Space, time and electricity (part 1)

DEEP DIVE: How should power prices be formed on a grid that is constraining renewables?

Not all energy is made equal. As a general rule, the more obstacles that lie between a unit of energy and its end-user, the less value it has. A molecule of gas is often a liability at the wellhead, but commands an eye-watering premium once in a pipeline network in Europe or Asia. Location is hard-wired into gas markets. Price differentials signal a nee…