Summary
Join Pam, Ben and James as they turn up the voltage on a fun, electrifying chat! Starting off with a quick dive into the difference between kW and kWh, the team then converts energy usage of different items in toaster SI units. They shed light on the journey of energy from generation to your home, in the very first squadcast game - dish out some electrifying acronyms (and admit when they’re stumped), and explore the bustling world of electricity markets. And if you've ever imagined the ISO as a bar, you're not alone. Pam even shares her experience of ringing up San Diego Gas and Electric’s demand response line. Whether you're a seasoned electric buff or just plugging in, this chat promises high energy, high voltage, and high fun!
Episode chapters:
(2:16); kW’s and kWh’s explained
(6:23): Toaster energy use for scale
(10:31): Generation, transmission and distribution
(22:15): What’s that acronym?: Part one
(33:40): The three North American grids
(35:40): Balancing authorities, ISO and RISOTO
(37:58): Utilities + Pam calls San Diego Gas and Electric
(41:48): Sub-utility and ISO zones
(44:39): Electricity markets
(59:44): Whole deregulated market types
(1:02:36): The ISO is just a bar
(1:05:00): Deregulated retail markets
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Relevant links we found helpful
The basics of electricity
Moving Electricity: The Three Steps of the Grid
https://www.eia.gov/energyexplained/electricity/electricity-in-the-us.php
https://www.eia.gov/state/
See a map of all the electricity providers in the USA here.
The US Grid
The “seams” of the grid
f you want to learn more about BAs (all 66 of them in the US), check out these great links by the EIA: here and here. Balancing authorities are typically ISOs/RTOs, or utilities.
https://www.e-education.psu.edu/eme801/node/534
FERC: https://www.ferc.gov/power-sales-and-markets/rtos-and-isos
Buying and Selling Electricity: Energy Markets
https://en.wikipedia.org/wiki/Electricity_meter
https://en.wikipedia.org/wiki/Electricity_pricing
https://en.wikipedia.org/wiki/Independent_power_producer
https://www.energysage.com/other-clean-options/retail-energy-providers/
https://www.ferc.gov/electric-power-markets
https://en.wikipedia.org/wiki/Peaking_power_plant#:~:text=Peaking%20power%20plants%2C%20also%20known,as%20peak%20demand%2C%20for%20electricity.
https://competitiveenergy.org/consumer-tools/state-by-state-links/
Grid Governance
https://www.nerc.com/Pages/default.aspx
Music
Our incredible intro/outro music is the song Ticking, by artist TIN
You can stream the whole song and the rest of their catalog here:
Episode transcript
I see voltage i see current no i see math no no intro the episode oh i thought you meant do the now we'll make ben do the formulas it's fine i saw math and i saw i saw math and i saw variables and i said no what are those things that we have now available that are be worked in quite a different way into the economy of the united states which are concerned primarily with the design of nuclear power plants and this type of thing. Hi, I'm Pamela Wildstein. I'm Wyatt Makaronski. I'm Ben Hillborn. I'm James Gordey. You're listening to Intermediate. Intermediate. Intermediate. To Intermediate. Intermediate. The place for people trying to get into or already working on distributed energy resources and clean energy. This is the podcast that makes it easy to learn how the grid actually works beyond the office. Welcome to Intermediate. Hey Pam, how's it going? Terrible, I have to do the intro. Tell me about the weather in Michigan this week. It hailed aggressively for multiple days. Well, it didn't ha- no, it rained really aggressively. There were a bunch of days with tornado warnings and then it hailed. That is surprisingly similar to the weather that Alberta got the past week or so. Tons of tornado warnings, just a massive amount of hail that shredded everybody's vegetables and whatnot. It's just kind of a miserable midsummer weather. It's hot. We're here to help. Yeah. Pam, what are we talking about today? We're doing an introduction to the electric grid, an overview of the whole system. The whole thing. Whole thing. Are we going to put out the accompanying blog post that we wrote a couple months ago on this? Are we? Yeah, I think we should. Right? Oh, okay. That's good work. And there will be a blog post, a blog post. Very nice. Two for the price of one. Yeah, we'll do everything from interconnections to physics. All right, is that leading into me doing some physics? Yeah. Yeah, do the formulas, Ben. No, I hate the formulas. Tell them how the math works. Okay, all right. If you've made it this far and you don't know electricity works. Well, I mean that's kind of why we're doing this. That's me. I made it this far and I don't know how it works. Pam, you're busy scheming how to write policy around the stuff. Ben, explain the basics of electricity to us with the formulas. Like we're in, I don't know, we're 10 or something, maybe five, maybe 10. All right, so the important metric in in energy systems is power. There's a lot of, there are a lot of pieces of the puzzle you can go into inductance and reluctance and we're not talking about any of that today. We're just gonna talk about power, which is current times voltage. Everybody's heard of amps, everyone's heard of volts. You know, most people listening to this podcast know that hey, my house has 120 volts at the outlet. And, you know, maybe you know that your hairdryer or toaster takes 15 amps because it said so on the box because sometimes people do that. So the terms that you need to know most clearly to work in, even to simply understand energy systems are kilowatts and kilowatt hours. And the difference here is kilowatts, I guess, watts is the base SI unit in kilowatts is like, that's a thousand watts. And that's a measure of power. That is a measure of the, call it the capacity to do work. And if you think about the easiest analogy to this for most people is plumbing because everybody's used to turning on a tap. When you turn on a tap, how fast the water comes out, that's your kilowatts. That is the speed at which the energy is leaving the source and going to the receiving device, we'll call it. On the other hand, you have kilowatt hours. ignore the the reason for the hours for a second but a kilowatt hour is a measure of capacity so now if you think about okay I you know stopper the drain I turn on the the tap and I fill up my sink the amount of water in the sink that is my kilowatt hours that's how much energy I have accumulated in one spot and now the reason for the hours on the end of it is actually really math if you turn on your tap and you turn it on to one kilowatt amount of flow and you left it on for one hour and let's say that that filled a bathtub the capacity that the amount of water that ends up in that bathtub after an hour that's one kilowatt hour so the the flow of energy times the amount of time it flows for tells you how much you can you've accumulated or used in that So that's your kilowatts versus kilowatt-hours. People are squinting. Can that go all the way down to like a second or whatever you want it to be, right? And you just take like this amount of time times the power for that period of time. Is that how it works? Yeah, that's the beauty of SI units, right? Where I can say if it makes sense for my application, I can talk about watt seconds or, you know, kilowatt years. Um, it's, it, it all works. Some of those units might not be super commonly used. Um, but people, people will know what you're talking about. Should we give people a sense of scale, like make it a bit real for different things they might relate to? For context, for context, the average home uses 1.25 kilowatts or 1.25 kilowatt hours per hour, hours per hour is going to confuse people. That's what it is. that's what it is that's what it is no we've got some nice in the blog post or we've got some nice charts a light bulb 60 watts um well that's you know that's pretty old school not too many people are using incandescent bulbs anymore what's so what's a modern light bulb then what do you think like five watts five watts okay we gotta update our chart EV charging, level one, 2.3 kilowatts, DC fast charge, more like 30 to way more than 30. Way more than 30. Yeah, so let's, I don't know, the things that things that people use every day. So you know, your average like little desk lamp LEDs is five watts. Your iPhone might charge at 10 watts. your toaster which is like one of the one of the highest draw appliances that you can you can plug into a standard household receptacle that's between 1500 1500 and 1800 watts so at the top end that's 1.8 kilowatts and the reason for that is you know electrical code and limits on that on wiring of your house the beyond that you're just you're looking at bigger things that you know most people might not necessarily have have exposure to or or experience with but those are like that's what the average person would would understand beyond that yeah like you like you said you've got like a DC fast charger call that a hundred kilowatts you want to understand how electricity it takes to like crash a grid um what would crash tech the texas grid during the 2021 february freeze was a 30 gigawatt loss of natural gas generating capacity when you add everything else that they lost too because they lost i think some nuclear too and some wind it ended up being 40 gigawatts so that's how you crash your grid that is insane Okay, so Giga is billion. Billion watts, so million kilowatts. In the Texas freeze, they lost the generating capacity of approximately 26 million toasters. And it was like that. Just offline. Like that. Like 1 a.m. or something. Crazy like that. It was 2 a.m. 26 million toasters to take down the grid. Only in Texas though. Only in Texas, yeah. And Pam, you'll be able to tell us why that's why this only happens in Texas a little bit later. Yes. Yes. Okay, so now that you know the difference between watts and watt hours, or kilowatts and kilowatt hours, another place that you will start to see this more and more often, and we talk about this in our EV episode as well is the rate that an EV can charge at, which is kilowatts, and the capacity of its battery, which is kilowatt hours.
So the, call it the average EV will add a fast charger. Let's call it, it will charge at 50 kilowatts. And if that EV has a 50 kilowatt hour battery, which I think is around like a Nissan Leaf or a Chevy Bolt or something like that, that they're in that ballpark, It'll take you an hour to charge up, give or take, and there are complexities to that because of charge curves and whatnot, but we'll get into that at a later date. But that's the rough math that you can understand. So now that you know what power is and how it's measured, now we have to talk about how it moves. Yeah, this is the grid, right? What's the grid? Yeah, how does it get from point A to point B? Come on, the grid. We know what the grid is. It's the greatest, the greatest machine ever built. Yeah. Yeah. That quote by every physics or every energy professor ever. I was going to ask you if you could read that. Yeah, it's the obligatory. Like if you're on a podcast and you have some like insert entrepreneur or other person talk about like, they're about to say about how the grid is really bad or like why it's changing and they're going to help fix a part of it. They say the grid as it exists, the greatest machine ever invented, at least man-made accomplishment in the 1900s, right? And then they produced you to talk about all those things. All those things wrong. Okay, why is it the greatest machine ever built? Let's contextualize that for people. Because all the other machines rely on this machine. Ooh, okay. The base machine. Yeah, that's a good take. Yeah. That is a good take. That's the geographers' take. I also, the way I like to think about it is, and I think we might talk about this at some other point the you know how we talked about why why power factor can crash a generator remember how we talked about that no yes okay we will come back to that anyways the the idea being that the you can actually you can think of the wires between the phone that you plugged in and the natural gas turbine that's you know a hundred miles away as a physical connection it is a physical connection electrons are physical things and when you have an input at one end some conduit for that for that power and then an output that does meaningful work like that's that's a machine and when you zoom out and you look at this as like there is one machine with countless tentacles that covers the entire continent not only this continent but every continent except probably Antarctica I don't know how the grid works in Antarctica we'll do an said but the this it's all one thing it is all one machine and that part just blows my mind a good metaphor is I always think like the circulatory system in our bodies about how everything's connected and how it keeps the blood pumping through your veins almost keeps their frequency and the way that the grid keeps one at 60 Hertz and all the different generators are almost like little mini hearts across the country all just pumping electrons throughout system. Okay, so you generate the power at one point, you move it to another point with transmission, and then you distribute it to its to its end point. And so, James, what tell us about generation? Well, I identify as a millennial, and the ones for us are the boomers. Yeah, so we've got to generate electrons, the old way to do it, or what most of our is today is nuclear power and then fossil fuel stuff where I started my career so coal but increasingly kind of renewables and natural gas as well hopefully not increasingly natural gas but definitely increasingly renewables and clean sources and so most of the grid today is still like fossil fuels like 60 percent is what this chart says nuclear hanging on at 19 percent although there's some activists that would have it go the other way, and some venture capitalists who say just have it, a million nuclear reactors and we're all good, which they do in some countries like in France. But then increasingly we have these renewables, right? Wind, solar, geothermal, hydro up here in the Northwest, like Seattle City Light, which is the electricity utility here in Seattle. We have like 94% clean energy, which is like best in the country for any place that's like reasonably big. And that's because it turns out We have a lot of water and, you know, you can use water to create hydro energy. Yeah. Same thing up here in BC. It's like always 90 plus percent hydro, but totally depends on like where you're at about the mix, you know, like Florida versus the Midwest versus Texas versus where Pan's at Michigan. Totally different. Just depends. And it is, it's worth pointing out that every type of generation does have its downsides. There is no, what was it called, like a cure-all. That there is no one type of generation that is perfect. You definitely destroy a lot of natural habitats when you build hydro dams. Every type of generation is like this. It's all a pros and cons game. Then once you've made it, though, it's got to go somewhere, right? And how you take it somewhere. My understanding is across big distances with a lot of power is transmission, right? I'm looking at the blog post of this. I think it's the Simpsons. They have some power lines just moving electricity Yeah, the transmission lines are the big towers that you see on the highway while you're driving down it Also the things that we have a really hard time building, but our life would be way easier if we could right? Do you guys know why there are so many lines? I always wondered this as a kid Yeah, because you look at a transmission tower and you'll see six or nine or 12 lines strung up all in a row and I always wondered as a kid why this why this was like oh why don't they just do like one big line you guys know? I would guess something about yeah like redundancy and then something about the limitation of what it's made out of and like how much you can actually move in a good way based off the technology they used it's yeah in in a ways yes um so they're in sets of three because of three phase power uh first of all when you divide a circle 360 degrees into three um each of these lines carries power that is 120 degrees out of phase with the other so they're the lines are run in sets of three and they're often run in triangles and the reason for that is that the like Electromagnetic emissions from those lines cancel each other out in an equidistant configuration Which is super cool. You get you get less losses you get like less environmental EMR all of this kind of stuff and So now the reason that you wouldn't okay. Why don't you just have like three giant lines as opposed to like six or nine? lines And the reason is the skin effect is electrons like to travel on the edge of a conductor they don't like to travel through the middle and So one big conductor not only is it huge. It's heavy It's like, you know a single point of failure, but you're not using all that mass in the middle That the power is only traveling Along the outside along that along the skin of the conductor So now, you know Just dusting off my engineering degree for this. OK, let's talk about voltage a little bit, a little bit. Because we want to talk about voltage levels, transmission distribution, and local, right? So you generate power at some voltage, a voltage that is native to the generator. And this is different for every different kind of generator. Then to transmit it, to put it on those big transmission lines, you want to get it a very long distance. You want to lose as little of it as possible because every watt that gets to your customer is more money in your pocket. Energy that gets lost is just wasted money. And because of the way power works, power is voltage times current. If you can increase the voltage way, way up, the current goes way down. And that's important because your line losses are dependent on resistance and resistance is a factor of current. So if you can get the voltage way up you have less resistance and you have less line losses. So transmission lines are very high voltage. You know I'm not actually gonna quote a figure because I guarantee I will get it wrong but you you'll see like 12.4 you know kilovolt lines you'll see higher. Then you get distribution. So now you're at, you know, you're serving a like a whole municipality or you're serving a section of a municipality and you don't have to
go such long distances. Yes, you could you could keep the voltage high because that would that would reduce your line losses but it's now a trade-off because the equipment that has to handle this power has to be handle extremely high voltages so there's a trade-off here and when you get to distribution level you drop the voltage to I should really know these these numbers but you drop it to call it a few thousand volts and then it moves through the distribution system goes to kind of your your neighborhood like interconnection box it gets distributed to your neighborhood and You'll see that like the little green boxes that you see on, you know, like on a corner of the street or in somebody's front yard That's the last Transformation step. That's when you're stepping it down to 120 volts for sorry You're stepping it down to two phases of 120 volts in in North America So your house is actually getting 240 volts and then you use it you use it at 120 volts in your house Don't even need a textbook. It's so simple. There are three steps of the electric grid you generate power You transmit it across long distances and then you distribute it to your home There you go. We were chopping ten minutes down to ten seconds. Thank you, Pam I'll even get voltage in there for you The transmission lines have higher voltage because you got to get a lot of stuff to these locations so much faster Amazing has higher voltages on the distribution lines go much there's less stuff and it goes slower and high voltage like kills people and we don't want to kill people so we use a lower voltage we don't want to kill people i agree that's pretty solid decision making right there okay so there you go that's three steps to the electric in 20 seconds we're gonna we're gonna publish that on as its own sound bite can i generate power In New England and sell it in California No, but that's well into my we're not there yet Aren't we into it was we are there we are in the u.s. Grid. Okay, since we're on the u.s. Grid It's time for our new grip our new game. What's that acronym in which I tortured that James and Ben with energy acronyms Okay This is all their fault they brought it on themselves because they took they made fun of me for not knowing what an acronym meant A non-energy acronym, and this is my revenge. So to kick off this section, I will play, what's that acronym? And I will, of course, be more US-centric with this, because I am a US student that studies the United States grid, but I will try to be fair to Ben, and I got Canada in there. He's going to have a fighting chance. Okay. There's five questions and then a bonus. You'll never get the bonus. For full transparency, neither of them have seen these acronyms. I made them up last night. Okay. They're fake. No, no. The questions. They haven't seen the acronyms. I'm going to give them. One, what does ISO, RTO, and BA stand for? And what are the differences between them? Do each of us take it? Whoever goes first. It's like whoever gets to it first. BA is balancing authority. Balancing Authority, and then Regional Transmission Office. Operator? Yes, Organization. Oh, so do I get two? Yeah. No, well you guys see what the difference is between them. So firstly, all three. So ISO is Independent System Operator. RTO is Regional Transmission Organization. Yes, it's very annoying, but the O's stand for different things. And then BA is Balancing Authority. And so what are the differences between the three of them? Ben looks like he's having a meltdown No one basically knows the difference between the first two. There's a 20 minute podcast explanation, which I feel like you can give us. There isn't really a difference. Don't even bother There's no difference between any. No, there's no real difference. Is that it? That's the trick question. Is there What about the BA's? What do the BA's have to do? Okay, so if I'm I'm probably getting this wrong, but a Balancing Authority, I think, is responsible for balancing generation and against demand, but lacks the free market coordination powers that ISO and RTO have for actually selling into a pool. No, all balancing authority, sorry, all ISOs and RTOs are balancing authorities, but not all balancing authorities or ISOs and RTOs. Balancing authorities operate the regional electric grid for an area and ISOs and RTOs, which I'll talk about later, do so in a very specific special way with the whole cell market, with the restructured whole cell markets. And I support Ari Pesco's Twitter initiative to combine ISO and RTO acronyms as one brand new acronym called Rosoto to make FERC filings much easier for us all. And more delicious. Yes. Two, what are the acronyms of the nine North Americans? So inclusive of Canada, ISOs and RTOs. And I will be impressed if you can say what they stand for. I know what ASO is. That's, that one's easy. Upper Electric System Operator. There's MISO New York, ISO. Miso is mid-continent. Miso? Yeah, not miso soup. Is it mid-continent? It's more fun to say miso. No, it's not. You'll get kicked out of your conferences. Miso and New England, ISO. NISO. PJM. I was going to say PJM. I get it. There's New England, New York, NISO, PJM, which is Pennsylvania, Jersey, Maryland, and a bunch of other states. I remember that much. It stands for nothing. There's Arquette, Arquette, which is Texas. I don't know what it stands for. Electric Reliability Council of Texas. SPP, Southwest Power Pool. Yes. Yes. OK, great. Yeah. Is that all? No, CAISO, California. You're missing one, and I will tell you that it is Ontario. Oh, Ontario's is like weirdly vague. Like, you don't know that it's Ontario, right? Yeah. I had to Google where it technically was. Canada. No, I meant where that's specific. I knew the operator, I just didn't know where it was located. Is it IESO? Yes. And the O is not Ontario. No, it's independent electric system operator. So I will say them very quickly for everyone since we were kind of messy with it. With the correct pronunciations, and no me-so in this podcast, Kaiso or CAL ISO is the California Independent System Operator, you will hear both. ERCOT is the Electric Reliability Council of Texas. SPP is Southwest Power Pool. MISO is the Mid-Continent ISO or Mid-Continent Independent System Operator. PJM stands for nothing, but if it helps you remember it, it's Pennsylvania, Jersey, Maryland, and nine other states. NISO is the New York Independent System Operator. ISO New England is the New England ISO. I don't I ESO is it I see I used I don't know how they actually would say it. We're in Canada now I'm lost. Uh, is the independent electric system operator in Ontario and what'd you say? It was a so a yes So a so a so is Alberta electric system operator. Okay bonus points Why are there only two in Canada because it's like America and you had to willingly enter into them Yeah, there are only two power markets Alberta and Ontario Every other province is just crown controlled. Stop taking over my game. Okay. Three. What is an LSE? Load serving an entity. Eh, the utilities that sell you power. Boo. Okay. What is FERC and NERC? And I get away with this one because one of these entities has jurisdiction over Canada and how are FERC and NERC connected, at least in the American context. I feel like you both know except for the last part, right? I don't know this. Federal Energy, was it F-E-R-C? Federal Energy Regulatory Council? Commission. Nuclear Energy Regulatory Commission? OK, we got it all wrong. Absolutely not. Absolutely not. Is it North American or national? North American. Okay, Energy Regulatory Commission. No? Wow, that would be too easy, wouldn't it? Yes. Oh my god, there's a dog. Sorry. My entire family on the podcast right now. So FERC is the Federal Energy Regulatory Commission. They are an independent United States agency tasked with ensuring just and reasonable rates on the transmission system, among other things, so they are just in America. And NERC is the North American Electric Reliability Corporation, and they're an international regulatory authority that ensures the reliability and security of the bulk power system by developing
and enforcing standards. And if you do anything with the transmission system or with wholesale markets in any way, you will definitely come across FERC. You will hear about them all the time, worth going to their public meetings. you might hear about NERC, especially if you're working in the academic context. You will, and you're doing transmission system and reliability, you will be reading many, many NERC things. And the way that they're connected is that NERC's jurisdiction in America comes from FERC. They had to choose some entity to have that regulatory, not that the regulatory, oh yeah, that regulatory authority over full power system standards and they chose NERC. Okay, last one that you guys have a fighting chance on and then the bonus which I know you won't and it's just what is a PUC or a PSC in the U.S. context? I don't know what the Canadian equivalent would be. Maybe there is no thank you. Public utility commission? Public service commission? Yep. And those are U.S. state regulatory entities for utilities. That's just the general name for them. Every state kind of has their own little way of doing it. Sometimes it's PUC, sometimes it's PSC. I think for example, New Jersey's is like the New Jersey Public Service Commission or Public Service Commission of New Jersey. Everyone's got their own little thing, but like when talking about them, generally we say PUC or PSC. Okay, here's your bonus for fun because I recently spent an egregious amount of time figuring out Kaiso's API for this and the documentation was the stuff of nightmares. What does Oasis stand for? Oh god. They make classic songs. Oasis is classic now, I guess, right? What did you say? Oasis is, that's like classic rock now. Yeah. So can we start with what Oasis does? My understanding of what Oasis does is it's a piece of software used by California ISO. They do other ones, but the most I've heard people mostly talk about it with California. And it's a software interface you use to get data about the wholesale market and the ISO. Very close. That was pretty good. That was pretty good. Pretty good. Yeah. It actually has a regulatory. I have nothing to add. I don't know. So OASIS stands for Open Access Same Time Information System. And it's the platform that the ISOs and RTOs use for bids and offers and info about the system. And this is per fork order 889. The existence and usage of this is actually federally required. All of the ISO RTOs use it? So order 888 in the late 90s, was it like 96 with order 888 that said ISOs exist And then eight eight nine came right after and it says you all have to use this You all have to use and have this this platform for managing your markets and It needs to be publicly posted and it looks like we use it in Canada as well. There you go Good to know that's a deep cut Thanks for playing Thank you for playing my game that was fantastic, let's absolutely do that again I have to hop off, but you guys take everyone else through the nitty-gritty. So thank you for playing my game. I really enjoyed my revenge. But now to move on to the US electric grid with all that context and all those new acronyms that you've all learned. I find it helpful to consider the different layers of the electric grid from a geographical standpoint. And it's a way to look at a map and say, where am I physically located in the system and whose territory I'm in? So, at the biggest level, you have interconnections, and the US grid has three separate grids or interconnections with minimal transfers of power between them. And these three separate interconnections are the Eastern interconnection, the Western interconnection, and ERCOT, the Electric Reliability Council of Texas. So they are both... Yeah, questions on this. So if I, you know, back to the question, right, like if I generate electricity in Massachusetts, which is on the Eastern Inconnexion, can I definitely not use it in the Western Inconnexion or AirCut? Like the electrons never flow between the two, or like what's the division there? Very rarely. You would need high voltage transmission lines to do that, and we currently don't have that capability. Gotcha. And that's the way that these interconnections result in physical limitations to the system, because they are essentially operating as their own separate grids with very few connections between them, then you can't get power between them. I think regardless, it would be very hard to get power from California to New York. But that is one big hurdle against that. But yeah, so we have the Eastern interconnection, the Western interconnection, and then ERCOT, the Electric Reliability Council of Texas, which is both an interconnection and an ISO, or an independent system operator that we talked about before. Because no man is an island, but Texas sure as hell is. These borders of the interconnections are often referred to as the seams of the grid. So if you ever heard of the seam study coming out of NREL, that's what that's from. And like I said before, those interconnections result in physical limitations to the system. So within the interconnections, you have BAs or balancing authorities. And these are the regional grid operators that do the day-to-day operations of the system. They keep dispatch generators, predict demand, and keep the grid happy and content at 60 Hz, meaning that supply and demand is always equal. The US has 66 balancing authorities, and they're typically either the ISOs and RTOs that we mentioned before or specific utilities. ISOs and RTOs are special balancing authorities because they have extra responsibilities, they're regulated a bit differently, and they use different mechanisms to balance the system. relative to when the balancing authority is just the utility for the area. I'm just going to call them ISOs for the rest of this. ISOs and RTOs are functionally the same thing. ISOs are non-profit, independent organizations who manage the transmission system. They dispatch generators using a competitive market, run models and forecasts to make sure that there is always enough power on the system to meet demand, and have certain transmission planning requirements from the federal They also operate Oasis, which we spoke about before, which gives you lots of historical information about the system like prices and load and demand. If you can figure out the API. If you do, please let me know. ISOs one day will get their own episode with their history and drama, but it's just important to know that they exist, operate the grid, manage an open competitive wholesale market that uses economic dispatch. Just to make sure that people connect the dots here, before we named, but just to make sure that people are following right. We had these interconnects, which is like the three-piece slices, kind of broadly East-West and then ERCOT in Texas, but not all of Texas, weirdly. And then these ISOs, we're going to call them, right? That's like the Cal ISO, or the MISO, or PJM, just so people are tracking. Yep. And that's why a lot of them have ISO at the end of them. Except for, I love it when, for example, ISO New England has ISO in it, but it is an RTO. Yes. Yep, it's the same thing. That fooled me, exactly. Yeah. Within the balancing authorities, you have many utilities, our good old utilities who you are all familiar with because they send you a bill once a month, unless you're DTE. Examples include DTE, Detroit Edison, Con Edison in New York City, and San Diego Gas and Electric in California. San Diego Gas and Electric, I spent a whopping 2.5 hours on the phone with yesterday. So thank you to the very patient customer service people who put up with me as I tried to figure out when your demand response programs were dispatched in 2020. Real quickly, you called up San Diego Gas and Electric demand response line and waited or talk to them for two and a half hours to figure out when their demand response events were dispatched?
Well, no. I used the chat first, then the chat gave me the number two, the demand response line, and then the demand response people sent me back to the general customer account. Then the customer account people just sent me back to the demand response, so then I went back to the chat. You're being transferred all the time? Yeah. And then the chat people gave up and they sent me back to the demand response. Then I did some Googling based off of some of the information that the demand response people gave me. After I finished doing some Googling, I called the demand response people back, got the same guy that I had heard from the time before that. He was very unhappy to hear from me again, and then we figured it out, and we found a way for me to get the times when the program was dispatched without them explicitly telling me. And so all you're trying to do is figure out when the programs were dispatched in 2022. And that took me two and a half hours. 2020. Oh no, it ended up being 2022. Yeah, it was 2022 actually, yeah. And everything you just described just to get the answer to that question. It was just one program, too. It was just their program that's called Power Saver Rewards, which is technically peak time rebates. Alright, everyone, be encouraged by the fact that everyone is out there doing things similar to what Pam just said to get answers to simple questions. Well, I think to be fair to them, they really weren't allowed to tell me. So they could give me hints. Yeah, I think they could only really give me hints. They could say, well, you know, it was dispatched 11 times and- Why can't they tell you? Some utilities can tell you. I did this for all the utilities in California. Some utilities can tell you, some can't. They can tell you for some programs. They can't tell you for others. Sometimes they just don't know you need to find the right person. That's fair. Yeah. So thank you San Diego Gas and Electric for your for your help. One last thing on San Diego Gas and Electric. For some reason they they made the effort to make the demand response line a different hold music than the normal line and it was just really bad. They should just keep everyone. It's bad regardless. Yeah like they should just keep the whole music the same. It was like someone went through effort, extra effort to make that whole music worse. Utilities. You might also hear utilities referred to as LSEs or load-serving entities because they are serving load. Wow, the lawyers are so creative with their terms. Utilities, generally speaking, operate the distribution system, so the poles and wires of the grid, and they sell power to consumers and deliver it to your house. They also run energy efficiency and demand response programs, have fun asking for the dates those are dispatched on the phone, as well as offer multiple rate designs, which we touch on a bit I know for sure in our EV episodes. Depending on the state that the utility is in, they may own and operate transmission lines, and in most cases, they do generate power regardless of whether or not they are in ISO or not. Markets, which I have alluded to. No, real quickly, before we get into markets, this was in another version of the blog post, um, inside an individual electric utility, there's like sub zones or like buckets within the utility, right? Like, um, I think you called them. So sub laps. Yeah. Let's talk about sub laps a bit so people can really understand. Sublaps stands for sub load aggregation point. I know for a fact, Kiso has them. I don't know if other ISOs do, for example, other ISOs might have zones, for example, that they use. And basically, you don't just offer your generation or buy electricity from the entire market. There are dots all throughout the map or zones throughout the map and you offer into those specific, the dots are called nodes. If you look on ERCOT or KAISO's website, for example, they have very clear visuals of this. you offer into a specific node or zone. The sublaps in QISO are just a collection of those nodes. Yeah, my understanding is that they're not going to have... Huh? Yeah, go ahead. No. And I think the idea behind that is that for some services you offer into a sublap or you're generating, if you're, for example, offering in an aggregation of distributed energy resources, which are smaller and located on the distribution system, they can be anywhere in that sublap. Yeah, my understanding is not just at the ISO level, but even within the utility, they'll have, let's say, Con Ed has a certain, this is the Con Ed territory. Inside the Con Ed territory, there's little portions that are broken down even further. And I think it depends, what they call those, depending on the utility. So apologies to the audience for not knowing. But if you're trying to start from the entire grid to the three interconnects to different ISO regions, the different utility territories. I think there's one step below that even, which is like the portion of the utility territory. Maybe those are just nodes or I'm not quite sure what they're called. I don't know what they call them. I know in the different California utilities, which I don't normally work specifically with utilities, but I do know the California ones the best, they split areas up based on their baseline allocation, which is the maximum amount of electricity that a home could use before they get bumped up a tier on the price. And so their baseline allocation is based off of where they live and how much air conditioning they're expected to use and whatnot. I see. This gets really specific. If people are interested in learning more about like these very, very nuanced, any gritty details, please let us know. We never know where to do deep dives, but I just wanted to like highlight, you know, the levels continue. Yeah, it's bureaucracy. There's always another level that you can go down in specificity. Now that we've done the geography of the system, we've talked about markets many, many times and not said what we meant by that. So there are two types of markets, wholesale and retail. I'm gonna start with wholesale and then we'll talk about retail. So everyone take a deep breath now before we do wholesale markets in the US because you need a deep breath before you talk about them. Wholesale markets refer to transactions that occur on the transmission system. I think that the easiest way to understand wholesale markets is to understand it as this how we got from one to the other. Yeah, that's fair. Yeah. So I like, when I look at them, I break them down by like, regulated, like is more simple. And then you kind of like unpack a bit more. Yeah, of course, because one's an easy monopoly and all three steps are owned by owned and operated by the same entity. And then the other one's like, Whoa, we created an entire policy market to do this thing that we want. And we keep making this policy market more and more complicated, so that it takes into account more and more things. So wholesale markets refer to transactions that occur on the transmission system. And this essentially means utilities selling power to one another. This is not an all encompassing definition, but if you're new to it, just go with this definition because your life will be significantly easier. And at this point, here lies interstate commerce, meaning that there are many, many lawyers involved. If you are in an area that is not restructured, meaning that the utility is a monopoly and owns and operates the generation, transmission, and distribution steps, then you just submit your wholesale sale to FERC or the Federal Energy Regulatory Commission, and then they approve it if the rate is just and reasonable. So I guess what I'm confused about, and maybe other people understood it, when I look at the markets, I do like regulated markets and deregulated markets. And the way I understand it is, regulated is mostly what you just described, which is the utility. Let's use an example, Con Ed in New York. They handle everything. So they handle the, I guess, generation, transmission, and distribution. Not in New York, but I'm trying to think of a lot. Yeah, it's a bad example. Let's say, in Georgia. Who runs New Mexico? Well, there's three in New Mexico. You've got PNM, then you've got El Paso Electric, which has the coolest logo of any utility. And then Excel does some work there, too. So I can give you a pick in Albuquerque or Santa Fe. PNM is doing generation and also doing transmission and distribution. Yeah, if it's regulated. If you're in a regulated or a non-restructured wholesale market, then every step of the process is owned and operated by the utility. So they choose what generators they build, they build their own transmission lines, and then they choose the order in which those generators get dispatched to meet demand. And then the wholesale sales come between those utilities buying and selling power to one another. I see. But like in, in PNM, aren't they all just, they're just buying and selling to themselves basically? Well, they might take from a, there might be another utility next door. I see. so they can buy from next door. Yeah, or we could get into power pools, but utilities might be in like a power pool and they all might buy and sell from each other. Okay, that's a little tricky. The way I was thinking about it was like, if you're an electricity customer, you have this bill, like you talked about the bill, and then there's the supply portion, which is like the cost of generated electricity, and then delivery, which is the cost to deliver it through transmission distribution. And then in the regulated market, once again, the utility, like P&M, they're going to bill you for both of those things, supply and delivery. Yeah, you're going to get bills all from the utility regardless, but... Only get a bill from the utility. Yeah, regardless, you're only getting a bill. But how they get the electricity, right, like generate and move it to you, they may or may not be generating it themselves or buying it from other utilities is your point. Sorry, in a regulated market? Regulated market, yeah. Regardless of whether or not you're in regulated slash un-restructured or deregulated slash restructured markets, the power could technically come from a different utility or from a different entity. It's just how that's being regulated, like the wholesale market. So in a regulated market, if utilities buy and sell power between one another, that sale has to go through the Federal Energy Regulatory Commission. The individual sale goes to them and then they approve it as just a reasonable and then it gets to happen. But all three steps of the process are still owned by this one utility. I see. There are many less players involved and the utility gets to decide the order in which they dispatch generators or whether or not they're even going to sell or buy power in the first place from someone else. They might say, oh, we're going to buy from this other utility, or they might say instead, we're gonna build a new generator. And they can do that basically, they can do whatever they want because they run the whole show, or is there any process? Yeah, of course the Public Utility Commission slash Public Service Commissions that we spoke about earlier have regulatory authority over them in some way. And FERC can say whether or not the sale is just and reasonable if one occurs.
Yeah, it's a bad example. Like let's say in Georgia, well, there's three in New Mexico, right? You got PNM, then you've got El Paso Electric, which has the coolest logo of any utility and then Excel does some work there too. So like if you pick in like Albuquerque or Santa Fe, PNM is doing generation and also doing transmission and distribution. Yeah. If it's a regulated, if you're in a regulated or a non-restructured wholesale market, then every step of the process is owned and operated by the utility. So they choose what generators they build, they build their own transmission lines, and then they choose the order in which those generators get dispatched to meet demand. And then the wholesale sales come between those utilities buying and selling power to one another. I see, but like in PNM, aren't they all just, they're just buying and selling to themselves basically? Well they might take from there might be another utility next door. I see so they can buy from next door. Yeah or we could get into power pools but utilities might be in like a power pool and they all might buy and sell from each other. Okay that's a little tricky. Yeah. The way I was thinking about it was like if you're an electricity customer you have this bill like you talked about the bill and then there's the supply portion, which is like the cost of generated electricity, and then delivery, which is the cost to deliver it through transmission and distribution. And then in the regulated market, once again, the utility, like P&M, they're going to bill you for both of those things, supply and delivery. Yeah, you're going to get billed all from the utility regardless, but... Only get a bill from the utility. But how they get the electricity, right, like generate and move it to you, they may or may not be generating it themselves or buying it from other utilities, is your point. Sorry, in a regulated market? Regulated market, yeah. Regardless of whether or not you're in regulated slash unrestructured or deregulated slash restructured markets, the power could technically come from a different utility or from a different entity. It's just how that's being regulated, like the wholesale market. So in a regulated market, if utilities buy and sell power between one another, that sale has to go through the Federal Energy Regulatory, like a commission. The individual sale goes to them and then they approve it as just a reasonable and then it gets to happen. But all three steps of the process are still owned by this one utility. I see. There are many less players involved and the utility gets to decide the order in which they dispatch generators Or whether or not they're even going to sell or buy power in the first place from someone else They might say oh, we're going to buy from this other utility or they might say instead we're gonna build a new generator and They they can do that basically As they can do whatever they want because they run the whole show or is there any process? Yeah, of course the Public Utility Commission slash Public Service Commissions that we spoke about earlier have regulatory authority over them in some way and can say whether or not the sale is just and reasonable if one occurs but yeah that's their choice that's their choice as the monopoly and as the system operator okay does that make sense wholesale markets are hard that's why we took a deep breath yeah and that's why like for me when i think about regulated markets i almost like forget about the wholesale market and i just think about like the utility is mostly doing everything and they bill you like you only have an option to get billed by them i almost think about it from like the customer standpoint, but I guess like, like all things, there's levels here. Well, yeah, well, so. We're like explaining what's technically correct. Well, yeah, because there's, there's, we're only talking about wholesale right now. Just because your wholesale market was deregulated or restructured doesn't mean that your retail market is. And just because your retail, well, I think they are not mutual, sorry, they are not, what's it, they're not mutually exclusive, like the deregulation of both. Yeah, understood. Yeah, the wholesale market is because there's interstate commerce and there are all the lawyers involved. That is the federal sphere of things There is a bright line between them. It's a lot. There's a bright line between them The retail is the state level. They are two separate things. Just imagine them as being separate things Yeah, and I think I understand that Largely because you helped me understand that the thing like that I think that all this stuff is confusing and so the like mental model I use to try and understand the different markets is there's two kinds of markets.
Again, high level, regulated, deregulated. And then in regulated markets, the utility is the only person you're getting billed by. And they are managing pretty much, again, let's keep it simple, generation, transmission, distribution to you. If that's not correct, then I think it's hard for people to understand all the differences. So you're only getting, so you're only getting billed by one person regardless. It's whether or not that the person that's billing or the entity that's billing you is buying from somewhere else. Are they getting billed by someone else? And so in a, and we kind of skipped the levels. I didn't even get to what restructured deregulated markets are. They're getting billed by someone else. And then that bill gets passed on to you, but you're still only receiving one bill. Yeah, as a customer, and I guess like when I try to understand regulated markets myself, I mostly just think about like the utility kind of managing things, and then the customer gets the one bill, and then to further unpack it, I then go like, okay, if it's a deregulated market, then there's what you said, which is you can have wholesale market deregulation, and or you can have retail market deregulation. Yeah, you don't have to have both depending on the different markets. Yeah, I think that's that's fair That's a good way to think about it. Yeah What we just spoke about mainly before was the regulated markets, which is also called a non restructured market if you are in a deregulated area in the transmission system or what I call it would call a Restructured area you're working with the ISOs the independent system operators and the RTO the regional transmission organizations that we were talking about before. So the Energy Policy Act of 1992 kicked off this general process of deregulation of the wholesale power markets. And it's really actually very fairly similar in concept to the when they deregulated the airline industry. But in practice, it turned out a bit different. So at the wholesale level in the electricity system, this deregulation meant creating a to break up that regulated monopoly, that monopoly of the utility owning generation transmission and distribution and operating all three. So the Energy Policy Act of 1992 was when Congress said, FERC, go deregulate the industry the same way that we're deregulating the airlines. And FERC said, okay, Congress, thank you. We will do this through encouraging states and utilities to restructure the wholesale market through the creation of these ISOs and RTOs. So no longer do the monopoly utilities get to decide which generators get dispatched when now this independent non-profit ISO will operate an open access market that anyone can participate in. So it's not just DTE anymore that gets to sell power to the market. Anyone gets to do it and these merchant generators that are not monopoly utilities can out offer the utilities and get dispatched first. Their wind turbine can get chosen to generate power before DTE's coal plant. I see. And so in one of these, and so real quickly, just to make sure I understood it right, 1992 is when this all started. Yes. Okay. And then in what are we calling it? There were more memories of it from beforehand. This idea didn't just come out of nowhere. I think people were really excited about breaking up with the monopolies. There's a really great book by a very well known book by Richard Hirsch called Power Loss that goes into extreme depth about this. And I haven't finished that book yet, but one day I will. But that goes through a whole history of how this happened. And it was like a long time coming. So the utilities or electricity retailers or load serving entities then will buy power from the market to sell to the consumers. So DTE, let's will offer into the market. The market will then dispatch the generators. DTE will get paid by the market for what they generate. And then they'll buy the electricity back from the market that they're going to sell to their customers. And that's where the billing gets weird because all those costs from the market get passed on through whatever they charge you. So they might be paying for the wind turbine, the merchant generator wind turbine. Yeah. And so then in, again, like a place with deregulated wholesale markets, like the utility, like DTE, can sell power into that market as a generator, but also third parties like a solar developer or some other generator can also sell power into that market and get paid for it. Exactly. Yeah. And then on the other side of that, like, there's some like pool, right, and so you're dumping a bunch of electricity into the pool, and then DTE will be buying some amount of that as a retailer or load serving entity. And so they buy some power from the pool, and then they sell it to their customers. Yeah. And so the difference from the regulated wholesale market is that before DTE could have just said, well, we have this much demand, we're going to meet it with natural gas generator one, natural gas generator two, and coal plant three. But now that they're offering into this market, the market might say, well, we'll take natural gas generator one, we'll take however many megawatts from natural gas generator, or however many gigawatts from natural gas generator two, but we will take coal generator, coal plant one. We have someone else that's going to do that for us. We don't need your coal plant. It's too expensive. Yeah, that makes sense to me. Yep. So notice how I switched my terminology from deregulated to restructured halfway through that. These terms are often used interchangeably, which is why I thought it was important that I use both of them, even though they are not necessarily interchangeable. um but everyone does it anyway so it doesn't matter. I'm a stickler though for using restructured specifically after the Texas freeze in February of 2021 because deregulated makes it sound like there is no regulation happening whatsoever. When uh the whole ERCOT thing happened everyone threw their hands up and they said they are deregulated markets nothing's being regulated nothing has happened and ERCOT isn't as much regulated as other areas but please do not It's sad. That is not the case. You like restructured instead of deregulated because there are some rules in regulation, right? It's not totally deregulated. It's almost like capitalism, right? In the US, like, of course, we're not pure capitalism, but we're not communist, of course, but we're not pure capitalist either because there is some government influence, you know, so like, yes, like you could say like, you know, the US is capitalistic, but it's not like purely capitalistic. and so in the same way we're not like purely deregulating these wholesale markets. I see what you mean. I do also think though like when people learn about this stuff, the terms they normally hear like and they're just trying to keep the stuff straight because as a new person it's pretty confusing. They hear deregulated, they're like great I'm latching on a deregulated. There's deregulated and regulated and I know the difference and I'm really happy with that. I'm gonna like check the box and move on for now. Yeah it's tough because I think in industry you hear deregulated and regulated a lot. And I did a lot of my initial energy education in law classes. And so I learned restructured and non-restructured. So it depends on where you're coming from. All right, Pam, the question I have to ask, do we wanna cover these kind of three main buckets of market types in wholesale deregulated markets, energy markets, capacity markets, and ancillary service markets? Yes, we do try and explain these to us simply I will and I have such a fun metaphor for you Isos and RTOs run three types of markets not all of them run all not all of them run all of these For example or caught SPP and Kaizo don't have capacity markets but they all show up and you will hear about them all so energy markets is what everyone has and These are the day ahead hourly and real-time sales for electricity This is the bulk of where the buying and selling of your electricity is occurring and where it's coming from ancillary services are markets for services that help balance the transmission system like frequency regulation and reserves that's the little stuff that's happening on much smaller much smaller time scales reserve is just in case you need it extra stuff that you have on hand like it's like they're on hand in case you need it as like all right I I can call it as needed, but maybe hopefully I don't need it. OK. Maybe the demand is a bit higher than you initially predicted it would be. So you just have a little bit on hand in case. Yeah. And then there's 26 million toasters we lost. We need something. Yeah, yeah. We got to find 30 megawatts of, I'm sorry, 30 gigawatts of reserve somewhere. Good luck with that. Ancillary services are small timescales, small amounts. It's a little stuff. that just keeps the system going on the minute-by-minute basis. Small calibrations to keep things on the rails. Little teeny things, yeah. Frequency regulation is just the easiest way to think about ancillary surfaces. Then finally is capacity markets, which I know everyone has their own opinions on. Capacity markets could have their own episodes because they care so much about them and they have so many opinions about them. Here is an entire book I am holding up. She has electricity capacity markets. Yes. Todd S. Agard and Andrew N. Clite. Yes, this is all about capacity markets. They don't have books like that for ancillary services, guys. Capacity markets provide payments to generators for their generating capacity that they provide to the system. You're not paying them for actual electricity generated. That's what the energy market does. You're paying them for the generation capabilities that they will offer the system in the future. You want to have a reserve margin, the capacity market helps you have that reserve margin. Capacity markets are just at their core paying generators to be available and exist. A metaphor for these three markets and what I think is the easiest way to think about them is that ISOs are essentially a bar. Capacity markets are the cover fee that you pay to get in the door and ensure that the band will be playing that the bartender will be there to make your drinks so that you can pay for them later on. The energy market is the actual drinks that you buy and the ancillary services are the bar peanuts and the popcorn and the fries that you eat on the side to keep you from getting alcohol poisoning when you've bought so many drinks from the energy market. And of course this metaphor eventually breaks down. I have no idea what the equivalent of the net cone or the net cost of new entry or the Mopr minimum offer price rule or reliability must run contracts would be in relation to the cover fee here, but the vibes are there. This is, the ISO is just a bar. I mean, sometimes you don't need to know everything about how the sausage is made right at the bar. What do you mean? You don't want to read elections anymore. Okay, let me test this a little bit then. So I'm gonna go out with my wife on a Friday night and we're gonna go to a bar that has live music in downtown Seattle. To pay 20 bucks to go see the concert, let's pick one. I saw M83 recently. Or maybe Dead and Company, with John Mayer, they're touring. They just came to the Gorge Amphitheater. So my price to get into the bar or the concert venue, let's say 50 bucks or something, that's the capacity market payment for me. As long as the main reason you're there is the drinks. Yeah, yeah. The main reason I'm there though is the drinks. I don't actually like this band that much. I'm just going because, you know, I'm trying to be a good husband. And so I'm going there for the drinks, right? It's all about the drinks. And so all the money I spent on the drinks at the concert is the energy markets. And then if I want to, this breaks down a bit because I was going to say like money for the jukebox or the salty peanuts or the snacks or the other stuff kind of around the edges, kind of small things, that's the ancillary services markets. Yes. That's a great way. That's a great example. Okay. All right. Go ahead. What I made this example, just I guess for people to know, if anyone went to Penn State, I was specifically thinking about the bar champs. Deregulated retail markets. Ah, retail markets. I'm going to admit, I don't know as much about deregulated or restructured retail markets as I do wholesale markets because I spend all my time doing wholesale markets. But these, the decision whether or not to deregulate trust slash restructure your retail markets is a state decision at the state level, because states have jurisdiction over retail markets like we spoke about before, and the federal government has the jurisdiction over wholesale markets. Retail markets are when monopoly utilities and non monopoly utilities sell or retailers sell power to you, the consumer, and the restructuring process opened at the retail level opened up the market to non monopoly utility providers. So you'll offer here to this referred to as consumer choice, because you get to go out and you can choose who you want to buy your power from. And those entities are buying their power that they will sell to you from the wholesale from the wholesale market. Most likely the restructured wholesale market. I don't think I can think of a place that has a non-restructured wholesale market and a restructured retail market. Actually, there might be. Maybe the closest one that's at the top of my mind, California, because California has a deregulated wholesale market. And then you do kind of have a choice with community choice aggregators. But like, you don't have like a choice of anyone in the entire state, I think in a lot of cases. It's like, if you live in San Francisco, you have like Clean Power SF, or you know, like someone like that who's like you're designated, like you could buy from them in addition to buying from Pacific Gas and Electric. That's like really weird example though. So like maybe did more damage than I just helped. Ah, there is one example, sorry. There is one example of a state that has a restructured retail market, but a non-restructured wholesale market. And if I'm reading my mouth correct, I think it's Oregon. Oh, no, no. I was just about to say, hey, shout out to Oregon, right? Yeah, Oregon. We've got Seattle from Portland, so I can speak a little bit about this. Yeah, I don't know the specifics of how that works with the wholesale market, but that is the one place that does not have a wholesale market. I think it's a decent example, though. So we love Oregon, Portlandia. So you kind of don't have a choice if you own a house. If you're in a house, you're below a certain threshold. I think it's like 50 kilowatts, I think. And so if you're below 50 kilowatts in Oregon, you have no choice. And you have to buy from the utility, like Portland General Electric, or Pacific Power, or Idaho Power or Eugene Co-op or whatever. But if you're above that like 50 kilowatt threshold, which is kind of like bigger businesses, it is a deregulated retail market with a lot of asterisks there. And so you can choose where to buy your electricity from. So another one, which I think is like, you know, it depends. Like some states are just fully open, like Texas, you can just buy your electricity supply from any retailer and then the delivery um is from the utility or like in New York, I know this one well, like in New York you buy electricity delivery from Con Ed always, but you can buy from a third-party supplier, although um by default you're normally still buying supply from the utility, like you're putting both things on the bill, but you have the choice to leave. Yeah and that's a great point to from someone else. And that's a great point to make, um is that in deregulated, or sorry, Restruct in restructured retail markets the poles and wires are still owned and operated by the monopoly utility It's just the transaction is occurring with some third party Yeah, that's fair. And then there's there's like so many details and all these are weird like maybe you could speak to Michigan I know Michigan has like a lot of strange like Details to the fact that they have retail choice. I actually really can't I really in an apartment complex where I don't have an electricity bill, so I've never purchased electricity in, I've never purchased electricity in Michigan before. So I guess like the rule here, there's regulated and deregulated markets, and then within deregulated markets, you can have wholesale power deregulation, which is where third party generators, in addition to the utility, can sell power into the grid, sell power into the wholesale market and get compensated for it. And that happens at the ISO level, like PJM, New York ISO, those levels. And then you can also have deregulated retail markets, which happens at the state level. And so in Texas or in Oregon, You have different rules at the state level for retail deregulation, which kind of overlap and have a weird mishmash with the deregulation of the wholesale markets. And so no two places are the same. We're doing our best to kind of help you sift through it. But as with all things electricity, it's pretty messy. There's a couple of helpful charts in the blog post, but a lot to unpack here. If you have to choose between spending your time studying wholesale markets or retail markets, you should choose the right, you should choose restructured wholesale markets. Damn it, you got me saying deregulated. Stop. I didn't go through three plus semesters of energy law to say deregulated. So I've won because I'm creeping into Pam's vocabulary now. Thank you everyone for joining Pam. Till next time. See you next time. Maybe last thing. If you like the show, please leave us a review that was helped greatly or share the show with anyone else, you can find us on Apple and Spotify and Substack. Until next time, thanks for listening to Indermediate.
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