[Beowulf] electricity prices

Robert G. Brown rgb at phy.duke.edu
Tue Sep 25 13:44:29 PDT 2012

On Tue, 25 Sep 2012, Lux, Jim (337C) wrote:

> I'm going to assume that the data is some sort of bulk average over
> all industrial consumers.. And the prices are remarkably low (are they
> subsidized?)
> Does it include "distribution costs"..
> For instance, here in Southern California, my all-in price for the
> next kWh is anywhere from $0.11 to $0.34/kWh (0.085 Euro to 0.2627
> Euro/kWh), depending on what consumption tier I wind up in (there's 5
> tiers.. pretty much nobody is in tier 1, since the breakpoint is at 2/3
> the nominal minimum load for the dwelling size).
> However, of that, only about $0.05-0.07/kWh is the actual electricity
> cost (generation cost).  The remainder is transmission and distribution
> cost.  That is, I pay about $0.15/kWh to pay for the wires between the
> generator and me. (the $0.11/kWh tier is essentially subsidized by the
> >$0.20/kWh tiers.. a way to claim "we've reduced electricity rates")
> At the "biggest" scale (i.e. Spot prices from the generating plant) ,
> it looks like it's running about $40/MWh ($0.04/kWh) on the spot market,
> peaking up to $80 in the last few weeks (it's been very hot.. 40C)
> A large industrial consumer will be paying a lower distribution cost
> (perhaps $0.05/kWh) and closer to the spot price for the electricity.

Curiously, California prices are absurdly higher than they are in NC.
In fact, our price delivered to our door is around 0.10 kWh, less than
your distribution cost alone.  There is a nice map here:


To be honest, given the high costs of nearly everything in CA I'm amazed
that anyone ever locates anything there.  Land prices are high.  Housing
costs are astronomical.  Electricity is 2-3 times more expensive than it
is in most of the US.

There is evidence that a good chunk of this -- roughly a third,
comparing renewable portfolio standards (RPS) and non-RPS states -- is
due to California's adoption of stringent RPS for carbon and renewables.
This is not exactly a 'distribution' cost, it is more like a
self-imposed tax, one that could be abated at will by the voters in the
state.  The higher cost of electricity in California is thus at least
partly due to this de-facto carbon reduction tax, although it is
difficult to disentangle the cost of the renewable mandates from the
overall morass of costs without a rigorous cost-benefit analysis state
by state.

In the meantime, the higher costs of electricity provide a clear
incentive to locate computer clusters in states that have lower power
rates.  A 200 Watt computer, on 24/7, costs roughly $200/year in
electrical costs (allowing for a margin for cooling to balance heating)
-- rule of thumb is $1/watt per year assuming $0.1/kWh.  Where
electricity costs $0.3/kWh, it will be more like $600/year for a 200
Watt system, or enough to equal the up-front cost of the system (in many
cases) over its lifetime.  So it's off to West Virginia or Kentucky,
that have very low electrical rates...;-)


> Jim Lux
> -----Original Message-----
> From: beowulf-bounces at beowulf.org [mailto:beowulf-bounces at beowulf.org] On Behalf Of Per Jessen
> Sent: Monday, September 24, 2012 2:48 AM
> To: beowulf at beowulf.org
> Subject: Re: [Beowulf] In appropriate post (was "In the news again HPC in Iceland")
> Vincent Diepeveen wrote:
>> Oh comeon i've been over there myself - everyone knows that this
>> bunker has a max of a couple of hundreds of kilowatt of very expensive
>> electricity. 4.3 cents the article quotes. That's what i pay in this
>> office as well.
> According to this table, a kilowatthour is 8 cents in the Netherlands.
> http://www.energy.eu/#Industrial-Elec
> Only Bulgaria comes close with about 5cents/kwh.
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Robert G. Brown	                       http://www.phy.duke.edu/~rgb/
Duke University Dept. of Physics, Box 90305
Durham, N.C. 27708-0305
Phone: 1-919-660-2567  Fax: 919-660-2525     email:rgb at phy.duke.edu

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