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					 Electrical demand in the future
through the eyes of the tragedy
    of the commons problem
    Tragedy of the Commons as a
             Social trap
• The Tragedy of the Commons is a type of social trap,
  often economic, that involves a conflict over resources
  between individual interests and the common good
• Social trap is a term used by psychologists to describe
  a situation in which a group of people act to obtain short-
  term individual gains, which in the long run leads to a
  loss for the group as a whole
• Examples of social traps include the over harvesting of
  fish species by commercial and sport fishers, the near-
  extinction of the American bison, the overgrazing of
  cattle, the destruction of the rainforest by logging
  interests, and energy "blackout" power outages during
  periods of extreme temperatures
       How Electric Power Works
•   The blackout on August 14, 2003 was the biggest in U.S. history. It raised a
    lot of questions about how our power distribution system works
•   At a high level, a power grid simply consists of a set of large power plants
    (hydropower, coal, nuclear power plants) all connected together by wires.
    One grid can be as big as half of the United States
•   A grid works very well as a power distribution system because it allows a lot
    of sharing. If a power company needs to take a power plant or a
    transmission tower off line for maintenance, the other parts of the grid can
    pick up the slack
       The Problem (How Stuff Works)
• The one remarkable feature of electric power is that it cannot store
  any power anywhere in the system
• At any moment, you have millions of customers consuming
  megawatts of power. At that same moment you have dozens of
  power plants producing exactly the right amount of power to satisfy
  all of that demand
• Supply = Demand at all times
• Unfortunately, there will be times, particularly when there is high
  demand, when the entire system is vulnerable to collapse
• Suppose the grid is running close to its maximum capacity
• Something causes a power plant to suddenly trip off line (lightening
  strike, fire in a generator)
• When that plant disconnects from the grid, the other plants
  connected to it have to spin up to meet the demand
• If they are all near their maximum capacity, then they cannot handle
  the extra load
• To prevent themselves from overloading and failing, they will
  disconnect from the grid as well
• That only makes the problem worse, and other plants also will
  disconnect. Blackout!
        Tragedy of the Commons in
              Electric Power
• One solution to the problem would be to build significant amounts of
  excess capacity -- extra power plants, extra transmission lines, etc.
  By having extra capacity, it would be able to pick up the load at the
  moment that something else failed.
• That approach would work, but it would increase our power bills. At
  this moment we have made the choice as a society to save the
  money and live with the risk of blackouts. Once we get tired of
  blackouts and the disruption they cause, we will make a different
• Therefore the short-term individual gain is to save money on our
  power bills, but this is at the expense of a long-run loss to everyone
  by not making investments in a power grid everyone uses
• Also, during periods of high demand, people still tend to over
  consume electricity gaining short run advantage but the
  disadvantage of increased risk of outage is share by everyone
                     Research future
•   It has been argued in physics literature on the basis of historical data and
    computer modeling that power grids are self-organized critical systems
•   This is a class of dynamic, non-equilibrium systems that exhibits
    unavoidable disturbances of all sizes, up to the size of the entire system,
    and attempts to reduce the probability of small disturbances only increase
    the probability of large ones
•   This has immediate policy implications:
•   How do we optimize the amount of blackout risk given the costs of
    engineering upgrades to the infrastructure?
•   How do we handle new increased demands on electricity (plug-in-hybrids)
    without a crisis?
•   How has deregulation and spot markets affected the power grid?
    (indications that deregulated electricity costs more)
•   Research technological externalities associated with transmission
    congestion and transmission loss.
•   What about adopting tradable transmission capacity rights?