estructural, el cual puede satisfacer la aparente disyuntiva en “El Discurso del Ahorro,” que aparece en la columna Espejo de Papel, de Diario Libre, y que expresa: “Los dominicanos necesitamos gastar petróleo para impulsar el crecimiento y ahorrar petróleo para sostenerlo. La disyuntiva hace que el problema de los combustibles sea de difícil solución…”
El sector más importante para alcanzar una meta como esa es el sector eléctrico. Una propuesta para alcanzarla aparece en la nota Una Crítica Eléctrica al Discurso Presidencial que se complementa en el artículo To EEI: “Let's Ban Regulation,” Starting in Ohio, aunque la idea subyacente sería que empezáramos lo antes posible en el país.
Evidentemente y por ejemplo, esta es una nota de esperanza, como la planteada por el presidente de la Asociación de Comerciantes e Industriales de Santiago (ver Empresarios apoyan con reservas el plan de ahorro), que no obstante se “quejó de que la disposición orientada a impulsar el desarrollo del gas natural en el transporte en general, no tomó en cuenta la actividad industrial y comercial nacional, y es precisamente ese sector que hace uso continuo de dicho combustible en las plantas de generación y de emergencia.”
Esperando la buena acogida de esta propuesta.
Muy atentamente,
José Antonio Vanderhorst-Silverio, Ph.D.
Consultor Sistémico: Electricidad
Promotor de la EWPC y del GMH
P.D.: Se sugiere dar la más amplia divulgación de este mensaje. Gracias!
miércoles, marzo 26, 2008
EWPC Leadership (w/o links)
This is a synthesis (without any links) of the EWPC breakthrough, which brings absolute clarity and direction to enable a cultural shift to the power industry of the third industrial revolution. Demand Integration by 2GRs result in large coordination savings for society as a whole, both in customers' multiyear investments and operation costs. Letting every customer for himself is a weakness in Gridwise that is filled by EWPC.
EWPC Leadership (w/o links)
By José Antonio Vanderhorst-Silverio, Ph.D.
Systemic Consultant: Electricity
First posted in the GMH Blog, on March 26st, 2008.
Copyright © 2008 José Antonio Vanderhorst-Silverio. All rights reserved. No part of this article may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopying and recording, without written permission from José Antonio Vanderhorst-Silverio. This article is an unedited, an uncorrected, draft material of The EWPC Textbook. Please write to javs@ieee.org to contact the author for any kind of engagement.
Electricity is a very complex subject, until we uncover its essence. The essence enables the personal side of leadership, which in turns enables a culture for the third industrial revolution to support the strategic side of leadership. Peter Koestenbaum wrote that “Paradoxical as it may seem, the personal [side of leadership] precedes the strategic; good strategy is created by a brilliant mind and implemented by a strong character, not the other way around.”
The articles in the Electricity Without Price Controls (EWPC) Blog can be though of as a holographic image from a different perspective of the whole EWPC market architecture and design paradigm shift. As Koestenbaum suggests in his Leadership Diamond Toolbox, “you do not sell a product or service; you help customers buy leadership in their affairs.”
EWPC emerged for the world of the third industrial revolution, where demand is no longer an externality and there is a need for a power system that should operate at ultraquality, with the help of demand response, in a wholesale, retail, customer value chain.
The essence of EWPC is "the generic market model paradigm: Retail Competition, Active Demand, and Ultraquality Transportation," which includes wholesale competition, as 2GRs link both markets.
Such essence is the basis for a breakthrough, which is the tipping point that shifts paradigms permanently. The breakthrough is … the epitome of the 'AHHA!' moment bringing absolute clarity and direction… that now … comes to the power industry for both the open (retail and wholesale) market (with competitive incentives for the development of business model innovations) and the closed (transportation) market (the new utility, with a responsibility to transport).
The Old utilities paradigm (with a responsibility to serve) comes from demand as an externality (inactive demand and no competition) and has already served its purpose with its obsolete business model of winning rate case to the regulator. Each incremental extension of the Old paradigm results in unnecessary accumulated costs paid by customers and "earned" by utilities.
EWPC comes from - a different place altogether - Demand Integration (which comes from Active Demand and Retail Competition) to power system planning, operation and control by 2GRs, resulting in large coordination savings for society as a whole, both in customers' multiyear investments and operation costs. Letting every customer for himself is a weakness in Gridwise that is filled by EWPC.
EWPC is not just about the need for new data or new systems (the strategic side of leadership), but first and foremost for new health and fresh determination (the personal side of leadership).
Reference: Peter Koestenbaum, “Leadership – The Inner Side of Greatness”
EWPC Leadership (w/o links)
By José Antonio Vanderhorst-Silverio, Ph.D.
Systemic Consultant: Electricity
First posted in the GMH Blog, on March 26st, 2008.
Copyright © 2008 José Antonio Vanderhorst-Silverio. All rights reserved. No part of this article may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopying and recording, without written permission from José Antonio Vanderhorst-Silverio. This article is an unedited, an uncorrected, draft material of The EWPC Textbook. Please write to javs@ieee.org to contact the author for any kind of engagement.
Electricity is a very complex subject, until we uncover its essence. The essence enables the personal side of leadership, which in turns enables a culture for the third industrial revolution to support the strategic side of leadership. Peter Koestenbaum wrote that “Paradoxical as it may seem, the personal [side of leadership] precedes the strategic; good strategy is created by a brilliant mind and implemented by a strong character, not the other way around.”
The articles in the Electricity Without Price Controls (EWPC) Blog can be though of as a holographic image from a different perspective of the whole EWPC market architecture and design paradigm shift. As Koestenbaum suggests in his Leadership Diamond Toolbox, “you do not sell a product or service; you help customers buy leadership in their affairs.”
EWPC emerged for the world of the third industrial revolution, where demand is no longer an externality and there is a need for a power system that should operate at ultraquality, with the help of demand response, in a wholesale, retail, customer value chain.
The essence of EWPC is "the generic market model paradigm: Retail Competition, Active Demand, and Ultraquality Transportation," which includes wholesale competition, as 2GRs link both markets.
Such essence is the basis for a breakthrough, which is the tipping point that shifts paradigms permanently. The breakthrough is … the epitome of the 'AHHA!' moment bringing absolute clarity and direction… that now … comes to the power industry for both the open (retail and wholesale) market (with competitive incentives for the development of business model innovations) and the closed (transportation) market (the new utility, with a responsibility to transport).
The Old utilities paradigm (with a responsibility to serve) comes from demand as an externality (inactive demand and no competition) and has already served its purpose with its obsolete business model of winning rate case to the regulator. Each incremental extension of the Old paradigm results in unnecessary accumulated costs paid by customers and "earned" by utilities.
EWPC comes from - a different place altogether - Demand Integration (which comes from Active Demand and Retail Competition) to power system planning, operation and control by 2GRs, resulting in large coordination savings for society as a whole, both in customers' multiyear investments and operation costs. Letting every customer for himself is a weakness in Gridwise that is filled by EWPC.
EWPC is not just about the need for new data or new systems (the strategic side of leadership), but first and foremost for new health and fresh determination (the personal side of leadership).
Reference: Peter Koestenbaum, “Leadership – The Inner Side of Greatness”
jueves, marzo 20, 2008
Missing From Gridwise
Missing from the GridWise approach is the need to restructure as soon as possible the power industry to eliminate the barriers imposed by "the lumbering old style utilities companies" and to manage the physical systemic risks of power system failure. The EWPC market architecture and design should be the End-State of the power industry for quite some time to enable the mentioned approach.
Missing From Gridwise
By José Antonio Vanderhorst-Silverio, Ph.D.
Systemic Consultant: Electricity
First posted in the GMH Blog, on March 21st, 2008.
Copyright © 2008 José Antonio Vanderhorst-Silverio. All rights reserved. No part of this article may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopying and recording, without written permission from José Antonio Vanderhorst-Silverio. This article is an unedited, an uncorrected, draft material of The EWPC Textbook. Please write to javs@ieee.org to contact the author for any kind of engagement.
The NewDaedalus article “Do you choose Incrementalism or Markets?” starts with “The Grid doesn’t get better because we keep on relying on central planning to make it better. Any efforts developed exclusively by the current stakeholders and run through the utilities commissions will predictable and incrementalist. There is one (at least) that is not. The GridWise Architectural Council is trying to create open interoperable protocols to enable vibrant markets to develop, ones that are not driven by or yoked to the lumbering old style utilities companies.”
The creation of open interoperable protocols is great progress to the future of the power industry. However, the first sentence of the above paragraph jumps into an unnecessary conclusion, because the power industry Grid need to be better understood. Once understood, the elements to replace as soon as possible the old style utilities companies will be enabled to eliminate most barriers to progress that will enable breakthroughs instead of incrementalism.
As explained in the EWPC article Free Market and Central Planning, Under R1E2, the utility Grid needs to be separated into the utility Grid and the utility Enterprise. The utility Grid should keep relying on central planning to make it better as depicted in the EWPC article The Smart Grid Transportation Utility.
At the same time, the utility Enterprise needs to be replaced by an open market technology neutral Second Generation Retailers - 2GRs under the breakthrough EWPC market architecture and design. The new EWPC stakeholders will enable innovations as suggested in the EWPC article Shrinking the Regulator’s Jobs, whose summary says:
“There is a need for a shared vision to restructure the power industry, shrinking regulators jobs to price controls of the remaining transportation electric utilities and letting end-customers make their own investments and purchasing decisions of electricity. The shared vision needs to go to the public opinion so that high level political decisions are enabled to restructure the electricity industry and shrinking regulators jobs.”
From the perspective of power system planning, operation and control it is going to a long transition to arrive to a truly competitive and commercial service that the NewDaedalus article states: “Live power pricing will drive storage development better than any number of central government programs; better storage will make responsiveness to price signals easier. From there, every means of alternate energy, no matter how unreliable, become another way to charge the storage. Sites will have multiple generation strategies depending upon their location, winds, sun coverage, thermal posture…”.
To bridge the long transition, that will shift the direction of power on the transportation system, what needs to be added to the GridWise approach is found in the EWPC article Customer Reliability and System Reliability. Similar to bank runs that fuel systemic risks, live power pricing will lead, when less expected, to power system systemic risks in the long run (system adequacy) and the short run (system security). The economics of electricity service will still depend on central station generation for a long while. That is why I claim that EWPC is the market architecture and design is the End-State of the power industry for quite some time.
Reference and context: A Power Grid Smartens Up, by Peter Fairley, MIT Technology Review.
Missing From Gridwise
By José Antonio Vanderhorst-Silverio, Ph.D.
Systemic Consultant: Electricity
First posted in the GMH Blog, on March 21st, 2008.
Copyright © 2008 José Antonio Vanderhorst-Silverio. All rights reserved. No part of this article may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopying and recording, without written permission from José Antonio Vanderhorst-Silverio. This article is an unedited, an uncorrected, draft material of The EWPC Textbook. Please write to javs@ieee.org to contact the author for any kind of engagement.
The NewDaedalus article “Do you choose Incrementalism or Markets?” starts with “The Grid doesn’t get better because we keep on relying on central planning to make it better. Any efforts developed exclusively by the current stakeholders and run through the utilities commissions will predictable and incrementalist. There is one (at least) that is not. The GridWise Architectural Council is trying to create open interoperable protocols to enable vibrant markets to develop, ones that are not driven by or yoked to the lumbering old style utilities companies.”
The creation of open interoperable protocols is great progress to the future of the power industry. However, the first sentence of the above paragraph jumps into an unnecessary conclusion, because the power industry Grid need to be better understood. Once understood, the elements to replace as soon as possible the old style utilities companies will be enabled to eliminate most barriers to progress that will enable breakthroughs instead of incrementalism.
As explained in the EWPC article Free Market and Central Planning, Under R1E2, the utility Grid needs to be separated into the utility Grid and the utility Enterprise. The utility Grid should keep relying on central planning to make it better as depicted in the EWPC article The Smart Grid Transportation Utility.
At the same time, the utility Enterprise needs to be replaced by an open market technology neutral Second Generation Retailers - 2GRs under the breakthrough EWPC market architecture and design. The new EWPC stakeholders will enable innovations as suggested in the EWPC article Shrinking the Regulator’s Jobs, whose summary says:
“There is a need for a shared vision to restructure the power industry, shrinking regulators jobs to price controls of the remaining transportation electric utilities and letting end-customers make their own investments and purchasing decisions of electricity. The shared vision needs to go to the public opinion so that high level political decisions are enabled to restructure the electricity industry and shrinking regulators jobs.”
From the perspective of power system planning, operation and control it is going to a long transition to arrive to a truly competitive and commercial service that the NewDaedalus article states: “Live power pricing will drive storage development better than any number of central government programs; better storage will make responsiveness to price signals easier. From there, every means of alternate energy, no matter how unreliable, become another way to charge the storage. Sites will have multiple generation strategies depending upon their location, winds, sun coverage, thermal posture…”.
To bridge the long transition, that will shift the direction of power on the transportation system, what needs to be added to the GridWise approach is found in the EWPC article Customer Reliability and System Reliability. Similar to bank runs that fuel systemic risks, live power pricing will lead, when less expected, to power system systemic risks in the long run (system adequacy) and the short run (system security). The economics of electricity service will still depend on central station generation for a long while. That is why I claim that EWPC is the market architecture and design is the End-State of the power industry for quite some time.
Reference and context: A Power Grid Smartens Up, by Peter Fairley, MIT Technology Review.
miércoles, marzo 19, 2008
Abramos Brecha Progreso con DR-CAFTA
El Listín Diario lanzó una Alerta Económica el 18 de marzo del 2008, sugiriendo que el “gobierno y la oposición, deberían enfrascarse conjuntamente en la organización de un plan que prevalezca más allá del proceso electoral o de la vigencia de un gobierno.” El GMH ha llegado a la conclusión de que el sector privado del país y el de Centroamérica están en mucha mejor capacidad que los políticos para llenar ese cometido. Lo que hace falta es abrir una brecha (“breakthrough”).
Paulette L. Stenzel, Profesora de Leyes de Negocio Internacional de la Universidad del Estado de Michigan, en su artículo “Porqué el DR-CAFTA Enfrenta Oposición de los ciudadanos de Centroamérica y la República Dominicana,” concluye que “las provisiones del DR-CAFTA simplemente no proveen salarios llevaderos, prácticas de trabajo justas, ni la protección ambiental necesaria. En este momento de la historia, solo la acción voluntaria de las compañías que operan en los países del DR-CAFTA llevará a prácticas justas de trabajo, salarios llevaderos y prácticas ambientales sanas.”
Para que las compañías actúen de manera voluntaria, es necesario que las mismas abran una brecha, porque se convencen que el mundo está en una transición a la tercera revolución industrial. Una brecha, de acuerdo a Donna Karlin, “es muy diferente que hacer cambios pequeños… que pueden ser o no sostenibles; es el punto clave que cambia paradigmas permanentemente. Cambia la forma en que uno procesa los pensamientos, la forma en que enfrenta algo e interactúa, trata los asuntos, dirige a los otros, … es todo eso. Nunca volverá a ser el mismo o regresará porque la forma en que piensa vendrá de un lugar totalmente diferente.
El mejor ejemplo está en las compañías del sector eléctrico de DR-CAFTA, que tienen en la Electricidad Sin Control de Precios (EWPC, por sus siglas en inglés) una magnifica oportunidad para actuar de manera voluntaria. El paradigma de las empresas eléctricas descansa en empresas distribuidoras en que la demanda es una exterioridad (demanda inactiva y sin competencia). Estamos siguiendo un proceso lento y muy costoso para rescatar las distribuidoras que muy pronto desaparecerán.
La EWPC viene de un lugar totalmente diferente, la Integración de la Demanda (que a su vez viene de la Demanda Activa y la Competencia al Detalle) a la planificación, operación y control del sistema interconectado. Es en esa brecha del progreso en que están garantizados los grandes beneficios en este momento de la historia para todos para aprovechar al máximo el DR-CAFTA. Dado que la electricidad es una pieza clave de la competitividad sistémica, estaremos cada vez más en capacidad de incrementar nuestras exportaciones de bienes y servicios a los Estados Unidos.
Paulette L. Stenzel, Profesora de Leyes de Negocio Internacional de la Universidad del Estado de Michigan, en su artículo “Porqué el DR-CAFTA Enfrenta Oposición de los ciudadanos de Centroamérica y la República Dominicana,” concluye que “las provisiones del DR-CAFTA simplemente no proveen salarios llevaderos, prácticas de trabajo justas, ni la protección ambiental necesaria. En este momento de la historia, solo la acción voluntaria de las compañías que operan en los países del DR-CAFTA llevará a prácticas justas de trabajo, salarios llevaderos y prácticas ambientales sanas.”
Para que las compañías actúen de manera voluntaria, es necesario que las mismas abran una brecha, porque se convencen que el mundo está en una transición a la tercera revolución industrial. Una brecha, de acuerdo a Donna Karlin, “es muy diferente que hacer cambios pequeños… que pueden ser o no sostenibles; es el punto clave que cambia paradigmas permanentemente. Cambia la forma en que uno procesa los pensamientos, la forma en que enfrenta algo e interactúa, trata los asuntos, dirige a los otros, … es todo eso. Nunca volverá a ser el mismo o regresará porque la forma en que piensa vendrá de un lugar totalmente diferente.
El mejor ejemplo está en las compañías del sector eléctrico de DR-CAFTA, que tienen en la Electricidad Sin Control de Precios (EWPC, por sus siglas en inglés) una magnifica oportunidad para actuar de manera voluntaria. El paradigma de las empresas eléctricas descansa en empresas distribuidoras en que la demanda es una exterioridad (demanda inactiva y sin competencia). Estamos siguiendo un proceso lento y muy costoso para rescatar las distribuidoras que muy pronto desaparecerán.
La EWPC viene de un lugar totalmente diferente, la Integración de la Demanda (que a su vez viene de la Demanda Activa y la Competencia al Detalle) a la planificación, operación y control del sistema interconectado. Es en esa brecha del progreso en que están garantizados los grandes beneficios en este momento de la historia para todos para aprovechar al máximo el DR-CAFTA. Dado que la electricidad es una pieza clave de la competitividad sistémica, estaremos cada vez más en capacidad de incrementar nuestras exportaciones de bienes y servicios a los Estados Unidos.
martes, marzo 18, 2008
Ed. Listín Diario - Alerta Económica
Nuestro país, y en especial nuestras autoridades, harían bien en desembarazarse de las francachelas de la campaña política y comenzar a adoptar previsiones ante la situación económica mundial.
Las principales autoridades del Fondo Monetario Internacional (FMI) y de la Organización para la Cooperación y el Desarrollo Económico (OCDE) ayer lanzaron un alerta desde París al resto del planeta sobre la profundización de la crisis económica de Estados Unidos que se está extendiendo a todas las naciones. El mensaje fue simple: La crisis se incrementará, se extenderá y afectará a todos.
Ante la denuncia de agravamiento de la situación en todo el mundo, nuestros principales dirigentes, en el gobierno y la oposición, deberían enfrascarse conjuntamente en la organización de un plan que prevalezca más allá del proceso electoral o de la vigencia de un gobierno.
Mientras parece que tomamos los asuntos con bastante desparpajo en estos meses electorales, las grandes economías del mundo han comenzado a adoptar medidas de previsión para recibir el impacto.
Desde que se inició la crisis de las hipotecas en Estados Unidos se han producido altibajos en los mercados mundiales, pero la crisis financiera de importantes bancos y la quiebra de uno de los más grandes en la pasada semana, produjeron un agravamiento y gran impacto en todo el mundo.
Hay que descartar que la economía dominicana estará inmune a esas sacudidas. Es necesario comenzar a adoptar medidas preventivas de ahorro real de recursos, reducción en el consumo y resguardar nuestros sistemas productivos, principalmente de alimentos.
De continuar las presiones en los mercados, las consecuencias más graves sobre nuestro país podrían estar presentándose en los momentos más duros de la presente campaña política.
Editorial original Alerta económica
Las principales autoridades del Fondo Monetario Internacional (FMI) y de la Organización para la Cooperación y el Desarrollo Económico (OCDE) ayer lanzaron un alerta desde París al resto del planeta sobre la profundización de la crisis económica de Estados Unidos que se está extendiendo a todas las naciones. El mensaje fue simple: La crisis se incrementará, se extenderá y afectará a todos.
Ante la denuncia de agravamiento de la situación en todo el mundo, nuestros principales dirigentes, en el gobierno y la oposición, deberían enfrascarse conjuntamente en la organización de un plan que prevalezca más allá del proceso electoral o de la vigencia de un gobierno.
Mientras parece que tomamos los asuntos con bastante desparpajo en estos meses electorales, las grandes economías del mundo han comenzado a adoptar medidas de previsión para recibir el impacto.
Desde que se inició la crisis de las hipotecas en Estados Unidos se han producido altibajos en los mercados mundiales, pero la crisis financiera de importantes bancos y la quiebra de uno de los más grandes en la pasada semana, produjeron un agravamiento y gran impacto en todo el mundo.
Hay que descartar que la economía dominicana estará inmune a esas sacudidas. Es necesario comenzar a adoptar medidas preventivas de ahorro real de recursos, reducción en el consumo y resguardar nuestros sistemas productivos, principalmente de alimentos.
De continuar las presiones en los mercados, las consecuencias más graves sobre nuestro país podrían estar presentándose en los momentos más duros de la presente campaña política.
Editorial original Alerta económica
lunes, marzo 17, 2008
Customer Reliability and System Reliability
Demand Integration is based on the fact that reliability has two sides: “On one side, system crashes are mitigated by a least cost mix of supply and demand risk management tools that may be applied in time and space. On the other, DR is the key to the segmentation of customers supply security (a kind of insurance).”
Customer Reliability and System Reliability
By José Antonio Vanderhorst-Silverio, Ph.D.
Systemic Consultant: Electricity
First posted in the GMH Blog, on March 17th, 2008.
Copyright © 2008 José Antonio Vanderhorst-Silverio. All rights reserved. No part of this article may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopying and recording, without written permission from José Antonio Vanderhorst-Silverio. This article is an unedited, an uncorrected, draft material of The EWPC Textbook. Please write to javs@ieee.org to contact the author for any kind of engagement.
Demand Response came to public awareness when several large and very costly system blackouts disrupted the U.S., Italy, and other industrialized countries. Those countries have a need for a synchronized power system market architecture and design that minimizes the likelihood of domino like cascading failures. The essential requirements of Ultraquality Transportation and Demand Integration to power system planning, operations and control are key ingredients for significantly reducing blackout disruptive powers, which are not addressed by present utility centered paradigms and IMEUC as shown in Power Markets Essential Requirements and Power Markets Essential Requirements - II, which is summarized by the paragraph:
Mission accomplished!!! [These] are comments received and responded under the article Power Markets Essential Requirements. Readers will find that the two assertions questioned, are certainly true: IMEUC has NO Ultraquality, and NO Demand Integration to power system planning, operation and control. Ultraquality is a system characteristic. The incentive system is spelled out clearly. While IMEUC is technology dependent, EWPC is technology neutral. A standard meter is needed for 2GR to develop their business model innovations. Nothing else is needed to reconfirm the winner in the market vs. market competition, this time based on the essential requirements: Retail Competition with Active Demand and Ultraquality Transportation.
Under EWPC the “Level of [customer] Reliability [is, not just should be,] simply a market factor purchased as needed just like Level of Power etc.” In my [seminal], and only article on EnergyPulse, An Alternative Business Case for Demand Response, I stated: “The business case of Demand Response (DR) is enhanced under free markets, innovation, and probabilistic (risk) mindsets. DR is poised to be the demand side risk management tool to complement the traditional "LOLP" supply side risk management tool. There are two sides on the DR coin. On one side, system crashes are mitigated by a least cost mix of supply and demand risk management tools that may be applied in time and space. On the other, DR is the key to the segmentation of customers supply security (a kind of insurance). Because of its fine grain nature, DR can help mitigate delays (intended or not) of lumpy investments in generation, transmission, and distribution.”
Transportation Ultraquality, a MUST that IMEUC lack, includes a process to perform system adequacy (developing long run systemic risk management) and system security (executing short run systemic risk management) by developing/executing “a least cost mix of supply and demand risk management tools that may be applied in time and space” to implement Demand Integration to power system planning, operation and control.
Reference and context: A Fresh Approach to Managing Peak Demand, by Gary Paul, VP, Outsourcing Business Development, Capgemini
Customer Reliability and System Reliability
By José Antonio Vanderhorst-Silverio, Ph.D.
Systemic Consultant: Electricity
First posted in the GMH Blog, on March 17th, 2008.
Copyright © 2008 José Antonio Vanderhorst-Silverio. All rights reserved. No part of this article may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopying and recording, without written permission from José Antonio Vanderhorst-Silverio. This article is an unedited, an uncorrected, draft material of The EWPC Textbook. Please write to javs@ieee.org to contact the author for any kind of engagement.
Demand Response came to public awareness when several large and very costly system blackouts disrupted the U.S., Italy, and other industrialized countries. Those countries have a need for a synchronized power system market architecture and design that minimizes the likelihood of domino like cascading failures. The essential requirements of Ultraquality Transportation and Demand Integration to power system planning, operations and control are key ingredients for significantly reducing blackout disruptive powers, which are not addressed by present utility centered paradigms and IMEUC as shown in Power Markets Essential Requirements and Power Markets Essential Requirements - II, which is summarized by the paragraph:
Mission accomplished!!! [These] are comments received and responded under the article Power Markets Essential Requirements. Readers will find that the two assertions questioned, are certainly true: IMEUC has NO Ultraquality, and NO Demand Integration to power system planning, operation and control. Ultraquality is a system characteristic. The incentive system is spelled out clearly. While IMEUC is technology dependent, EWPC is technology neutral. A standard meter is needed for 2GR to develop their business model innovations. Nothing else is needed to reconfirm the winner in the market vs. market competition, this time based on the essential requirements: Retail Competition with Active Demand and Ultraquality Transportation.
Under EWPC the “Level of [customer] Reliability [is, not just should be,] simply a market factor purchased as needed just like Level of Power etc.” In my [seminal], and only article on EnergyPulse, An Alternative Business Case for Demand Response, I stated: “The business case of Demand Response (DR) is enhanced under free markets, innovation, and probabilistic (risk) mindsets. DR is poised to be the demand side risk management tool to complement the traditional "LOLP" supply side risk management tool. There are two sides on the DR coin. On one side, system crashes are mitigated by a least cost mix of supply and demand risk management tools that may be applied in time and space. On the other, DR is the key to the segmentation of customers supply security (a kind of insurance). Because of its fine grain nature, DR can help mitigate delays (intended or not) of lumpy investments in generation, transmission, and distribution.”
Transportation Ultraquality, a MUST that IMEUC lack, includes a process to perform system adequacy (developing long run systemic risk management) and system security (executing short run systemic risk management) by developing/executing “a least cost mix of supply and demand risk management tools that may be applied in time and space” to implement Demand Integration to power system planning, operation and control.
Reference and context: A Fresh Approach to Managing Peak Demand, by Gary Paul, VP, Outsourcing Business Development, Capgemini
Well Beyond Low Reserves Managing
NONE of today’s utilities should be allowed to take as inevitable a bare bones approach to increase efficiency, introducing a high leverage shake-up to the industry. Unlike traditional utilities, competitive Second Generation Retailers will have “end-to-end responsibility and be willing to have a stake in delivering results… ” to end-customers.
Well Beyond Low Reserves Managing
By José Antonio Vanderhorst-Silverio, Ph.D.
Systemic Consultant: Electricity
First posted in the GMH Blog, on March 17th, 2008.
Copyright © 2008 José Antonio Vanderhorst-Silverio. All rights reserved. No part of this article may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopying and recording, without written permission from José Antonio Vanderhorst-Silverio. This article is an unedited, an uncorrected, draft material of The EWPC Textbook. Please write to javs@ieee.org to contact the author for any kind of engagement.
Under EWPC, NONE of the “… utilities will … take a bare bones approach…” that Capgemini sees as inevitable. Those utilities, which like dogs are unable to learn new tricks, insist in keeping a “bares bone” obsolete non competitive business model of winning rate cases to the regulator. That is an unnecessary risk taken by governments and the power industry that is solved under competition by the EWPC market architecture and design paradigm shift, under a NO jurisdiction left behind.
EWPC Retail Competition, to be done by Second Generation Retailers - 2GRs, involve business model innovations, which go well beyond managing peak demand or low generation, that reduces reserves, anytime, anywhere, by introducing everywhere a high leverage shake-up. For example, a High Leverage Shake-Up in California (please hit the link here and elsewhere to get to the corresponding article) is needed to repair the immense damage done to the worldwide power industry with the The BIG California LIE. The shake-up, however, can be initiated in wherever jurisdiction that wants to take the leadership that California has been unable to show so far.
In the article “COMPETITION RULES! TALK AMONGST YOURSELVES... ,” Martin Rosenberg quotes” four articulate CEOs”:
WE FACE HUGE, COMPLEX GLOBAL ENERGY CHALLENGES. COMPETITION UNLEASHES ALL THE POSSIBILITIES TO HELP SOLVE THESE CHALLENGES FOR OUR CUSTOMERS.
Jim Burke, CEO, TXU Energy
CUSTOMER FIRES ENERGY COMPANY.
Lois Hedge-Peth, COO, Direct Energy
COMPETITION DRIVES INNOVATION AND LOWER PRICES IN BOTH WHOLESALE AND RETAIL ENERGY MARKETS. PERVASIVE COMPETITION WILL ALLOW OUR INDUSTRY TO EFFECTIVELY ADDRESS THE MAJOR ISSUES INCLUDING CLIMATE CHANGE, NEED FOR NEW GENERATION INVESTMENTS AND GRID INVESTMENTS.
Michael Kagan, President, Constellation NewEnergy
THE POWER INDUSTRY HAS BY THE THE LOWEST CAPACITY UTILITIZATION RATE AMONG CAPITAL-INTENSIVE BUSINESSES, AND ONLY COMPETITIVE RETAIL MARKETS CAN END MORE THAN A CENTURY OF INEFFICIENCY.
Mark Jacobs, CEO, Reliant Energy
Capgemini defines “the electrical energy market” as that market that includes “… generators, system operators, transmission and distribution service providers, retailers, energy service companies, consumers, regulators and legislators…”
In response to another Capgemini article (see The Smart Grid Transportation Utility), I concluded that “Dramatic and radical change is coming to the electric utility industry as the utility itself evolves to the smart transportation grid, under a complete rethinking of the electric industry. Front and back office generation and customer facing activities become free market activities under prudential regulations.”
The system operators and the transmission and distribution service providers become the integrated (T&D) transportation utility under a compact with a responsibility of transport, instead of a responsibility to serve, in exchange for a regulated price control tolls payment. The “ability to earn a return on their investments in” the transportation infrastructure under traditional regulation is without any doubt. As “[T]he current state of the electrical infrastructure in North America is not sustainable…,” the paradigm shift to EWPC will enable a sustainable smart grid transportation utility electrical infrastructure in America and the rest of the world.
Under EWPC, the investments necessary for Demand Integration (no just smart metering) will be coordinated by Second Generation Retailers. The broader set of benefits of aggregating retail demand to produce wholesale demand, refining grid planning, and improving grid monitoring and control, are part of the Demand Integration processes to power system planning, operation and control.
Instead of an artificial decoupling of the utility grid and the utility enterprise, like that under structural separation of the grid and the enterprise that lead to a Complex and Ugly System (see The Good, the Bad and the Ugly), real decoupling is produced by having distribution integrated with transmission in the transportation utility compact leading to the Good and Simple System.
As they take on today’s utilities enterprise activities on a competitive basis, 2GRs integrate the functions of retailers, load serving entities, and aggregators, increasing the efficiency and effectiveness of the whole system. Unlike utilities, competitive 2GRs will have “end-to-end responsibility and be willing to have a stake in delivering results… ” to end-customers. So, paraphrasing the author, “… [2GRs will] look beyond the technology into the opportunities and incentives the technology unlocks. Indeed, [2Grs will] take a more comprehensive view of smart metering. More important than the technology itself is the role it plays in enabling system operators, 2GRs and customers to … improve market efficiency.” 2GRs “should seek out partners who will work collaboratively with them to ensure the success…” of their business models.
Reference and context: A Fresh Approach to Managing Peak Demand, by Gary Paul, VP, Outsourcing Business Development, Capgemini
Well Beyond Low Reserves Managing
By José Antonio Vanderhorst-Silverio, Ph.D.
Systemic Consultant: Electricity
First posted in the GMH Blog, on March 17th, 2008.
Copyright © 2008 José Antonio Vanderhorst-Silverio. All rights reserved. No part of this article may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopying and recording, without written permission from José Antonio Vanderhorst-Silverio. This article is an unedited, an uncorrected, draft material of The EWPC Textbook. Please write to javs@ieee.org to contact the author for any kind of engagement.
Under EWPC, NONE of the “… utilities will … take a bare bones approach…” that Capgemini sees as inevitable. Those utilities, which like dogs are unable to learn new tricks, insist in keeping a “bares bone” obsolete non competitive business model of winning rate cases to the regulator. That is an unnecessary risk taken by governments and the power industry that is solved under competition by the EWPC market architecture and design paradigm shift, under a NO jurisdiction left behind.
EWPC Retail Competition, to be done by Second Generation Retailers - 2GRs, involve business model innovations, which go well beyond managing peak demand or low generation, that reduces reserves, anytime, anywhere, by introducing everywhere a high leverage shake-up. For example, a High Leverage Shake-Up in California (please hit the link here and elsewhere to get to the corresponding article) is needed to repair the immense damage done to the worldwide power industry with the The BIG California LIE. The shake-up, however, can be initiated in wherever jurisdiction that wants to take the leadership that California has been unable to show so far.
In the article “COMPETITION RULES! TALK AMONGST YOURSELVES... ,” Martin Rosenberg quotes” four articulate CEOs”:
WE FACE HUGE, COMPLEX GLOBAL ENERGY CHALLENGES. COMPETITION UNLEASHES ALL THE POSSIBILITIES TO HELP SOLVE THESE CHALLENGES FOR OUR CUSTOMERS.
Jim Burke, CEO, TXU Energy
CUSTOMER FIRES ENERGY COMPANY.
Lois Hedge-Peth, COO, Direct Energy
COMPETITION DRIVES INNOVATION AND LOWER PRICES IN BOTH WHOLESALE AND RETAIL ENERGY MARKETS. PERVASIVE COMPETITION WILL ALLOW OUR INDUSTRY TO EFFECTIVELY ADDRESS THE MAJOR ISSUES INCLUDING CLIMATE CHANGE, NEED FOR NEW GENERATION INVESTMENTS AND GRID INVESTMENTS.
Michael Kagan, President, Constellation NewEnergy
THE POWER INDUSTRY HAS BY THE THE LOWEST CAPACITY UTILITIZATION RATE AMONG CAPITAL-INTENSIVE BUSINESSES, AND ONLY COMPETITIVE RETAIL MARKETS CAN END MORE THAN A CENTURY OF INEFFICIENCY.
Mark Jacobs, CEO, Reliant Energy
Capgemini defines “the electrical energy market” as that market that includes “… generators, system operators, transmission and distribution service providers, retailers, energy service companies, consumers, regulators and legislators…”
In response to another Capgemini article (see The Smart Grid Transportation Utility), I concluded that “Dramatic and radical change is coming to the electric utility industry as the utility itself evolves to the smart transportation grid, under a complete rethinking of the electric industry. Front and back office generation and customer facing activities become free market activities under prudential regulations.”
The system operators and the transmission and distribution service providers become the integrated (T&D) transportation utility under a compact with a responsibility of transport, instead of a responsibility to serve, in exchange for a regulated price control tolls payment. The “ability to earn a return on their investments in” the transportation infrastructure under traditional regulation is without any doubt. As “[T]he current state of the electrical infrastructure in North America is not sustainable…,” the paradigm shift to EWPC will enable a sustainable smart grid transportation utility electrical infrastructure in America and the rest of the world.
Under EWPC, the investments necessary for Demand Integration (no just smart metering) will be coordinated by Second Generation Retailers. The broader set of benefits of aggregating retail demand to produce wholesale demand, refining grid planning, and improving grid monitoring and control, are part of the Demand Integration processes to power system planning, operation and control.
Instead of an artificial decoupling of the utility grid and the utility enterprise, like that under structural separation of the grid and the enterprise that lead to a Complex and Ugly System (see The Good, the Bad and the Ugly), real decoupling is produced by having distribution integrated with transmission in the transportation utility compact leading to the Good and Simple System.
As they take on today’s utilities enterprise activities on a competitive basis, 2GRs integrate the functions of retailers, load serving entities, and aggregators, increasing the efficiency and effectiveness of the whole system. Unlike utilities, competitive 2GRs will have “end-to-end responsibility and be willing to have a stake in delivering results… ” to end-customers. So, paraphrasing the author, “… [2GRs will] look beyond the technology into the opportunities and incentives the technology unlocks. Indeed, [2Grs will] take a more comprehensive view of smart metering. More important than the technology itself is the role it plays in enabling system operators, 2GRs and customers to … improve market efficiency.” 2GRs “should seek out partners who will work collaboratively with them to ensure the success…” of their business models.
Reference and context: A Fresh Approach to Managing Peak Demand, by Gary Paul, VP, Outsourcing Business Development, Capgemini
The Good, the Bad and the Ugly II
This follows up the comments on the EWPC article The Good, the Bad and the Ugly. I certainly agree with Warren Causey that the idea of demand response as a condition of service seems to be emerging. EWPC is about ending the rampant value destruction to generate large value creation.
Don,
Be a good sport. As you will see below, this is "a fascinating time-period in which to live."
EWPC is no about the left or the right. It’s about ending the rampant value destruction originated in the Old System, the Bad System, and even more the Ugly System. The Good EWPC System is about developing the resources of the demand side for innovation to flourish and generate a lot of value creation in the benefit of ALL stakeholders.
I certainly agree with Warren Causey that the idea on mandatory demand response seems to be emerging. As part of the Sierra Energy Group, his idea is to be taken seriously as he is in close contact with the private sector of the industry. It used to be called earlier in California as “demand response as a condition of service.” I don’t see how that has anything to do with left win. I think it has ALL to do with Law of the Situation: the utilities don’t understand.
This is what Warren Causey also wrote in the post All the issues crux of the matter :
With regard to good ideas dying at the utility/commission staff interfaces, I don’t disagree at all. In fact, I consider that as proof of the argument in my original post, and as both the crux of the issue and the fly in the ointment of Dr. Silverio’s, and other bloggers’, restructuring proposals. My educational training actually is in history and that’s why I consider this a fascinating time-period in which to live.
Over the last couple of generations, the U.S. has become increasingly socialist (regardless of the party in power) and people increasingly expect the government regulate everything and solve every problem. The issue with that is that government bureaucracy (and state-controlled enterprises are extensions of that bureaucracy) is inherently the worst possible way to solve any problem. You can ask the Russians what a long, slow dive into an empty swimming pool feels like. Of course don’t pay to much attention to what they say because now they seem intent on climbing, dazed, back up onto the board and trying it again.
When you introduce government planning into any operation at any level of government (local planning commissions and their interventions into private property are a nightmare) and remove or distort economic incentives, you produce a horse designed by a committee—it looks a lot like a camel. Add politics (most state regulators are elected and national politicians’ raison d’etre is to get elected regardless of the consequences) and the possibility of allowing free markets to work out problems via trial-and-error disappears.
During so-called “deregulation,” not one regulator or one “staff,” which by Mr. Pullin’s description constitutes the bureaucracy, disappeared. Don’t blame the staffs, they’re just doing what bureaucrats do!
The following is taken from the WTO Website:
Virtually all decisions in the WTO are taken by consensus among all member countries and they are ratified by members' parliaments. . . At the heart of the system — known as the multilateral trading system — are the WTO’s agreements, negotiated and signed by a large majority of the world’s trading nations, and ratified in their parliaments. These agreements are the legal ground-rules for international commerce. Essentially, they are contracts, guaranteeing member countries important trade rights. They also bind governments to keep their trade policies within agreed limits to everybody’s benefit.
Don,
Be a good sport. As you will see below, this is "a fascinating time-period in which to live."
EWPC is no about the left or the right. It’s about ending the rampant value destruction originated in the Old System, the Bad System, and even more the Ugly System. The Good EWPC System is about developing the resources of the demand side for innovation to flourish and generate a lot of value creation in the benefit of ALL stakeholders.
I certainly agree with Warren Causey that the idea on mandatory demand response seems to be emerging. As part of the Sierra Energy Group, his idea is to be taken seriously as he is in close contact with the private sector of the industry. It used to be called earlier in California as “demand response as a condition of service.” I don’t see how that has anything to do with left win. I think it has ALL to do with Law of the Situation: the utilities don’t understand.
This is what Warren Causey also wrote in the post All the issues crux of the matter :
With regard to good ideas dying at the utility/commission staff interfaces, I don’t disagree at all. In fact, I consider that as proof of the argument in my original post, and as both the crux of the issue and the fly in the ointment of Dr. Silverio’s, and other bloggers’, restructuring proposals. My educational training actually is in history and that’s why I consider this a fascinating time-period in which to live.
Over the last couple of generations, the U.S. has become increasingly socialist (regardless of the party in power) and people increasingly expect the government regulate everything and solve every problem. The issue with that is that government bureaucracy (and state-controlled enterprises are extensions of that bureaucracy) is inherently the worst possible way to solve any problem. You can ask the Russians what a long, slow dive into an empty swimming pool feels like. Of course don’t pay to much attention to what they say because now they seem intent on climbing, dazed, back up onto the board and trying it again.
When you introduce government planning into any operation at any level of government (local planning commissions and their interventions into private property are a nightmare) and remove or distort economic incentives, you produce a horse designed by a committee—it looks a lot like a camel. Add politics (most state regulators are elected and national politicians’ raison d’etre is to get elected regardless of the consequences) and the possibility of allowing free markets to work out problems via trial-and-error disappears.
During so-called “deregulation,” not one regulator or one “staff,” which by Mr. Pullin’s description constitutes the bureaucracy, disappeared. Don’t blame the staffs, they’re just doing what bureaucrats do!
The following is taken from the WTO Website:
Virtually all decisions in the WTO are taken by consensus among all member countries and they are ratified by members' parliaments. . . At the heart of the system — known as the multilateral trading system — are the WTO’s agreements, negotiated and signed by a large majority of the world’s trading nations, and ratified in their parliaments. These agreements are the legal ground-rules for international commerce. Essentially, they are contracts, guaranteeing member countries important trade rights. They also bind governments to keep their trade policies within agreed limits to everybody’s benefit.
sábado, marzo 15, 2008
Fondos de Pensión, Subsidios y Ahorro de Energía
En su editorial "Preocupante" de este 15 de marzo del 2008, el Listín Diario afirma que "Ya muchos están comenzando a presentir que . . . el plan de pensiones como los servicios de salud, serán solamente un nuevo impuesto y al final todo ciudadano tendrá que pagar un servicio marginal que será el que realmente supla sus necesidades."
La Bitácora Digital del GMH cumple hoy 34 meses en su labor de divulgación y los temas de los fondos de pensión, el ahorro de energía y el de los subsidios, siguen siendo de mucha actualidad e importancia, especialmente cuando el petróleo está por las nubes y los Estados Unidos están en medio de lo que parece cada vez más una gran depresión y una crisis sistémica de su sistema financiero.
Los fondos de pensión dominicanos pueden colaborar grandemente con la solución de la crisis sistémica del sector eléctrico, para reforzarse mutuamente de forma positiva. Dado que la capitalización no genera los incentivos para que los consumidores inviertan en ahorro de energía, la profundización de la reforma debería facilitarla y en ese sentido los fondos de pensión podrían asegurar medios para incrementar grandemente su rentabilidad, al tiempo que le reducen los costos de electricidad a los propios trabajadores y permiten focalizar y reducir los subsidios a la población. Esa es la idea innovadora que evitaría que los planes de pensión se conviertan en un nuevo impuesto invirtiendo en el ahorro de energía y generando grandes beneficios en el sistema interconectado con la profundización de la reforma que no son obvios todavía.
Anteriormente, Gustavo Alba Sánchez en respuesta a la nota Una Crítica Eléctrica al Discurso Presidencial, propuso "en linea con tu aserto de que falta financiamiento para promover medidas tendentes al ahorro de energia, creo que si gran parte del financiamiento que ahora se destina a compras de automoviles se dedicara a equipos domesticos de mayores eficiencia energetica, y aun mas, a paneles solares y molinos de vientos que asociados a los ya existentes bancos de baterias e inversores en muchos hogares dominicanos, podrian constituirse en un conjunto generador de gran impacto en el ahorro de combustible fosil." Mi respuesta a su propuesta que aparece a seguidas debajo de esa nota, se sintetiza en la necesidad de la profundización de la reforma para alinear los incentivos y reducir grandemente el impacto negativo de la costosa política que ha generado el gran mercado sálvese quien pueda de soluciones individuales.
Como dije en HOY ECONOMÍA - Detengamos el hurto, "El problema nodal es estructural. Uno de los elementos estructurales defectuosos es precisamente la distribuidora y su ineficiente modelo de negocios que no está diseñado para servir al público y que invita a los subsidios del gobierno." También explique en "HOY ECONOMÍA - El hurto no es el problema que "Aunque los detallistas ofrecerán un servicio individual, en zonas de hurto elevado se hará al transformador más cercano, facilitando el proceso." Por eso, como la profundización de la reforma desarrolla un servicio individual al cliente y permite a su vez focalizar los subsidios de forma clara y transparente, y sin que sea a través de los precios de electricidad.
En ese sentido, el GMH invita al diálogo y al debate, recordando varias notas colocada en esta Bitácora Digital y resumiendo abajo algunas ideas tomadas de las estadísticas de la Asociación Internacional de Organismos de Supervisión de Fondos de Pensiones (AIOS) que aparecen en su Boletín 17.
Síntesis: Solución Energética Sistémica
Cooperativas Eléctricas, Normas Prudenciales y Fondos de Pensión
8 Notas Sobre Fondos de Pensiones
La AIOS es una entidad civil sin fines de lucro, compuesta por los organismos de supervisión de los sistemas de pensiones de capitalización individual de los siguientes países: Argentina, Bolivia, Chile, Colombia, Costa Rica, El Salvador, México, Panamá, Perú, República Dominicana y Uruguay.
Mientras el promedio de los miembros de la AIOS tienen 21.6% de sus fondos invertidos en moneda extranjera, el país al igual que El Salvador no tienen un centavo fuera. La inversión en empresas extranjeras que producen equipos de eficiencia energética que sean seleccionados por su alto potencial generaría una relación mutua de rentabilidad.
De julio 2006 a julio 2007, las utilidades en términos del patrimonio neto resultaron 7.1%, estando por debajo del promedio de los 10 países que fue de 17.1%. La rentabilidad bruta real del mismo período fue de tan solo 3.3%, lejos de Perú con 51.4%, Chile 20.8%, Argentina 18.5%, Mexico 11%, Uruguay 8.5%.
La Bitácora Digital del GMH cumple hoy 34 meses en su labor de divulgación y los temas de los fondos de pensión, el ahorro de energía y el de los subsidios, siguen siendo de mucha actualidad e importancia, especialmente cuando el petróleo está por las nubes y los Estados Unidos están en medio de lo que parece cada vez más una gran depresión y una crisis sistémica de su sistema financiero.
Los fondos de pensión dominicanos pueden colaborar grandemente con la solución de la crisis sistémica del sector eléctrico, para reforzarse mutuamente de forma positiva. Dado que la capitalización no genera los incentivos para que los consumidores inviertan en ahorro de energía, la profundización de la reforma debería facilitarla y en ese sentido los fondos de pensión podrían asegurar medios para incrementar grandemente su rentabilidad, al tiempo que le reducen los costos de electricidad a los propios trabajadores y permiten focalizar y reducir los subsidios a la población. Esa es la idea innovadora que evitaría que los planes de pensión se conviertan en un nuevo impuesto invirtiendo en el ahorro de energía y generando grandes beneficios en el sistema interconectado con la profundización de la reforma que no son obvios todavía.
Anteriormente, Gustavo Alba Sánchez en respuesta a la nota Una Crítica Eléctrica al Discurso Presidencial, propuso "en linea con tu aserto de que falta financiamiento para promover medidas tendentes al ahorro de energia, creo que si gran parte del financiamiento que ahora se destina a compras de automoviles se dedicara a equipos domesticos de mayores eficiencia energetica, y aun mas, a paneles solares y molinos de vientos que asociados a los ya existentes bancos de baterias e inversores en muchos hogares dominicanos, podrian constituirse en un conjunto generador de gran impacto en el ahorro de combustible fosil." Mi respuesta a su propuesta que aparece a seguidas debajo de esa nota, se sintetiza en la necesidad de la profundización de la reforma para alinear los incentivos y reducir grandemente el impacto negativo de la costosa política que ha generado el gran mercado sálvese quien pueda de soluciones individuales.
Como dije en HOY ECONOMÍA - Detengamos el hurto, "El problema nodal es estructural. Uno de los elementos estructurales defectuosos es precisamente la distribuidora y su ineficiente modelo de negocios que no está diseñado para servir al público y que invita a los subsidios del gobierno." También explique en "HOY ECONOMÍA - El hurto no es el problema que "Aunque los detallistas ofrecerán un servicio individual, en zonas de hurto elevado se hará al transformador más cercano, facilitando el proceso." Por eso, como la profundización de la reforma desarrolla un servicio individual al cliente y permite a su vez focalizar los subsidios de forma clara y transparente, y sin que sea a través de los precios de electricidad.
En ese sentido, el GMH invita al diálogo y al debate, recordando varias notas colocada en esta Bitácora Digital y resumiendo abajo algunas ideas tomadas de las estadísticas de la Asociación Internacional de Organismos de Supervisión de Fondos de Pensiones (AIOS) que aparecen en su Boletín 17.
Síntesis: Solución Energética Sistémica
Cooperativas Eléctricas, Normas Prudenciales y Fondos de Pensión
8 Notas Sobre Fondos de Pensiones
La AIOS es una entidad civil sin fines de lucro, compuesta por los organismos de supervisión de los sistemas de pensiones de capitalización individual de los siguientes países: Argentina, Bolivia, Chile, Colombia, Costa Rica, El Salvador, México, Panamá, Perú, República Dominicana y Uruguay.
Mientras el promedio de los miembros de la AIOS tienen 21.6% de sus fondos invertidos en moneda extranjera, el país al igual que El Salvador no tienen un centavo fuera. La inversión en empresas extranjeras que producen equipos de eficiencia energética que sean seleccionados por su alto potencial generaría una relación mutua de rentabilidad.
De julio 2006 a julio 2007, las utilidades en términos del patrimonio neto resultaron 7.1%, estando por debajo del promedio de los 10 países que fue de 17.1%. La rentabilidad bruta real del mismo período fue de tan solo 3.3%, lejos de Perú con 51.4%, Chile 20.8%, Argentina 18.5%, Mexico 11%, Uruguay 8.5%.
jueves, marzo 13, 2008
The Good, the Bad and the Ugly
The California commissioners need to shift their mindsets “to show that retail competition is not only possible, but absolutely necessary to turn the electricity industry into a vibrant value added business for all stakeholders.” That is the EWPC story that emerged from a generative dialogue, enriching the debate between the story of incumbent utilities and the story of the coalition.
The Good, the Bad and the Ugly
By José Antonio Vanderhorst-Silverio, Ph.D.
Systemic Consultant: Electricity
First posted in the GMH Blog, on March 13th, 2008.
Copyright © 2008 José Antonio Vanderhorst-Silverio. All rights reserved. No part of this article may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopying and recording, without written permission from José Antonio Vanderhorst-Silverio. This article is an unedited, an uncorrected, draft material of The EWPC Textbook. Please write to javs@ieee.org to contact the author for any kind of engagement.
The summary of the EWPC article The BIG California LIE says “The BIG LIE is that retail competition is impossible in electric markets. The implementation of a competitive retail market was the center of the debate in California. Instead of cooperating to implement it, the three big California utilities, that didn't care about the end-costumers, acted very irresponsibly. EWPC is the paradigm shift to show that retail competition is not only possible, but absolutely necessary to turn the electricity industry into a vibrant value added business for all stakeholders.”
As I said in the EWPC article High Leverage Shake-Up in California, to which this article is a follow up, I am changing the opinion of “Instead of cooperating to implement it, the three big California utilities, that didn't care about the end-costumers, acted very irresponsibly,” since the utilities were not alone, but were also prisoners of the system like FERC and the PUC.
The good news is that the PUC is trying to amend the BIG LIE, by working hard to show the whole world that retail competition is possible. But to show it, the powerful commissioners will need to change their mindsets with a paradigm shift to EWPC.
So, I agree everyone should get both sides of the story. But there are not only an advocate and an opponent, as it was to be. To make things simple, I will say that there are only three sides to the story, the Good, the Bad and the Ugly.
The EWPC’s System: the Good System emerged as a Simple System.
This is an emergent story. The aim is a high leverage systemic transformation to insert the power industry in the third industrial revolution. The leverage is to come from the development of business model innovations, including the smart grid, that mutually reinforce themselves.
The Simple System leaves the transportation grid – a natural monopoly – as the integrated transportation only utility, that takes the central stage from generation by fulfilling an ultraquality imperative. Ultraquality transportation is a characteristic of the system for high power quality and system reliability, and not a characteristic of the unreliable parts like the generating units.
The smart grid transportation utility will provide for the long-term stability needed for investments in the power system, eliminate cross-subsidies and avoid unintended consequences, by providing a fundamental systemic solution to the worldwide electric industry systemic crisis. Generation and retail become fully competitive activities in the open market. No customer gets discriminated.
My story: “EWPC is the paradigm shift to show that retail competition is not only possible, but absolutely necessary to turn the electricity industry into a vibrant value added business for all stakeholders.”
The incumbent’s System: the Bad System is an evolution of the Old System.
This story is lead by the three California utilities, which have a lot of power and have the California legislators - the status quo - in their side. The Bad System has large power customers who had already signed direct access contracts, but discriminates everybody else to remain as utility customers.
The incumbent utilities’ story: “… expanded direct access could undermine the long-term stability needed for investments in the power system, shift costs from one group of customers to another and produce unintended consequences such as the failed deregulation." I agree that it is to be expected with a symptomatic solution of the systemic crisis, resulting by remaining imprison by the generation centered stage utility system.
The Coalition System: the Ugly System is a very Complex System.
This story is led by a coalition of power companies and government agencies that now wants to revive the “direct access” part of the failed deregulation experiment. The CPUC is looking for a symptomatic solution within the boundaries of the present imprisoning system.
Competition was closed in California until 2017 when the long term contracts between the California Department of Water Resources expire. But the PUC decided to look at whether the contracts could be assigned to someone else, such as the utilities. Such symptomatic solution is bound to be a low leverage system intervention, that increases even more the complexity of the existing system.
The coalition story: “…direct access allows customers to choose rates and services that help them compete and manage risks while developing a broad power market that can provide more options and lower prices for customers.” This is not possible with structural separation as the Carnegie Mellon Electricity Industry Center working paper showed. To make it possible a paradigm shift to EWPC is needed.
The Good, the Bad and the Ugly
By José Antonio Vanderhorst-Silverio, Ph.D.
Systemic Consultant: Electricity
First posted in the GMH Blog, on March 13th, 2008.
Copyright © 2008 José Antonio Vanderhorst-Silverio. All rights reserved. No part of this article may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopying and recording, without written permission from José Antonio Vanderhorst-Silverio. This article is an unedited, an uncorrected, draft material of The EWPC Textbook. Please write to javs@ieee.org to contact the author for any kind of engagement.
The summary of the EWPC article The BIG California LIE says “The BIG LIE is that retail competition is impossible in electric markets. The implementation of a competitive retail market was the center of the debate in California. Instead of cooperating to implement it, the three big California utilities, that didn't care about the end-costumers, acted very irresponsibly. EWPC is the paradigm shift to show that retail competition is not only possible, but absolutely necessary to turn the electricity industry into a vibrant value added business for all stakeholders.”
As I said in the EWPC article High Leverage Shake-Up in California, to which this article is a follow up, I am changing the opinion of “Instead of cooperating to implement it, the three big California utilities, that didn't care about the end-costumers, acted very irresponsibly,” since the utilities were not alone, but were also prisoners of the system like FERC and the PUC.
The good news is that the PUC is trying to amend the BIG LIE, by working hard to show the whole world that retail competition is possible. But to show it, the powerful commissioners will need to change their mindsets with a paradigm shift to EWPC.
So, I agree everyone should get both sides of the story. But there are not only an advocate and an opponent, as it was to be. To make things simple, I will say that there are only three sides to the story, the Good, the Bad and the Ugly.
The EWPC’s System: the Good System emerged as a Simple System.
This is an emergent story. The aim is a high leverage systemic transformation to insert the power industry in the third industrial revolution. The leverage is to come from the development of business model innovations, including the smart grid, that mutually reinforce themselves.
The Simple System leaves the transportation grid – a natural monopoly – as the integrated transportation only utility, that takes the central stage from generation by fulfilling an ultraquality imperative. Ultraquality transportation is a characteristic of the system for high power quality and system reliability, and not a characteristic of the unreliable parts like the generating units.
The smart grid transportation utility will provide for the long-term stability needed for investments in the power system, eliminate cross-subsidies and avoid unintended consequences, by providing a fundamental systemic solution to the worldwide electric industry systemic crisis. Generation and retail become fully competitive activities in the open market. No customer gets discriminated.
My story: “EWPC is the paradigm shift to show that retail competition is not only possible, but absolutely necessary to turn the electricity industry into a vibrant value added business for all stakeholders.”
The incumbent’s System: the Bad System is an evolution of the Old System.
This story is lead by the three California utilities, which have a lot of power and have the California legislators - the status quo - in their side. The Bad System has large power customers who had already signed direct access contracts, but discriminates everybody else to remain as utility customers.
The incumbent utilities’ story: “… expanded direct access could undermine the long-term stability needed for investments in the power system, shift costs from one group of customers to another and produce unintended consequences such as the failed deregulation." I agree that it is to be expected with a symptomatic solution of the systemic crisis, resulting by remaining imprison by the generation centered stage utility system.
The Coalition System: the Ugly System is a very Complex System.
This story is led by a coalition of power companies and government agencies that now wants to revive the “direct access” part of the failed deregulation experiment. The CPUC is looking for a symptomatic solution within the boundaries of the present imprisoning system.
Competition was closed in California until 2017 when the long term contracts between the California Department of Water Resources expire. But the PUC decided to look at whether the contracts could be assigned to someone else, such as the utilities. Such symptomatic solution is bound to be a low leverage system intervention, that increases even more the complexity of the existing system.
The coalition story: “…direct access allows customers to choose rates and services that help them compete and manage risks while developing a broad power market that can provide more options and lower prices for customers.” This is not possible with structural separation as the Carnegie Mellon Electricity Industry Center working paper showed. To make it possible a paradigm shift to EWPC is needed.
Suscribirse a:
Entradas (Atom)