Futurepundit: Peak Shifting Requires Regulatory Reform

Lynne Kiesling

Boy oh boy, Randall is really barking up my tree in this post on the cost-saving benefits of precooling buildings!

Some of the technology developments needed to allow demand shifting are pretty low tech. It is easy to develop a computer program that will vary the thermostat setting as a function of the time or day and not much harder to develop software and a communications system to broadcast marginal prices so that companies could adjust their demand as a function of current electric prices. The bigger obstacle is at the policy level, not the technological level.

If public utilities were to more widely implement dynamic pricing of electricity then businesses would pretty quickly implement lower tech methods of adjusting demand. At the same time, incentives would then come into existence to develop better technologies for shifting demand. For example, the value of better battery technologies would increase and therefore dynamic pricing would accelerate the development of better battery technologies.

An acceleration of battery technology development in response to dynamic electric pricing would eventually accelerate the shift toward hybrid and pure electric cars. Increased demand for electric power storage technologies would increase investment to develop such technologies.

The deployment of technologies and business practices that allow rapid demand adjustment in response to dynamic pricing would be bullish for both solar and wind electric power. Businesses would treat rises in electric prices that happen when the sun isn’t shining or the wind isn’t blowing as reason to shift business activity (or accumulation of energy in batteries or cool or heat in previously mentioned building masses) toward the times when the sun does shine and the wind does blow. To put it another way: if demand can be made more dynamic by market forces then the inconstancy of solar and wind power would pose less of a problem for their wider spread adoption. Greater market forces in electric power distribution would accelerate energy technology development and deployment.

Couldn’t have said it better myself. Really.

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2 thoughts on “Futurepundit: Peak Shifting Requires Regulatory Reform”

  1. >>An acceleration of battery technology development in response to dynamic electric pricing would eventually accelerate the shift toward hybrid and pure electric cars.

    Ah, no. There is PLENTY of existing demand for better batteries. A change in energy policy isn’t go to suddenly change the laws of physics.

    Batteries are getting better at a very slow rate, and all the demand in the world can’t change that. Consumer electronics and laptops are the drivers of battery development.

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    John M

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