Ok energy companies doing the bare minimum to meet their terms of their contract, totally true. A tale as old as time.
The rest of this causal narrative is wrong. So as someone who has taken a lot of Econ classes, the free market is not always competitive. To over simply a little bit. When cost of entry into an industry are low there tends to be a lot of businesses. If I charge 2$ for an apple it cost someone 10,000 dollars to start an apple farm and charge 1.50$ for an apple im probably going to have to lower my price.
When cost of entry is really high, say like building a 600 million dollar power plant, theres not gonna be a lot of room for people to move into the industry. Which means producers dont really have to worry what consumers think within reason. If I charge you 100$ for electricity and its really worth maybe 80 no one is going to build all the power lines and the factory to undercut me. This is called a natural monopoly. There other of these like Big Tech, the media, the oil companies, and the big Pharma companies and we all know what benevolent overlords they are. There is no boutique public utilities companies nor will there ever be one. Now if am a natural monopoly beside being a price-gouger, I'm going to underproduce rather than over produce, because it is more profitable to do so that is universally agreed Econ 101. Look at the diamond industry. So if 1 in every 5 years my consumers are going to have a blackout because I didn't spend the additional 100 million dollars to winterize my power plant, im not going to fucking do it, because it truly is cheaper not to. And what are they going to do not pay for electricity. No the power generation industry in every country in the world is a top down business. You and your buddies from college aren't going to skip eating out for a few years to put a down payment on hundred of millions of dollars of equipment. The question is do you want regulated or unregulated monopolies.
So the government can pay public utilities companies to build more wind power, which they probably might do anyway given how cheap wind is for them. Or the government could pay public utilities to winterize their factories, or they can do both, but the public utilities companies would never do it with their own funds in a place where the loss of power is relatively rare because the market will never make it profitable decision to do so.
Ok so Econ 101 is basically just capitalist theory. In Econ 102 or above you start getting into debates about how the economy works, you got your keynsians and your classical liberals but Hayek and Krugman would both basically agree with everything taught in Econ 101.
But never mind that.
The garbage business is a low cost to entry business. It cost very little to buy a pick up truck to carry your neighbors garbage to the dump. Nor does it cost that much money to buy some land for a dump. Very different from the amount of infrastructure power generation takes.
I can guarantee you will not be able to start an energy company from your house for two reasons. 1. The power companies built and own all the electricity wires and existing power generation facilities. It is there property, they built it. It is going to cost you a ton of money to replicate that infrastructure with a second set of power lines. Since im assuming you want a FREE MARKET. Your also going to have to pay everyone who you run your power lines through their property a lot of money or lay down a lot of extra wire to go around people who don't want them. 2. You are going to have an economy of scale problem. If you build a large power plant per watt your energy costs a lot less than if you build a lot of little power plants. This because bigger generators are more efficient. If your making power with your average 20KWH generator that you could probably afford, It would cost you about national average 20 times as much as the grid. Obviously you could improve this somewhat by buying bigger generators, but your just not going to be able to be profitable or offer anything near competitive prices until you scale up to a industry standard generator that you can't afford. Never mind the fact that you absolutely could not afford to competitively ship your fuel sources via railroad or pipeline without tens of million of dollars in investment. If you try to ship it over by truck you would add another 20% to your operating costs. So no its impossible.
Ok maybe you realize now that your going to need a big company to provide your power. But the government is just making things worse. Maybe you think the EPA studies showing that unregulated coal power plants spewing mercury and unburnt ash causing cancer is fake news and rivers should just be giant sewers and all these pesky regulations are whats freezing texans. Never mind that many more people would die of cancer than are going to freeze to death. We can go full Beijing and just have unregulated emissions and giant smog clouds. That would save a little bit of money probably if you don't factor in healthcare costs. It would not be good for rural areas though. You see we already have a much less regulated monopoly in the US in the form of Internet service providers. It costs a lot more to build power lines to middle of nowhere towns than to cities and just like ISPs do you can expect companies without government incentives to provide rural power, just not really doing so or providing it at exorbitant rates. Laying a hundred miles of wire to power 4000 homes is not a huge profit for the public utility company in comparison of laying a hundred miles that power 90,000 homes in the city. So like ISPs there just going to be pretty shitty service. Rural electrification was largely a government program. Companies would never provide power to little Montana towns if the government didn't give tens of billions of dollars in subsidies to do so. By setting price controls the government is basically subsidizing the cost of power to people in rural areas at the expense of people in cities. Which great for you if your going to be a consistent anti-government stan but your going to pay more in power and I a city dweller might pay less depending on how much the monopoly price gouges
Ok energy companies doing the bare minimum to meet their terms of their contract, totally true. A tale as old as time. The rest of this causal narrative is wrong. So as someone who has taken a lot of Econ classes, the free market is not always competitive. To over simply a little bit. When cost of entry into an industry are low there tends to be a lot of businesses. If I charge 2$ for an apple it cost someone 10,000 dollars to start an apple farm and charge 1.50$ for an apple im probably going to have to lower my price. When cost of entry is really high, say like building a 600 million dollar power plant, theres not gonna be a lot of room for people to move into the industry. Which means producers dont really have to worry what consumers think within reason. If I charge you 100$ for electricity and its really worth maybe 80 no one is going to build all the power lines and the factory to undercut me. This is called a natural monopoly. There other of these like Big Tech, the media, the oil companies, and the big Pharma companies and we all know what benevolent overlords they are. There is no boutique public utilities companies nor will there ever be one. Now if am a natural monopoly beside being a price-gouger, I'm going to underproduce rather than over produce, because it is more profitable to do so that is universally agreed Econ 101. Look at the diamond industry. So if 1 in every 5 years my consumers are going to have a blackout because I didn't spend the additional 100 million dollars to winterize my power plant, im not going to fucking do it, because it truly is cheaper not to. And what are they going to do not pay for electricity. No the power generation industry in every country in the world is a top down business. You and your buddies from college aren't going to skip eating out for a few years to put a down payment on hundred of millions of dollars of equipment. The question is do you want regulated or unregulated monopolies. So the government can pay public utilities companies to build more wind power, which they probably might do anyway given how cheap wind is for them. Or the government could pay public utilities to winterize their factories, or they can do both, but the public utilities companies would never do it with their own funds in a place where the loss of power is relatively rare because the market will never make it profitable decision to do so.
Ok so Econ 101 is basically just capitalist theory. In Econ 102 or above you start getting into debates about how the economy works, you got your keynsians and your classical liberals but Hayek and Krugman would both basically agree with everything taught in Econ 101.
But never mind that.
The garbage business is a low cost to entry business. It cost very little to buy a pick up truck to carry your neighbors garbage to the dump. Nor does it cost that much money to buy some land for a dump. Very different from the amount of infrastructure power generation takes.
I can guarantee you will not be able to start an energy company from your house for two reasons. 1. The power companies built and own all the electricity wires and existing power generation facilities. It is there property, they built it. It is going to cost you a ton of money to replicate that infrastructure with a second set of power lines. Since im assuming you want a FREE MARKET. Your also going to have to pay everyone who you run your power lines through their property a lot of money or lay down a lot of extra wire to go around people who don't want them. 2. You are going to have an economy of scale problem. If you build a large power plant per watt your energy costs a lot less than if you build a lot of little power plants. This because bigger generators are more efficient. If your making power with your average 20KWH generator that you could probably afford, It would cost you about national average 20 times as much as the grid. Obviously you could improve this somewhat by buying bigger generators, but your just not going to be able to be profitable or offer anything near competitive prices until you scale up to a industry standard generator that you can't afford. Never mind the fact that you absolutely could not afford to competitively ship your fuel sources via railroad or pipeline without tens of million of dollars in investment. If you try to ship it over by truck you would add another 20% to your operating costs. So no its impossible.
Ok maybe you realize now that your going to need a big company to provide your power. But the government is just making things worse. Maybe you think the EPA studies showing that unregulated coal power plants spewing mercury and unburnt ash causing cancer is fake news and rivers should just be giant sewers and all these pesky regulations are whats freezing texans. Never mind that many more people would die of cancer than are going to freeze to death. We can go full Beijing and just have unregulated emissions and giant smog clouds. That would save a little bit of money probably if you don't factor in healthcare costs. It would not be good for rural areas though. You see we already have a much less regulated monopoly in the US in the form of Internet service providers. It costs a lot more to build power lines to middle of nowhere towns than to cities and just like ISPs do you can expect companies without government incentives to provide rural power, just not really doing so or providing it at exorbitant rates. Laying a hundred miles of wire to power 4000 homes is not a huge profit for the public utility company in comparison of laying a hundred miles that power 90,000 homes in the city. So like ISPs there just going to be pretty shitty service. Rural electrification was largely a government program. Companies would never provide power to little Montana towns if the government didn't give tens of billions of dollars in subsidies to do so. By setting price controls the government is basically subsidizing the cost of power to people in rural areas at the expense of people in cities. Which great for you if your going to be a consistent anti-government stan but your going to pay more in power and I a city dweller might pay less depending on how much the monopoly price gouges