zlacker

>>Capsta+(OP)
Day ahead prices turning negative does not mean the wind and solar generators make a loss for every kWh they sell; they still receive country specific subsidies (production tax credits, feed-in-tariffs, contract for difference, renewables obligations ... and let's not forget about investment subsidies which helped to get the plant built) which make it worth their while to keep the blades spinning and the solar inverters humming. Otherwise what is the argument for subject your equipment to wear-and-tear and then paying for someone to take your product?

In addition there are more general system costs (the need for capacity payments to ensure electricity can be generated at peak times, as well as maintaining plants in reserve in case the weather isn't what was forecast the day ahead).

By this line of argument, negative prices on sunny/windy days increase the price of electricity to the consumer, since all of these subsidies need to be recouped (either by the tax or energy systems).

>>chicke+Kj1
It's hard to draw a link between negative prices and increased subsidies in most cases. The subsidies can be recouped during the no-negative periods. In addition, subsidies are not needed anymore to make wind and solar cost competitive. And with increased use of electric cars (and battery storage in general) we will see increased usage of this negative pricing to charge them so the negative price will diminish or go away.

Don't forget that we still produce most of our energy from coal, oil and gas. Most of that needs and will be replaced by electricity so there is a huge need for more electricity.

>>flakeo+Om1
> subsidies are not needed anymore to make wind and solar cost competitive

See https://ec.europa.eu/commission/presscorner/api/files/docume... where the European Commission approved the plan for the French state to give aid to push renewable deployment in France.

I google translated section 2.2 (paragraph 9) of the ruling document

> ... As such, the French authorities consider that there are “positive external effects” linked to the development of renewable electrical energies, in particular the reduction of greenhouse gas emissions from the electricity sector and the benefits in terms of robustness of the electricity sector. electricity supply linked to a more diversified electricity mix. These external effects are positive for the community but cannot be “monetized” by the investor. The French authorities consider that public support is necessary to have an investment in renewable energies that meets the expected collective benefits.

I would have expected inflation and interest rate changes to have negatively affected the viability of renewables. That is certainly the case for offshore wind in the UK (AR5 failed to produce any bids, AR6 has 66% higher maximum bid).