The Pricing Premium for Reliable Energy

We are at a point in time, where it's become much easier to source incremental electricity power in different parts of U.S. than it is to reliably deliver electricity. This is because of the complexity + costs of building new infrastructure and upgrading old infrastructure.

These infrastructure challenges are a the main reason why utility costs are increasing and can be expected to increase over next bunch of years. It's created a super-inflationary cycle for electricity.

Why Is There A Super-Inflationary Cycle For Reliable Energy?

The primary cost driver is the aging energy infrastructure. Our grid must be updated to handle high-volume power from traditional fuel sources, and the variable flow from regionally and locally sourced renewables. This dual-source requirement mandates costly grid modernization projects and lengthy regulatory timelines.

Reliability. Reliability. Reliability

Guaranteeing reliability (capacity) has become an increasingly significant cost component of electricity. This involves investing in standby capacity like gas-fired peaker plants, as well as deploying utility scale battery systems - with their improving economics.

These reliability costs, coupled with the expensive transmission infrastructure needed for fuel and renewable sourced power, have become the primary reasons local energy prices are rising.