Topic 7 Electricity Flashcards
(21 cards)
What factors could be contributing to falling energy demand from UK households?
- Economic weakness
- Energy efficiency policy e.g. LED’s
- Higher Energy prices
- non-price behavior change
What is the inverse of the diversity factor?
The coincidence factor
What are the three sections of the load duration curve?
- Base load
- Intermediate load
- Peak load
What is unique about the power sector
Difficult to store economically - demand has to be met by modulating supply to meet demand
Define load profile
Pattern of electricity usage for a segment of supply market customers
Name three plants with high capital costs
Coal, Hydro, Nuclear
What do coal and nuclear plants have in common?
Take time to start up and shut down hence not suitable for fluctuating loads of system frequencies
Define generation capacity reserve
The additional amount of capacity that has to be maintained at any time in addition to current demand. It allows for errors.
What are some issues that indivisibility of capital bring about?
- Booms and busts
- Affect investment decisions
- Economic uncertainties
What substances can coal emit?
Carbon dioxide, sulphur dioxide, particulate matter, nitrous oxides, mercury, cadmium and arsenic
What is a natural monopoloy
Production of a good or service by a single firm ensures least cost supply (long run average cost declines across all outputs). Another requirement for a natural monopoly is sub additivity.
What are issues associated with a monopoly?
- Price > Marginal cost
- May choose factors of production in an inefficient manner
- Rent seeking causes lobbying
- Product differentiation can be a allocation of resources
Define temporary natural monopoly
AC falls over a limited range of output (constant thereafter)
What are two problems of integrated utility companies?
- No incentive to be efficient (pass through rates)
- No incentive not to over invest in plant capacity (guaranteed return)
Both result in higher cost electricity
What would be needed if natural monopolies are acceptable?
- Marginal cost pricing
- Public ownership
- Regulation
What are some of the problems with public ownership?
Inefficient, poor labor productivity, poor service
What is unbundling?
Separating natural monopoly elements (transport, transmission and distribution) from competitive elements (generation and supply/retail)
When was full competition introduced into Britain’s electricity retail market?
1999
What did Waddams 2005 conclude?
- A small number of suppliers retain considerable market power
- Prices charged to consumers are significantly above competitive level
What does a smart meter do?
A smart meter can tell the occupant of a house or manager of a factory, what the real time cost of electricity is
What is a smart grid and what could it do?
An electricity supply network that uses digital communications technology to detect and react to local changes in usage.
Control timing of recharging etc… in order to maintain an overall even electricity load
