Daily Archives: February 23, 2010

Inside the ERCOT control center

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Michael Giberson

David Wagman, chief editor of Power Engineering magazine, toured the Electric Reliability Council of Texas’ primary control center in Taylor, Texas as part of a group attending the Renewable Energy World Conference in Austin.  If you wonder what ERCOT’s control center is like:

Inside the control room, the most striking feature is the lack of noise. The room, which must be 50 by 50 with a 35-foot ceiling, is library quiet. And that’s the way they like it, Joel Mickey told me in a video interview I filmed with him and which will be on this web site in the near future. Anything else suggests a system that’s out of balance or with a problem. Eight people work in the control room, responsible for everything from day-ahead forecasting to on-the-spot transmission balancing. Each has a bank on consoles.

The front wall consists of a massive projection screen with perhaps a dozen displays showing the grid and various real time operating conditions. Two digital displays at either side of the room report the current load, the time and the system’s cycle. Those numbers in particular move up and down within a narrow range around 60 cycles. Every four seconds the control center pulses commands to generating units around the state, commanding changes in generating output up or down to keep 60 cycles in the center of the target.

More at the link, including some description on how wind power is changing the system operator’s job.

(HT to the Caprock Plains Wind Energy Association.)

Tickets into the olympics

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Michael Giberson

Ticket scalping, like price gouging, is a usually pro-social market activity that is stuck with a pejorative name.  At Swifter, Higher, sportswriter Kyle Whelliston writes about his experience picking up a cheap ticket into the first hockey game of the Vancouver Olympics.  It wasn’t as easy as he hoped, but at a cost of missing the first few minutes of action he was able to get a price he liked.

What surprised me in the article was how well organized the gray-market activity was. I wonder whether the Olympics would increase or decrease overall ticket revenue by facilitating an active secondary market (assuming a secondary market was legal in the host country).

(Via Freakonomics blog.)

Information costs and snowfall data

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Lynne Kiesling

Here’s a paper that befits the snowy month we’ve had in the U.S. … Jonathan Zinman and Eric Zitzewitz at Dartmouth find that ski resorts over-report snowfall, and that the proliferation of iPhones has led to more consumer information on accurate snowfall and ski conditions. The paper abstract:

Casual empiricism suggests that deceptive advertising is prevalent, and several classes of theories explore its causes and consequences. We provide some unusually sharp empirical evidence on the extent, mechanics, and dynamics of deceptive advertising. Ski resorts self-report 23 percent more snowfall on weekends; there is no such weekend effect in government precipitation data. Resorts that plausibly reap greater benefits from exaggerating do it more. We find little evidence that competition restrains or encourages exaggeration. Near the end of our sample period, we observe a shock to the information environment: a new iPhone application feature makes it easier for skiers to comment on resort ski conditions in real time. Exaggeration falls sharply, especially at resorts where iPhones can get reception.

This kind of empirical economic research is particularly valuable, because it highlights the role that technology can play in enabling the aggregation of dispersed information, which better enables reputation mechanisms to discipline otherwise deceptive behavior. In many contexts this combination of technology and diffuse information feeding into a reputation mechanism provides more effective regulation than some form of centralized, government regulation. Imagine, for example, a law requiring ski resorts to report accurate conditions, with an entire agency established to monitor and enforce their compliance. Likely to be much more expensive, and less effective, than the simple threat of losing weekend business!

Hat tip to Salon article on the research.