Ajay's word wizardry is unmatched. Wish some one trains a LLM on everything Ajay has uttered/written so far. I know it can't replace Ajay but at least the days between Fridays will be less agonizing.
I work as a building performance consultant and deal with solar, utilities, time of use pricing and so on everyday. But I ended up listening to Ajay like a schoolkid. Ajay you are such a gifted storyteller!
Just in awe of the sheer diversity of themes and subjects matter covered. This is nothing but inspiration for learning so much more everyday. This sort of learning I think will define the future of the knowledge society. I really think that the most important concept in the science of economics is “human capital”. And then, leave me alone, and I’ll make you rich!
Hello from EiE fan in UK. the roll out of smart meters to most households in UK is making this very model of peak electricity pricing almost a reality.
It was interesting to learn about the topic from a different perspective. Few related points: - - CIAL Airport located in Kerala, as its Earth's first fully solar powered airport. Cumulative installed capacity of CIAL's green projects is 50 MW. CIAL generates 2 lakh units of power daily, while its daily power consumption stands at 1.6 lakh units. This impressive power production positions CIAL as the second-largest power producer in Kerala after Kerala State Electricity Board. So now they are partnering with BPCL to set up a Green Hydrogen production facility using the excess power produced. -Sell the Tiger to Save It: - Reminded me of Chinese Panda Diplomacy. Where China leases its Pandas to countries like USA who in return will have to pay the rent. Which is then used for conservation effort of Panda in China.
Great episode, such lucid explaination! I took ~3 months to understand all of this back when I was supposed to understand this for a consulting project. I know there is so much to cover about this sector, but I would like to know more about the political economy of electricity in India. Why is it a regulated market? Especially when it is a part of the concurrent list of the seventh schedule of the Constitution of India, we should have seen different models evolve among different states, eventually converging into a free market model? What is the way out of it? If there were to be a determined CM who wished to get out of the electricity sector, how could they engineer 1991-like reform?
Why do governments interfere with the price system? The beneficiaries from interference are focused and visible, the harm is diffused. The ultimate harm from economic policy mistakes is underdevelopment and mass poverty.
@@ajayshah5705 Makes sense! Appreciate the response! Regarding my question on how could one engineer 1991-like reform in electricity sector, I guess the response would be to market the benefits correctly.
See the episode on the long road to change. There is a line that runs from Manmohan Singh PhD thesis in the 1960s to the revolution of exports 1991-2011.
Another exemplary episode. Great points on France getting 71 percent of its energy from nuclear and the price of electricity being zero on certain days at certain times in Germany. I was wondering if you guys could do a deep dive into the energy crisis in Europe as a result of the war in Ukraine? Germany's energy policy for example has come under increased scrutiny (i.e. their aversion towards nuclear and reliance on Russian gas). It would be great to understand the foreign policy decisions that were made in Europe with regards to energy in the last 10-15 years, how that came under pressure because of the war, how Europe is responding and how energy policy is going to look like in the future. Thanks again for continuing to educate us.
Dynamic Prices + Solar energy such an interesting idea. We need more episodes on electricity energy and climate change. You are a genius Ajay bhai. Keep bringing more ideas. India is lucky to have such a amazing mind.
i saw them in audience at a play day before yesterday and after seeing them so much on screen, it felt so real to see them irl and so unreal to see people with such wisdom around me. Thank you gentle sirs for doing what youre doing, you make us think and im grateful to you for that
Re nuclear liability - the problem is not just liability forever for even third party vendors, but ALSO unlimited liability. Bonkers to say the least, and from my naive point of view, just an excuse to not do the hard work of learning the hard subject of complex, critical procurements. I see it as “ let’s make the conditions so onerous, so that we don’t have any industry, so that we are spared the hard work of building that knowledge base” Highly uncharitable pov, but there is no love lost for government in my mind.
Total Power Capacity in India is 442 GW, total renewable capacity is 205 GW, peak demanded in India Recorded 250 MW, energy obtained from non-renewables is 80% that means renewables is undersupplying then we think. Humans move to energy dense system Branches-> Wood-> Coal-> Liquid Hydrocarbon/ Natural Gas-> Nuclear. Air and wind have energy density less than Wood
Thanks for this episode, Ajay and Amit. One question - what do you think are the challenges in implementing dynamic the dynamic pricing idea that you talk about in Chapter 3? It's a straight forward idea, so why has it not been implemented yet? Or are there any states where we are seeing any signs of this?
It's like many other large-scale Indian state interference in the price system. There is a whole establishment which thinks this way and makes a living out of the interventionist ways. But then, there was a time when the price of cement or steel was controlled. Hope springs eternal.
It needs huge consumer behaviour change, not easy.. Just installment of smart meter itself is causing backlash..But this can be started in highly posh areas of mumbai and Delhi where there is private distribution companies supplying electricity, then slowly spread outwards
Thank you for making such interesting videos. Please make episodes on international relations, geopolitics, military and history along with economics, public policy as well as wars. Really grateful to you two for creating this show. Waiting for the next one. Love from Kolkata
Illuminating! Indian Electricity Rules 2005 made an effort to liberalize the Power industry. But, many governments drove distribution companies to bankruptcy by defaulting on payments. When welfare economics is the flavor of the times, it is long before we realize a price-governed Power supply from the Free/subsidized Electricity adopted by all the federal governments. People should realize that it costs to generate power and getting it free costs them in some other ways. For example, power may be free but unavailable, defeating the whole purpose! Instead, they should insist on reliable quality power at a competitive price. That can happen only in a professionally regulated free market.
Loved this episode. Great insights as usual. A philosophical question. Amit has spoken of Gell-Mann Amnesia in the context of reporting and the media in general. I feel that there are a few areas where esteemed economists and polymaths /thinkers may indeed have missed nuance and perspective, possibly due to having to take a broader view of the issue out of necessity. Is there a point where one should “suspend disbelief” as a psychological defence mechanism since it is impossible to do one’s own research for everything one reads or sees? I am rambling and don’t really have more of a point to make but it’s a holiday on a Friday morning and I am having existentialist thoughts.
Through history there has always been the issue of the _right_ level of abstraction that is best suited for a given field / question / situation. There is no one recipe. On some questions it's good to be very specialised. And in many aspects it's wise to think breadth, to think inter disciplinary. See the Knowledge Society episode. The institutional arrangements of the world encourage specialisation and a disciplinary view. Hence the world pushes too hard into specialisation. The gains from breadth are 500 rupees notes lying on the ground. But this comes at a price, one has to read a lot and have friends who are experts in diverse fields. Amit and I recognise that in this show, we are generally interlopers in fields where powerful specialists lurk. Many times our breadth adds value. Many times we will be wrong, but in those situations also, there could be value in the line of inquiry and the inter disciplinary perspectives.
Very well said. Thank you for the insight, as always, as well as for engaging with an internet stranger screaming into the abyss. The generalist vs specialist debate is a frequent theme on the podcast as well. Didn’t Douglas Adams say something to the effect of the universe being so infinitely complex that the moment someone figured it out it would immediately be replaced by something even more inexplicable? I think I will have a nice cup of tea and a lie down.
That's Borges on how an accurate map of the world would have to be as big as the world itself. My addition to that is that it would immediately become inaccurate as the world is always in flux and you cannot step into the same river twice.
Letting market forces guide electricity will for sure more efficient systems. However I have few points of concern 1. What happens during calamities and natural disasters which may damage and destroy infra like solar, winds which will lead to huge spikes and critical establishments like hospitals can suffer. 2. What happens when you add options contracts in this market? These can lead to huge spikes which may lead to unaffordablity. 3. Hence I believe that critical systems should be kept under semi control 4. We saw what happened in Texas as winter set in, storm destroyed electric infra leading to huge spikes forcing people to spend the winter in freezing cold without heating
In a calamity the price of toilet paper goes up. That's the logic of the price system. As with a natural disaster, there is merit in finding ways to help poor people in those episodes. But these occasional events should not disrupt our normal rhythm of thinking in terms of the market economy. I do not share your fears about options trading (or, more generally, financial derivatives). We have myriad markets in the world where the spot market was accompanied by derivatives trading. Partly, it's about human freedom, if consenting adults want to enter into derivatives contracts with each other, it should be their right to do so. Partly, we know this field: by and large, the presence of sophisticated finance -- financial derivatives and algorithmic trading -- has improved `market efficiency' (the information content in the price). Texas. Yes. Remember, I am starting out with provocative scenarios like Rs.50 a unit. This is how the price system works. Those (rare!) events in Texas triggered off massive investments by self-interested players in the field of electricity. Texas is doing rather well on renewable and storage investments now. This is how the market economy works. The people plodding away for decades doing vaccines research should reap the fruits of their labour when the pandemic strikes.
There are very simple solutions for this. 15 mins dynamic pricing needs smart meters..so they can be programmed to cut off electricity if prices spike beyond a point say 15rs.. So in case massive disruption of supply, load also will suddenly drop and prices will even out
If you are talking of so much privatisation also add that taxes needs to be reduced drastically at lower ends.. Also, As an accountant in postal office, the blunders i see auditing bills each day makes me think why is gvt even into this shit anymore but they say service motive and also US has a public run postal system.Totally absurd. Tear down this postal sham immediately. Dont get me started on corrupt excise officials on ports and airports
Ajay's word wizardry is unmatched. Wish some one trains a LLM on everything Ajay has uttered/written so far. I know it can't replace Ajay but at least the days between Fridays will be less agonizing.
Ajay will be most displeased to read your suggestion!
@@amitvarma 🤐😶🌫
I work as a building performance consultant and deal with solar, utilities, time of use pricing and so on everyday. But I ended up listening to Ajay like a schoolkid. Ajay you are such a gifted storyteller!
Just in awe of the sheer diversity of themes and subjects matter covered. This is nothing but inspiration for learning so much more everyday.
This sort of learning I think will define the future of the knowledge society. I really think that the most important concept in the science of economics is “human capital”. And then, leave me alone, and I’ll make you rich!
Ajay Shah knows everything about everything!
Hello from EiE fan in UK. the roll out of smart meters to most households in UK is making this very model of peak electricity pricing almost a reality.
Another episode that requires re-listening a few more times. Thank you for such a concise and idea-dense presentation.
Such mind blowing concepts. I am just blown away with this channel. Thanks Amit and Ajay Shah. Fantastic!!
It was interesting to learn about the topic from a different perspective.
Few related points: -
- CIAL Airport located in Kerala, as its Earth's first fully solar powered airport.
Cumulative installed capacity of CIAL's green projects is 50 MW. CIAL generates 2 lakh units of power daily, while its daily power consumption stands at 1.6 lakh units. This impressive power production positions CIAL as the second-largest power producer in Kerala after Kerala State Electricity Board.
So now they are partnering with BPCL to set up a Green Hydrogen production facility using the excess power produced.
-Sell the Tiger to Save It: -
Reminded me of Chinese Panda Diplomacy.
Where China leases its Pandas to countries like USA who in return will have to pay the rent.
Which is then used for conservation effort of Panda in China.
Great episode, such lucid explaination! I took ~3 months to understand all of this back when I was supposed to understand this for a consulting project.
I know there is so much to cover about this sector, but I would like to know more about the political economy of electricity in India. Why is it a regulated market? Especially when it is a part of the concurrent list of the seventh schedule of the Constitution of India, we should have seen different models evolve among different states, eventually converging into a free market model? What is the way out of it? If there were to be a determined CM who wished to get out of the electricity sector, how could they engineer 1991-like reform?
Why do governments interfere with the price system? The beneficiaries from interference are focused and visible, the harm is diffused. The ultimate harm from economic policy mistakes is underdevelopment and mass poverty.
@@ajayshah5705 Makes sense! Appreciate the response!
Regarding my question on how could one engineer 1991-like reform in electricity sector, I guess the response would be to market the benefits correctly.
See the episode on the long road to change. There is a line that runs from Manmohan Singh PhD thesis in the 1960s to the revolution of exports 1991-2011.
Another exemplary episode. Great points on France getting 71 percent of its energy from nuclear and the price of electricity being zero on certain days at certain times in Germany. I was wondering if you guys could do a deep dive into the energy crisis in Europe as a result of the war in Ukraine? Germany's energy policy for example has come under increased scrutiny (i.e. their aversion towards nuclear and reliance on Russian gas). It would be great to understand the foreign policy decisions that were made in Europe with regards to energy in the last 10-15 years, how that came under pressure because of the war, how Europe is responding and how energy policy is going to look like in the future. Thanks again for continuing to educate us.
Dynamic Prices + Solar energy such an interesting idea. We need more episodes on electricity energy and climate change.
You are a genius Ajay bhai. Keep bringing more ideas. India is lucky to have such a amazing mind.
i saw them in audience at a play day before yesterday and after seeing them so much on screen, it felt so real to see them irl and so unreal to see people with such wisdom around me. Thank you gentle sirs for doing what youre doing, you make us think and im grateful to you for that
Fantastic episode! Loved Dr. Shah's points on the point of foreign policy.
loved the episode. got so manyr abbit holes to go down into.
Addicted to this series ❤
Re nuclear liability - the problem is not just liability forever for even third party vendors, but ALSO unlimited liability.
Bonkers to say the least, and from my naive point of view, just an excuse to not do the hard work of learning the hard subject of complex, critical procurements. I see it as “ let’s make the conditions so onerous, so that we don’t have any industry, so that we are spared the hard work of building that knowledge base”
Highly uncharitable pov, but there is no love lost for government in my mind.
Some recommendations -
- Serhii Plokhy’s works on The Soviet Union, Ukraine and Chernobyl
- Vaclav Smil’s works on Energy.
Good episode... Does the contact feature on india uncut work?
I think so.
Can't thank Ajay enough......
The supply and demand of solar power can be understood through duck curve
Total Power Capacity in India is 442 GW, total renewable capacity is 205 GW, peak demanded in India Recorded 250 MW, energy obtained from non-renewables is 80% that means renewables is undersupplying then we think. Humans move to energy dense system Branches-> Wood-> Coal-> Liquid Hydrocarbon/ Natural Gas-> Nuclear. Air and wind have energy density less than Wood
Thanks for this episode, Ajay and Amit.
One question - what do you think are the challenges in implementing dynamic the dynamic pricing idea that you talk about in Chapter 3? It's a straight forward idea, so why has it not been implemented yet? Or are there any states where we are seeing any signs of this?
It's like many other large-scale Indian state interference in the price system. There is a whole establishment which thinks this way and makes a living out of the interventionist ways. But then, there was a time when the price of cement or steel was controlled. Hope springs eternal.
It needs huge consumer behaviour change, not easy.. Just installment of smart meter itself is causing backlash..But this can be started in highly posh areas of mumbai and Delhi where there is private distribution companies supplying electricity, then slowly spread outwards
Beautiful sketch of central limit theorem in first 6 minutes
Thank you for making such interesting videos. Please make episodes on international relations, geopolitics, military and history along with economics, public policy as well as wars. Really grateful to you two for creating this show. Waiting for the next one. Love from Kolkata
This is episode 40. A lot of "international relations, geopolitics, military, history, economics, public policy, wars" is in episode 1 to 39.
Illuminating! Indian Electricity Rules 2005 made an effort to liberalize the Power industry. But, many governments drove distribution companies to bankruptcy by defaulting on payments. When welfare economics is the flavor of the times, it is long before we realize a price-governed Power supply from the Free/subsidized Electricity adopted by all the federal governments. People should realize that it costs to generate power and getting it free costs them in some other ways. For example, power may be free but unavailable, defeating the whole purpose! Instead, they should insist on reliable quality power at a competitive price. That can happen only in a professionally regulated free market.
TGIF ❤
Loved this episode. Great insights as usual. A philosophical question. Amit has spoken of Gell-Mann Amnesia in the context of reporting and the media in general. I feel that there are a few areas where esteemed economists and polymaths /thinkers may indeed have missed nuance and perspective, possibly due to having to take a broader view of the issue out of necessity. Is there a point where one should “suspend disbelief” as a psychological defence mechanism since it is impossible to do one’s own research for everything one reads or sees? I am rambling and don’t really have more of a point to make but it’s a holiday on a Friday morning and I am having existentialist thoughts.
Through history there has always been the issue of the _right_ level of abstraction that is best suited for a given field / question / situation. There is no one recipe.
On some questions it's good to be very specialised. And in many aspects it's wise to think breadth, to think inter disciplinary.
See the Knowledge Society episode. The institutional arrangements of the world encourage specialisation and a disciplinary view. Hence the world pushes too hard into specialisation. The gains from breadth are 500 rupees notes lying on the ground. But this comes at a price, one has to read a lot and have friends who are experts in diverse fields.
Amit and I recognise that in this show, we are generally interlopers in fields where powerful specialists lurk. Many times our breadth adds value. Many times we will be wrong, but in those situations also, there could be value in the line of inquiry and the inter disciplinary perspectives.
Very well said. Thank you for the insight, as always, as well as for engaging with an internet stranger screaming into the abyss. The generalist vs specialist debate is a frequent theme on the podcast as well. Didn’t Douglas Adams say something to the effect of the universe being so infinitely complex that the moment someone figured it out it would immediately be replaced by something even more inexplicable? I think I will have a nice cup of tea and a lie down.
That's Borges on how an accurate map of the world would have to be as big as the world itself. My addition to that is that it would immediately become inaccurate as the world is always in flux and you cannot step into the same river twice.
Gentle listener,I made him say that😂
Electrical Engineer here. Even four years of study can't make me speak in such flow.
Letting market forces guide electricity will for sure more efficient systems. However I have few points of concern
1. What happens during calamities and natural disasters which may damage and destroy infra like solar, winds which will lead to huge spikes and critical establishments like hospitals can suffer.
2. What happens when you add options contracts in this market? These can lead to huge spikes which may lead to unaffordablity.
3. Hence I believe that critical systems should be kept under semi control
4. We saw what happened in Texas as winter set in, storm destroyed electric infra leading to huge spikes forcing people to spend the winter in freezing cold without heating
In a calamity the price of toilet paper goes up. That's the logic of the price system. As with a natural disaster, there is merit in finding ways to help poor people in those episodes. But these occasional events should not disrupt our normal rhythm of thinking in terms of the market economy.
I do not share your fears about options trading (or, more generally, financial derivatives). We have myriad markets in the world where the spot market was accompanied by derivatives trading. Partly, it's about human freedom, if consenting adults want to enter into derivatives contracts with each other, it should be their right to do so. Partly, we know this field: by and large, the presence of sophisticated finance -- financial derivatives and algorithmic trading -- has improved `market efficiency' (the information content in the price).
Texas. Yes. Remember, I am starting out with provocative scenarios like Rs.50 a unit. This is how the price system works. Those (rare!) events in Texas triggered off massive investments by self-interested players in the field of electricity. Texas is doing rather well on renewable and storage investments now. This is how the market economy works. The people plodding away for decades doing vaccines research should reap the fruits of their labour when the pandemic strikes.
There are very simple solutions for this. 15 mins dynamic pricing needs smart meters..so they can be programmed to cut off electricity if prices spike beyond a point say 15rs.. So in case massive disruption of supply, load also will suddenly drop and prices will even out
Ajay is always an "expert"
baap re, I am so high on dopamine😵💫😵💫😵💫
If you are talking of so much privatisation also add that taxes needs to be reduced drastically at lower ends.. Also, As an accountant in postal office, the blunders i see auditing bills each day makes me think why is gvt even into this shit anymore but they say service motive and also US has a public run postal system.Totally absurd. Tear down this postal sham immediately. Dont get me started on corrupt excise officials on ports and airports
Crutches? I hope everything is alright?
See hiking episode
Promo-SM 💃
😡 spotify 🫘 when 🪱