Crypto uses more electricity than EVs already.
Data centers will likely use 20-100x more power than EVs
And we will all get to subsidize their electric and water use.
Without crypto and data centers our electric rates would be 30% lower and we aren’t even that far along
A few things here:
- Calling it "subsidizing" the data centres is a misnomer, they pay for the electricity too
- Supply cost is not only affected by demand, it's also affected by contracts and schemes designed to drive uptake of certain technologies, this compensation is out-of-market
- It is not unusual for large industrial consumers to get better rates than residential/commercial retail, part of the justification for this is that they are typically the loads that curtail during peak demand periods
- The example of Louisiana, they don't mention that Meta has said
they are going to add 1,500MW of VRE to "offset" their consumption. This again underscores my point about contracts and schemes driving uptake of certain technologies, typically at a premium.
This article says that Meta will pay the power costs of the $3.2bn in gas capacity being constructed, on a 15-year term, which runs contrary to the claim they are only paying half in the video.
- Consumers, collectively, have always borne the cost of infrastructure. Offloading costs of new infrastructure onto a specific class does the opposite of what is being claimed here, everybody is using the product of the datacentre, just like everybody is using the product of the smelter or steel mill, both of which are conventional large consumers that fit in the industrial category.
The real problem is that we haven't built any meaningful volume of new conventional powergen in decades because demand flatlined when everything started being outsourced to China. We have huge amounts of fully depreciated infrastructure, which, in most jurisdictions, has insulted rates from the effects of inflation. I say "most" because in places like California that went hog on subsidy schemes for VRE, their rates obviously went up to not only cover the cost of the assets, but those of the scheme as well. The Federal REC scheme, which also leveraged PPA's (another thing they got wrong in the video, saying that contracts are unusual, they are business as usual for wind and solar projects) has also had an impact on rates in recent years.
It's a complex problem and blaming it on the cost of generators that haven't even been built yet is very reminiscent of folks claiming in 2016 and earlier that the rate increases in Ontario were as a result of the Darlington refurbishment, not the Green Energy Act, even though not a cent had been spent on it yet, because it hadn't even started and we were locked in to cover more than $60 billion in contract costs for the wind and solar installed under the GEA.
Yes, power plants aren't free, but gas plants are cheap, and cheap to operate, they were the primary driver of nuclear shutdowns (mostly single unit plants), which had operating costs in the range of 4 to 6 cents per kWh, to provide some context. Power prices go up when power is scarce, this is a result of increasing demand without increasing supply, the solution is more clean baseload supply on the grid, which will drive down the market price, which in turn will drive down bills. We saw this play out in Alberta, who, after years of phasing out coal and going hog on wind and solar, saw a huge increase in rates. Bringing more gas capacity online has now calmed the market and reduced prices.
In jurisdictions without markets (Quebec) or pseudo markets (Ontario), the market price has no impact on consumer rates. Quebec rates are slated to go up to cover some new hydro builds, but not by a lot, and while Ontario rates have been flat since we elected Ford, we are building new nuclear plants, which is going to increase our cost, though we will also have some of the GEA contracts expiring, which will simultaneously bring them down, so we'll see how that balances out.
I truly hope the Ford Maverick does make it. It is one of the only trucks in the past 20 years I would finally consider buying if it proves not to have some of the engine problems many Fords have reported for several years now. I KNOW, Ford is not even the only one of the Big Three with problems.
