Negative Electricity Supply

Negative electricity prices happen when supply outstrips demand and we literally don’t know where to put it,” Peter Smits, head of central Europe at Swiss power-equipment maker ABB Ltd., said in an interview on April 20 in Hanover. “We will see this happen more often in the future.” 

…Storing electricity may be another fix. In Scandinavia, Danish wind power is used to pump water into Norwegian and Swedish reservoirs and later released to drive hydroelectric plants when the wind is not blowing. 

…Wind’s impact on prices results from its “low marginal costs,” which pushes more expensive technologies including natural gas and coal out of the market, the Poeyry study said. Fossil-fuel burning relies on fuel, which can boost the price of electricity from those sources. 

Texas had so-called negative power prices in the first half of 2008 because wind turbines in the western part of the state weren’t adequately linked with more populated regions in the east, according to the Electricity Reliability Council of Texas. 

Until there’s more integration and better transmission grids, prices probably will fluctuate, leading to negative prices, in which payment to consumers is reflected as a discount on their monthly bills.

Article here.