That graph of Chinese vs US generation is impressive and meaningful, but I would also like to see the same graph in per capita terms from time to time.
I largely agree with you, but the chart comparing us with China feels dubious. China has four times as many people as the US, yet even with their recent growth are *not* generating four times as much electricity.
Hey Matt, industry professional here. Happy to discuss this more but “Most other places have a tighter set of tradeoffs — between decarbonization, consumption of open land, cost, etc. — to negotiate but no mechanism to plan them. “ this is incorrectly it’s not that they have no mechanism to plan them it’s that the constraints they set on the system are extremely binding. This drives prices up
This has been a good comment thread. I don’t have an opinion on much of this, but there are lots of people here spitting out seemingly expert knowledge. Thanks
One of the problems with just having competition for energy production is that it can be difficult to do that usefully without good long distance power transmission.
I mean suppose Indiana needs roughly 2000 MW new production capacity in 10 years. If the most efficient way to create that electricity is one big 2000 MW plant the only way to make this work for investors is if only one company builds a plant. If two rival teams both build a plant they both lose a ton of money.
Hence why people who want to build the big baseline plants reasonably want agreements committing to buy so much electricity at such and such rates. But that basically just makes them subcontractors to the monopoly. It's not at all clear that you've really deregulated anything there, you've just slightly shifted who takes the risk and gets the rewards but that probably just averages out in the long term.
Worse, because you can't count on the national grid to average out local demand spikes or winter storms you need to over supply electricity. I know there are some complicated inducements the regional interchanges do to allow for this but any kind of upfront commitment to pay in exchange for creating the capacity weakens the benefits of competition.
Having said this, if you have sufficient long range power distribution this becomes much less of an issue. We already have regional exchanges but if we had much better grid interconnects it might be enough that we get into a situation where individual projects aren't large compared to the overall demand.
I'm not totally sure how big an issue this is just saying we need better long distance interconnects.
"This whole obsession with reducing utility R.O.I. is really downstream of the degrowth strain of environmentalism associated with Amory Lovins."
This is completely unserious, defamatory bullshit. Amory Lovins has not and would not ever advocate what any sane person would characterize as "degrowth". Maximizing efficiency from economical non-carbon sources does not lead to "degrowth", it generates new "supply" by eliminating waste through better planning and better engineering without changing the experience of the end-user ("hot showers and cold beer"). His work is a monument to the demonstrably provable proposition that the grotesque waste of the fossil-based fuels that MY so assiduously promotes can be overcome and eventually eliminated with relatively simple engineering improvements, electrification of as much as possible and continued GROWTH of renewables and battery infrastructure, thereby attenuating the waste and emissions of the more than 2/3rds of "energy" that we throw away every day as fossil (and nuclear) generated heat into the atmosphere. Anybody who can read a simple chart should be able to understand this, so it baffles me to see that MY seems once more to be incapable of this simple cognitive exercise. Or else, it's just a cheap shot at a person with deep knowledge and five decades of experience in the space who MY perceives (weirdly) as some kind of ideological threat to his own poorly-informed and dilettantish pro-fossil fuel agenda.
All human energy consumption (let alone waste heat from electricity generation) is something on the order of 10,000 times less than the energy the planet receives from the sun. Waste heat is completely negligible from an environmental perspective, unless you’re pumping it into a small heat reservoir like a river. Most power plants use evaporative cooling though as far as I’m aware. It is not a compelling argument against fossil fuel or nuclear use, especially when compared to other arguments available (CO2 emissions most obviously)
Not sure what you're talking about. The "waste" is the gap between the emissions (and cost) of unit of material purchased (oil, gas, coal) and the useful energy obtained. That waste is expressed as heat because that is what combustion produces.
Waste heat is a technical term for the difference between the amount of thermal energy used to turn a steam turbine and the amount of useful work extracted from it. I’m not sure if we disagree on that point, but what I’m trying to emphasize is that it is not “waste” in the sense of pollution (it has no noticeable effect on the environment) and isn’t “wasted” (there’s no other way to turn that potential energy into useful energy). Talking about it like it’s a negative attribute of thermal power stations comes across as a cheap rhetorical move. Geothermal and nuclear power produce an essentially identical amount of waste heat as combustion; it’s defined by the thermal efficiency of the turbine.
You begin with a comparison to China, which shows them lapping us in generating capacity, but you don't really examine that. China seems to be one big TVA, and I believe it's worth really thinking about what that means.
Matt outlined the three basic flavors of production/delivery, and compared the second two a bit. But what about publicly owned utilities? What are the tradeoffs between investor and publicly owned?
Dismissing the work of Rocky Mountain Institute and Amory Lovins as "downstream of the degrowth strain of environmentalism" reveals a profound misunderstanding of what RMI and Lovins' "soft energy" is and has become over the decades. Although Lovins' original PhD thesis work of 1976 was motivated by a desire to eliminate the need for nuclear power, it is actually a proposition for increasing global standard of living and quality of life via a very obvious engineering principle: efficiency first. Lovin's organization pursues this goal through coordinating research and advising corporations and states on efficiency measures that deliver significant operating cost reductions while preserving or advancing living standards.
That's not degrowth - that's smart growth. It has been used in the corporate sphere - Walmart's distribution network upgrade is a famous early success - as well as by several U.S. states and emerging economies - India and China have been two long-time clients of RMI. Lately a notable project has been to accelerate the development of high-efficiency air conditioning to support climate warming adaptation efforts. The results have seeded productization of air conditioning systems that are up to 5 times as efficient as current technology.
With the rise of AI and its vast energy demands, the whole economic infrastructure, energy grid, and energy use profile has to rapidly become more efficient to support it. RMI has been wildly successful in using ROI strategies to do this. Yes, they remain skeptic of a heavily nuclear power grid. But they're not stupid, and they know that the solution to our energy demands requires more than just power generation. The success of their approach has been well-documented and will be absolutely essential.
The Lovins of 1976 is not the Lovins and RMI of 2026. We dismiss their holistic engineering approach at our peril.
"Utilities in the United States come in three basic formats..." Matt engaged in co-op erasure! How dare he!
In all seriousness the co-ops, which evolved from New Deal era rural electrification programs, are more prevalent in the southeast and midwest and are based on (in theory at least) the idea of the customers owning the utility and policy being guided by a board of elected leaders. The reality can be a lot more complicated than that though. Some are are pretty small time rural outfits but due to things like consolidation and suburban development into what was once rural utility areas some can now be pretty big and influential: https://en.wikipedia.org/wiki/Great_River_Energy
They present their own set of challenges, which is just another way to say that just when you think you got a hang of the lay of the land in this policy space you realize it's actually a lot more complex than you thought.
It seems like one of the impediments is that power companies get paid for a return on the infrastructure investment. That disincentivizes companies to transmit other people’s power. But that’s just a construct of the regulation. Why not change the regulatory structure to allow for a reasonable return on power transmission. It then becomes incentivized to transmit power to and from a myriad of points on the grid.
That graph of Chinese vs US generation is impressive and meaningful, but I would also like to see the same graph in per capita terms from time to time.
I largely agree with you, but the chart comparing us with China feels dubious. China has four times as many people as the US, yet even with their recent growth are *not* generating four times as much electricity.
Isn’t FERC order 1920 (https://www.ferc.gov/news-events/news/ferc-strengthens-order-no-1920-expanded-state-provisions) exactly the kind of long term inter regional planning mechanism you have in mind?
Hey Matt, industry professional here. Happy to discuss this more but “Most other places have a tighter set of tradeoffs — between decarbonization, consumption of open land, cost, etc. — to negotiate but no mechanism to plan them. “ this is incorrectly it’s not that they have no mechanism to plan them it’s that the constraints they set on the system are extremely binding. This drives prices up
This has been a good comment thread. I don’t have an opinion on much of this, but there are lots of people here spitting out seemingly expert knowledge. Thanks
Yeah it has been nice since top comments that aren't just from the Usual Suspect super-poster brigade.
We don't need as much electricity as China because we banned their superior, cheaper EVs. 😒
Hopefully, we will in the future. I'm still mad about that.
I think Matt's right about us needing to plan for growth.
Good post
One of the problems with just having competition for energy production is that it can be difficult to do that usefully without good long distance power transmission.
I mean suppose Indiana needs roughly 2000 MW new production capacity in 10 years. If the most efficient way to create that electricity is one big 2000 MW plant the only way to make this work for investors is if only one company builds a plant. If two rival teams both build a plant they both lose a ton of money.
Hence why people who want to build the big baseline plants reasonably want agreements committing to buy so much electricity at such and such rates. But that basically just makes them subcontractors to the monopoly. It's not at all clear that you've really deregulated anything there, you've just slightly shifted who takes the risk and gets the rewards but that probably just averages out in the long term.
Worse, because you can't count on the national grid to average out local demand spikes or winter storms you need to over supply electricity. I know there are some complicated inducements the regional interchanges do to allow for this but any kind of upfront commitment to pay in exchange for creating the capacity weakens the benefits of competition.
Having said this, if you have sufficient long range power distribution this becomes much less of an issue. We already have regional exchanges but if we had much better grid interconnects it might be enough that we get into a situation where individual projects aren't large compared to the overall demand.
I'm not totally sure how big an issue this is just saying we need better long distance interconnects.
"This whole obsession with reducing utility R.O.I. is really downstream of the degrowth strain of environmentalism associated with Amory Lovins."
This is completely unserious, defamatory bullshit. Amory Lovins has not and would not ever advocate what any sane person would characterize as "degrowth". Maximizing efficiency from economical non-carbon sources does not lead to "degrowth", it generates new "supply" by eliminating waste through better planning and better engineering without changing the experience of the end-user ("hot showers and cold beer"). His work is a monument to the demonstrably provable proposition that the grotesque waste of the fossil-based fuels that MY so assiduously promotes can be overcome and eventually eliminated with relatively simple engineering improvements, electrification of as much as possible and continued GROWTH of renewables and battery infrastructure, thereby attenuating the waste and emissions of the more than 2/3rds of "energy" that we throw away every day as fossil (and nuclear) generated heat into the atmosphere. Anybody who can read a simple chart should be able to understand this, so it baffles me to see that MY seems once more to be incapable of this simple cognitive exercise. Or else, it's just a cheap shot at a person with deep knowledge and five decades of experience in the space who MY perceives (weirdly) as some kind of ideological threat to his own poorly-informed and dilettantish pro-fossil fuel agenda.
All human energy consumption (let alone waste heat from electricity generation) is something on the order of 10,000 times less than the energy the planet receives from the sun. Waste heat is completely negligible from an environmental perspective, unless you’re pumping it into a small heat reservoir like a river. Most power plants use evaporative cooling though as far as I’m aware. It is not a compelling argument against fossil fuel or nuclear use, especially when compared to other arguments available (CO2 emissions most obviously)
Not sure what you're talking about. The "waste" is the gap between the emissions (and cost) of unit of material purchased (oil, gas, coal) and the useful energy obtained. That waste is expressed as heat because that is what combustion produces.
Waste heat is a technical term for the difference between the amount of thermal energy used to turn a steam turbine and the amount of useful work extracted from it. I’m not sure if we disagree on that point, but what I’m trying to emphasize is that it is not “waste” in the sense of pollution (it has no noticeable effect on the environment) and isn’t “wasted” (there’s no other way to turn that potential energy into useful energy). Talking about it like it’s a negative attribute of thermal power stations comes across as a cheap rhetorical move. Geothermal and nuclear power produce an essentially identical amount of waste heat as combustion; it’s defined by the thermal efficiency of the turbine.
"grotesque waste of the fossil-based fuels that MY so assiduously promotes "
Your phrasing is incredibly unconvincing. You come across as an unthinking zealot.
Thanks for sharing. If you are familiar with MY's "work" in this area you will not be taken aback by this quite fair assessment.
You begin with a comparison to China, which shows them lapping us in generating capacity, but you don't really examine that. China seems to be one big TVA, and I believe it's worth really thinking about what that means.
Perhaps more of a mailbag question, how does one make sense of this:
1. TVA was wildly, unimaginably successful.
2. Let's never ever make that mistake again!
Adding my own question as an extension to this...
Matt outlined the three basic flavors of production/delivery, and compared the second two a bit. But what about publicly owned utilities? What are the tradeoffs between investor and publicly owned?
At its peak during WWII the Oak Ridge nuclear facility was consuming 14% of America's electricity - most of it supplied by the TVA.
Also fascinating Oak Ridge employed 80,000 people and almost none of them knew what it was for.
My first born for a (Manhattan) Project 2029 for commercial nuclear fusion. Make energy scarcity obsolete, defang the petro-states.
I dream of a future in which every home, vehicle, and factory is powered by a small matter/antimatter reactor.
And phones that never need to be charged.
Dismissing the work of Rocky Mountain Institute and Amory Lovins as "downstream of the degrowth strain of environmentalism" reveals a profound misunderstanding of what RMI and Lovins' "soft energy" is and has become over the decades. Although Lovins' original PhD thesis work of 1976 was motivated by a desire to eliminate the need for nuclear power, it is actually a proposition for increasing global standard of living and quality of life via a very obvious engineering principle: efficiency first. Lovin's organization pursues this goal through coordinating research and advising corporations and states on efficiency measures that deliver significant operating cost reductions while preserving or advancing living standards.
That's not degrowth - that's smart growth. It has been used in the corporate sphere - Walmart's distribution network upgrade is a famous early success - as well as by several U.S. states and emerging economies - India and China have been two long-time clients of RMI. Lately a notable project has been to accelerate the development of high-efficiency air conditioning to support climate warming adaptation efforts. The results have seeded productization of air conditioning systems that are up to 5 times as efficient as current technology.
With the rise of AI and its vast energy demands, the whole economic infrastructure, energy grid, and energy use profile has to rapidly become more efficient to support it. RMI has been wildly successful in using ROI strategies to do this. Yes, they remain skeptic of a heavily nuclear power grid. But they're not stupid, and they know that the solution to our energy demands requires more than just power generation. The success of their approach has been well-documented and will be absolutely essential.
The Lovins of 1976 is not the Lovins and RMI of 2026. We dismiss their holistic engineering approach at our peril.
That we want to generate more electricity seems amazingly obvious. Of course its controversial on the Northeast D:
"Utilities in the United States come in three basic formats..." Matt engaged in co-op erasure! How dare he!
In all seriousness the co-ops, which evolved from New Deal era rural electrification programs, are more prevalent in the southeast and midwest and are based on (in theory at least) the idea of the customers owning the utility and policy being guided by a board of elected leaders. The reality can be a lot more complicated than that though. Some are are pretty small time rural outfits but due to things like consolidation and suburban development into what was once rural utility areas some can now be pretty big and influential: https://en.wikipedia.org/wiki/Great_River_Energy
They present their own set of challenges, which is just another way to say that just when you think you got a hang of the lay of the land in this policy space you realize it's actually a lot more complex than you thought.
It seems like one of the impediments is that power companies get paid for a return on the infrastructure investment. That disincentivizes companies to transmit other people’s power. But that’s just a construct of the regulation. Why not change the regulatory structure to allow for a reasonable return on power transmission. It then becomes incentivized to transmit power to and from a myriad of points on the grid.