alt Hacker NewsAren't power prices determined by the most expensive power source (i.e. gas) regardless of the prices of all other power sources? Otherwise nuclear/hydroelectric would be sold for pennies, no?
Replies
wat10000 • today at 2:29 PM
It's not a constant, because you don't always need the most expensive sources. If you have a sunny afternoon where there's enough solar power to cover demand without gas plants, then you don't have to pay gas rates for that time.
Generally, yes. There's a simple reason why: it stops producers trying to "holdout" in order to drive prices up. Various countries are thinking of changing this to modified auction systems in order to deal with greater and greater disparities between prices.