> If you moved the ownership and control of the transmission network and all generators into a single operator that was responsible for optimising its operation in near-real-time and that bore all the costs within a single accounting perimeter, it would do more or less what the the existing market based mechanism does: turn off the wind generators and instruct the thermal plants in the South to run instead.
But it wouldn't count a profit in the North and build yet another pointless wind turbine in the North. Whereas the current system, because it pays the Northern producer the market rate, for electricity that isn't needed, shape the grid in a nonsensical way! That's the core of the criticism.
> Of course you could argue that this efficient single operator simply wouldn't have built the wind assets in the first place in a location where they often couldn't run but that assumes that the same policy makers who created the current outcome wouldn't have engineered the exact same outcome through the direct control they presumably would have had of the integrated operator.
There's literally no reason to assume they would have done the same choice given they would have responded to completely different incentives (minimizing the total cost, instead of individual actors maximizing their profit under the artificial price scheme).
But it wouldn't count a profit in the North and build yet another pointless wind turbine in the North. Whereas the current system, because it pays the Northern producer the market rate, for electricity that isn't needed, shape the grid in a nonsensical way! That's the core of the criticism.
> Of course you could argue that this efficient single operator simply wouldn't have built the wind assets in the first place in a location where they often couldn't run but that assumes that the same policy makers who created the current outcome wouldn't have engineered the exact same outcome through the direct control they presumably would have had of the integrated operator.
There's literally no reason to assume they would have done the same choice given they would have responded to completely different incentives (minimizing the total cost, instead of individual actors maximizing their profit under the artificial price scheme).