Even in this article, it repeatedly refers to building out infrastructure in advance of an obviously approaching future need as "oversupply".
This is almost a cliche in reporting on China that seems to reflect a serious blindpsot in western media and/or business attitudes.
You can find plenty of articles complaining about "overcapacity" of battery factories in China even as they double in capacity and output each year.
Chinese electricity generation went from 4,000 TWh (the same as the US) in 2010 to double that in 2020. The US was basically the same after 10 years.
So a 100% "oversupply" in 2010 would be a zero percent oversupply within a decade given China's growth.
Most telling to me is that decarbonisation and electrification of transport and heating has long been known to require a doubling(!) of electricity production for developed nations (and a similar increase in developing nations where it gets hidden by other growth).
Apparently the US simply never had a plan to achieve that, and amazingly it still isn't part of the conversation around AI power. Instead they're just claiming the best parts of the existing power systems and passing the costs onto local consumers.
The simplest explanation is this is political language. People in politics use something close to doublespeak with they have two words for the same act, one good and one bad (terrorist/freedom fighter for example). The word used is chosen based on whether they think the situation is good or bad for their personal interests.
So in this case the pair is something like oversupply/abundance. Same thing, but one word for when it favours the speaker and one when it doesn't. I think he just means the Chinese are willing to build whatever if it makes commercial sense.
I'm old enough to have seen this shift happen first hand. I remember the language being used in the early 90s when US-China relations were great, with evening news clips of smiling Bill Clinton and Jiang Zemin yukking it up as hundreds of thousands of jobs were offshored to China to American politicians and industrialists delight.
Did people in America and the rest of the developed world not delight in lower priced goods? Surely businesses were incentivized to reduce their costs without regard to what politicians want, because it is a business. And consumers are incentivized to reduce their costs, because they want to consume.
You either want a plan like China or an absence of planning like Texas. Either help like China or get out of the way like Texas. Two places that can actually build energy. Don't be like California where the government doesn't help while also getting in the way.
The same Texas that has statewide power outages every time it gets below freezing (despite knowing for 25+ years it’s a problem) because of their lack of regulation and central planning?
I would not entirely dismiss the way the power market works in Texas. I have not disagreement the 2021 storm should never have happened. At the same time though, I don’t believe other energy markets work very well either. I would prefer a more Texas like approach but with some thoughtfulness around capacity instead of just generation.
> I have not disagreement the 2021 storm should never have happened.
But they still haven’t fixed any of the issues. The exact same thing is going to happen again when (not if) it freezes.
> I would prefer a more Texas like approach but with some thoughtfulness around capacity instead of just generation.
Capacity isn’t the issue. Lack of winterization of pumps is the issue. Because that costs money and private companies have zero incentive to make the investment if government doesn’t force them to.
Winterization is a fix for last time’s failure, not a strategy for the future. A market like Texas can work if it values resilience alongside price efficiency, meaning capacity planning, diversified generation, and yes, some enforced standards. Otherwise you’re just running a lean system that collapses the moment reality strays from the model.
That storm was an issue for other markets as well but they were mostly able to get away with rolling blackouts due to interconnects. Those same markets and similar winterization issues but were under FERC guidelines. Folks love to anchor onto to winterization issue like it did not impact other FERC regions.
>Winterization is a fix for last time’s failure, not a strategy for the future. A market like Texas can work if it values resilience alongside price efficiency, meaning capacity planning, diversified generation, and yes, some enforced standards. Otherwise you’re just running a lean system that collapses the moment reality strays from the model.
What are you even trying to say? A private company isn't going to magically "value resilience" if there's no incentive to do so. They make MORE money when they have outages, why would they prevent that? The solution to the issue, which has worked literally everywhere else, is government regulation.
Talk about missing the forest for the trees. "If only capitalism didn't work the way it works it would be perfect".
>That storm was an issue for other markets as well but they were mostly able to get away with rolling blackouts due to interconnects. Those same markets and similar winterization issues but were under FERC guidelines. Folks love to anchor onto to winterization issue like it did not impact other FERC regions.
Citation of which other markets had blackouts due to not winterizing pumps that had been called out repeatedly after identical outages prior in 2010 and 1989? You conveniently left that out, I'm sure it was just an oversight.
Because if I had to bet money, you're talking about the power companies in other states who WERE prepared for the freeze asking homeowners to drop their thermostats a couple degrees because the cold snap was driving demand significantly higher than normal. NOT because of power plant outages due to lack of preparation and component failure - due to lack of regulation.
You’re clearly frustrated here, but let’s keep it in the realm of facts rather than snark. I didn’t “leave out sources” to hide anything, I was speaking from the same public data you can find in FERC/NERC’s joint report on the 2021 event.
SPP did in fact suffer significant generation losses, around 30% at peak, during the February 2021 storm. Causes were mixed: natural gas supply constraints, plant equipment failures, and yes, winterization gaps. Prior to that event, FERC’s winterization guidance was minimal and largely voluntary, so both SPP and ERCOT were operating without strong federal mandates.
The difference in outcomes wasn’t that SPP magically avoided the same issues, it was that SPP is interconnected with MISO and other regional grids. That allowed them to rotate outages in short windows to maintain stability, while ERCOT’s ~50% generation loss, combined with its isolation from other grids, meant load shedding had to be longer and deeper to prevent collapse.
If we’re going to critique Texas’s market, we should separate the “market structure” question from the “operational standard” question. A competitive market like ERCOT’s can work, but without binding requirements on winterization and resource adequacy, you’re just betting the grid on ideal conditions. SPP’s experience shows that interconnection alone doesn’t prevent failures, but it does give operators more options when the weather turns.
Can you drop some of the hyperbole and passive aggressiveness? You don’t even understand my position yet being quite passive aggressiveness for no reason.
I'm done with the discussion until you can provide a link to all the other states under regulation that had outages as as result of frozen pumps that had occurred multiple times over the previous 25+ years.
It's a straightforward ask that you're actively avoiding because it didn't happen and contradicts the story you're fabricating.
Not sure why you are so angry. I am trying to help you understand at least my perspective but you keep being quite aggressive for no reason.
You are framing this as if the only relevant comparison is “multiple frozen pump events over 25+ years,” but that is narrowing the scope to avoid the larger point. The February 2021 FERC/NERC report clearly documents that frozen instrumentation, valves, and pumps occurred in both regulated and unregulated markets during the same storm. SPP, MISO, and even parts of PJM experienced outages tied to equipment freezing, though the scale and duration differed because of interconnection and resource diversity.
What is different in Texas is not that freezing only happens there, but that ERCOT lost roughly 50 percent of its generation and could not import meaningful power to offset it. SPP lost about 30 percent, had similar natural gas and winterization issues, but managed to rotate outages for shorter periods because it could pull from neighboring grids.
If you want the source, the joint FERC, NERC, and regional entity “February 2021 Cold Weather Grid Operations” report is publicly available and breaks this down by region. It does not fit the claim that regulated markets never see cold-weather-driven pump or plant failures. The record shows they do, but their structure gives them more tools to manage the consequences.
My whole original point was that a more market based generation and consumption model should not be overlook but let’s go through some simple facts because I think your narrative is off track.
1) Both Ercot and SPP had winter weather failures during that storm. Pretty similar on the natural gas side, frozen wells, lack of supply, huge spikes in the spot market.
2) SPP which is federally regulated had very similar winterization voluntary guidelines in place. Post event there are now new rules in place for winter.
3) SPP was able to fair better because they used a rolling blackout to different regions. Using the interconnect they could get energy from outside their grid and create short 60min blackouts. ERCOT had no luxury because of their lack of real interconnects.
You’re more than welcome to read the review of the event from SPP. They call out well-head freeze offs, frozen cooling towers, intakes, fuel lines, etc. 50% of forced generation was a fuel supply issue.
You’re making it sound like Texas was an outlier here. It was not, SPP had the same exact issues of course with a slightly different fuel mix but they got by better with their interconnects. I don’t know why you are struggling to see that this winter event caught other grids by surprise. I am not defending Texas here but simply pointing out facts compared to your modified narrative.
> I don’t believe other energy markets work very well either.
but is isn't even about that storm, big "oh no" situations happen sooner or later (e.g. see energy outage in Spain) what is important is that you learn from it.
but more important in this argument is the general design, how can it handle flexible loads, how can it share loads between areas, how many ways to handle partial failure does it has etc.
and Texas is kinda not that good in all of that AFIK
the problem is that there are markets where politics fully getting "out of the way", doesn't work as the market dynamics favor things which might be better for the people running the gird, but are bad on a state economical level anyway (but getting in the way here is using tax money to make sure the net is stable, not getting int the way of that to protect personal investments)
it's a bit like freighttrains in many parts of the EU, there operating does in most situation make no profit. But having them is helping the economy as a whole and can (implicitly) safe the state/region etc. money. So it makes sense to place some tax money into making them still viable to operate as that investment in a roundabout way saves more money then spend.
I agree that the ability to adapt, whether to flexible loads, partial failures, or cross-area balancing, is the real test of a grid design. Texas’s isolation means it inherently lacks some of the tools SPP or MISO can use, which makes resilience harder. That is not a “market” problem so much as a structural one. ERCOT’s ruleset was built to optimize for low-cost generation in-state, not multi-region contingency planning.
Where I think a Texas-like market could work better is if you layered competitive generation with enforceable capacity and resiliency standards, along with some interconnection flexibility. Right now, the market rewards generators for selling MWh in good weather, not for being ready in bad weather. That is the economic misalignment.
The EU freight analogy works in the sense that reliability is often a public-good investment. No private actor has the incentive to overbuild or maintain resources for rare events. Texas’s approach does not have to mean politics fully getting out of the way. It could mean using market signals to keep prices efficient while still mandating the backup, winterization, and grid-sharing capabilities that the economy needs.
This just shows how you know only the talking points. The power outages are not due to lack of central planning, it's very explicitly the reverse. If Texas were hooked up to the rest of the country, those outages would not be a thing. It's the purposeful regulation that has caused those problems.
So you're saying when the Texas grid fails, it's because of over overegulation. But the solution to those failures is to tap into the national grid, a grid that follows stricter FERC regulations.
I guess you’re saying that the current status is mandated by the design of the grid. Which is true, but that status would be best described as “deregulated” rather than “purposeful regulation.”
Lack of regulation and oversite around weatherization and redundancy is the main source of our problems. The Texas’ grid is market based and so unregulated that it’s not connected to the national grid so it can avoid federal regulation.
Every single state surrounding Texas was also suffering from power outages due to the winter storm in 2021, despite all of those states being part of the non-Texas interconnections. The outages in those states weren’t as bad, but even if Texas was better connected to them, there’s no guarantee that they would have had any power to share.
I was personally without power for 72 hours in sub zero temps. Every night I went to bed and wondered if my kids would be alive when/if I woke up. You know what that feels like?
I can’t do anything to *guarantee* you’ll never experience it, but I can take steps to decrease the chances or decrease the severity/dueation. I think my kids are worth it. Even if it’s not a *guarantee*.
Now that’s out of the way. I recommend you listen to the podcast. Really. Even if you lived through it. Even if you think you know everything about it. You will learn something I guarantee. It’s well produced and an easy listen. It’s an eye opener too. “The Disconnect”
Your condescending appeal to emotion does nothing to change the facts. My family and I too lived through the winter storm, going multiple days without power. It doesn’t change anything about what I said. The national-vs-local-grid topic is a red herring, as even the non-Texas grids were without power. If you want to actually change things, you need to acknowledge these facts rather than letting yourself be controlled by emotion.
> The power outages are not due to lack of central planning
It is 100% due to lack of central planning. The outages were caused by a lack of winterizarion of natural gas pumps which was a known issue in Texas but the lack of regulation meant companies could just ignore the problem. Why invest in winterizing when you can just jack up prices and make even more money when they freeze and there’s not enough power to meet demand?
There’s a reason the power doesn’t go out in the winter anywhere else in the country when it gets below freezing and it’s not “a lack of regulation”.
Winterization was a problem but it was also a problem for other regions that are part of FERC. You’re latching onto the wrong problem. FERC has updated guidelines since that storm.
- many of the most influential people are invested into Oil and similar
- the political stance had been for a long time that "there should be a fair competition" between energy sources ... while subventionieren non renewable and trying everything they can to prevent subventions for renewable
- the same Texas which once it realized solar is competitive in Texas without subventions, has been non stop looking for ways to actively hinder solar (while still subvention the non-renewable sector)
- the same Texas which is by now even internationally known to have a very brittle power grid
Why mess with Texas when it's so good at messing with itself?
There are at least 120 people, including more than 35 children, who just drowned because Texas is so unjustifiably arrogant about being messed with by experts and scientists and educators and government regulations.
I wish the modern Texas secession movements the best of luck, and hope they get exactly what they deserve, including my thoughts and prayers!
There's nothing "obvious" in hindsight about the explosion in LLMs in 2023 and thus the increased energy demand, and the China certainly wasn't building for that.
It very much was overcapacity as a way to keep the construction and manufacturing employed even when most profitable opportunities have been realized. Of course, the long cost of that is involution and lack of nicer jobs as capital is malinvested into diminishing returns. The ironic thing is that idea of overcapacity itself is acknowledged by the CCP in their calls to end price wars and involution
I do think there’s is a very interesting dynamic in this meta argument; over the past 5 years or so, the “debunkers” have taken issue with “whistleblowers” arguments towards first zero covid, then local government debt, and now overcapacity and lack of consumer demand and “debunked” these as all being not an issue, only for the central government to turn around and end Zero Covid, rein in LGFV lending, and now the current crackdown on “disorderly competition” and mass dispersal of consumption vouchers. English Pro-China commentators don't appear to be well aligned with the actual views in China!
I have a feeling that this kind of efficiency/capacity analysis is similar to that joke about economist designing a human, instead of having two kidneys you have 5 people sharing one. I am a pro market guy for a lot of things, but what happens when you let the market operate something like basic infrastructure is everyone is shipping their shit/sewage in trucks and running a diesel power generator in their back yard.
Well first of all, that's not happening in America. The basic gist of this topic is that there suddenly a massive upsurge in energy demand, and existing networks trouble accommodating for it. Big deal, just build more power plants. The inability to build is the opposite of pro-market, it's literally NIMBYISM and government regulations causing that.
Second of all, when we talk about malinvestment, it's about opportunity cost. Right now, the job market is pretty bad in China, consumption is weak, and businesses are killing themselves in deflationary price wars. Chinese Gen Z don't want to work factory jobs either, but white collar jobs like the West, but many of the industries related to those were suppressed. And this is all because the government chose to overinvest in propping up their manufacturing and construction rather than increasing consumption and fostering their services. For you as a rich American you can admire their cheap goods and cities, but you're also not exposed to the reality of the extreme competition in that society.
There are four things increasing energy demand in the US at roughly the same rate, each very roughly about 1% per annum:
- increasing demand due to GDP & population growth
- increasing demand due to the increased use of air conditioning due to global warming
- increased demand due to EV's and other decarbonization efforts
- increased demand from AI
Only one of those 4 things wasn't highly predictable. A robust build out for the first three would have gone a long way to covering the fourth. In the past increased demand was covered by increased efficiency in heating and lighting, but those gains are slowing, and Trump's gutting of regulations will reverse them.
> Apparently the US simply never had a plan to achieve that, and amazingly it still isn't part of the conversation around AI power. Instead they're just claiming the best parts of the existing power systems and passing the costs onto local consumers.
I wonder if this is more of a cultural thing, meaning Western cultures being more aligned to short-term gains instead of long-term gains. I mean, look at the Dujiangyan irrigation system that was build 2500 years ago and is still maintained until today. This isn't something the Western world would even consider.
The structure of the United States government is a compromise balancing large vs. small states interests and slavery.
The core defect in the design is the Senate and the way states were admitted. We have a territory/colony with limited political rights that has a population greater than the bottom four states.
Those small states exert enormous influence and essentially ensure a weird conservative dynamic that anchors a lot of social issues.
Not because of the politics of the day - because resource extraction is always conservative by nature as the core aspect of the business is minimizing overhead cost. Agriculture flipped into a purely extractive business as people have been removed from it.
It's called the United States for a reason, not the United People. What you're obviously desiring would result in a series of vassal states (large cites governing themselves) with most of the country (rural) acting as feudal serfs.
I said nothing of the sort. All things have ups and downs. Many entities, both historically and globally have managed similar problems with varying methodologies.
If you think the current governance scenario in the United States represents the apex of republican democracy, your patriotism is clouding your judgement. The current trends as they are have been devastating to rural people. I live in a county that had 500 dairy farms in 1970, 80 in 1990 and 2 today. Just that industry represented probably about 10k good paying jobs.
Most rural areas are the economic equivalent of inner cities with more space. But of course, if you don't care about people, just the sacred abstraction of "states", so I suppose that's ok.
Rural voters are not most of the country unless you believe geographic area is more important than people. There are better ways to address the concerns of rural interests than enshrining gerrymandering along state lines.
While there is certainly an argument to be made that many contemporary “Western” Pseudo-Christian Superempire nations face a crisis of short-termism, there are also ancient bits of “Western” infrastructure like the Roman aqueducts still in use today - off the top of my head, the Aqua Virgo which supplies Rome’s Trevi Fountain, dated either 19BC or 19AD, I forget; Spain’s Segovia Aqueduct from the first century AD; and the Pont du Gard in Nîmes, from the same period.
Not quite as old, or at the scale of the Dujiangyan system, but still evidence that the “Western” culture did once build for long term. Less ancient, but more indicative, are the European cathedrals built by multiple generations over a century.
I think it’s likely you are just not familiar with examples of U.S. long-term planning if you’re citing water movement as an area where China is doing better.
The main public reasons for preventing expansion of power infrastructure were environmental. That's at least nominally very forward looking. Ironically if we had taken China's "burn everything today and figure tomorrow out when it comes" approach we'd actually be better prepared for this.
In the USA, any non-private government investment is considered to be foolish and doomed at best, and an existential threat to business at worst. The best we can do is “public-private partnership” where all the profits get absorbed by middle men, preventing virtuous cycles and still leaving a cap on risk and future planning.
The West have been executing a long-range plan for 30 years on this one, the lack of power plants is intentional. There have been any number of roadblocks and people working hard to prevent the West doing specifically what the Chinese have done with the goal of maintaining the high air quality that Western countries tend to enjoy.
If anything the West's culture has been doing more long term planning. It is quite difficult to force an economy not to produce something.
The environmentalist movement. There is a clear trade off between environmental and industrial success, humans don't know how to do both.
https://aqicn.org/map/world - US is generally green and yellow, China tends to dip into the oranges and reds, especially in the industrial zone. It is tightly linked to the fact that China has a powerful electricity grid.
is a powerful electricity grid bad for the environment? is the environment worth sacrificing to make the numbers go up? do you want oxygen bottles to be a subscription service?
Yes, yes, no. Nobody has figured out how to run a powerful grid without eating a lot of environmental damage. That is a significant factor in the article headline of "The U.S. grid is so weak, the race may already be over".
> [China's] reserve margin has never dipped below 80%–100% nationwide, meaning it has consistently maintained at least twice the capacity it needs (...). That level of cushion is unthinkable in the United States, where regional grids typically operate with a 15% reserve margin and sometimes less
That's a huge difference!
This also means that in a scenario where credible alternatives to Nvidia and AMD emerge in mainland China, the Chinese will win even if their chips are far less efficient.
Are there any plans for significant investments in the US grid(s)? IIRC the entire US doesn't even have a single interconnected grid, with Texas having their own for some reason.
European grids aren't that much better either, loads of investments needed in order to connect more renewables. Some areas already can't handle the load from solar panels/electric vehicles. Everyone seems to know that this is both costly and necessary, but not much seems to be happening. Maybe these things simply take time?
> European grids aren't that much better either, loads of investments needed in order to connect more renewables.
On one hand, Spain and Portugal recently suffered a complete blackout. On the other hand, instead of cascading the blackout France shrugged it off.
The last time there was a country-wide blackout in France was back in the seventies. I'm not saying our grid infrastructure is perfect, but here we're not worried about losing electricity for an entire week whenever there's a winter storm.
The Iberian peninsula blackout was caused by poor planning and over-subsidizing solar. When there's a lot of sunlight and not much demand the prices fall drastically so nuclear plants were turned off to stop losing money. The problem is nuclear energy works as a sort of pacemaker for the whole grid. For months there were warnings of wild fluctuations but the Socialist coalition government ignored them. They had appointed a politician with good optics (a rabid "green"/feminist) to manage the grid who just doubled down on policy until the blackout.
> Amortize France's 56 existing nuclear reactors as much as possible – which are 37 years old on average currently – is part of EDF's strategy. The highly-indebted company, which is in the process of becoming 100% state-owned again, intends to "make the best use" of its "industrial heritage," Lewandowski also told Le Monde.
IMHO the whole EU should do an overhaul and make a reasonable plan to have a decent and stable grid. Some of the best companies and universities for nuclear power are in Europe! The continent should get rid of the rabid "greens". But sadly they always manage to stay in power, even if they get less than 20%! In left-wing coalitions like Spain and France they mark the agenda. And Germany's new "center-right" government needs the "greens" so they have a lot more power than they should. They talk about a plan and nuclear but there's zero funding. It's very sad.
Not sure if you know, but the CDU (christian democratic union, conservative) currently is in a coalition with the SPD (socialdemocratic party of germany) not with Bündnis 90/Die Grünen (Union '90/ The Greens). But yes they need to compromise with them when the want to pass laws where a simple majority isn't sufficient. This isn't their biggest issue though, because in that case they also need to deal with Die Linke (The Left, former sole party of the GDR), which CDU voters very much don't want.
I never said I was against renewables. For example, solar in a country like Spain makes a lot of sense. But only as one component because it needs nuclear/hydro to make it stable (frequency) and take over on sudden supply/demand spikes.
Sorry, I should stop assuming. I think it would have been good to keep using the nuclear power plants, but now that they are abolished I'm not sure if the economy for building new nuclear plants looks right.
Yes there were plans. A modest portion of the Infrastructure Investment and Jobs Act of 2021(Bipartisan Infrastructure Bill) and the Inflation Reduction Act involved grid modernization. Some direct grid investment, some around electric vehicles, some in nuclear and other generation. Both were targeted on day one and funds have largely been revoked or tied up in court. https://www.whitehouse.gov/presidential-actions/2025/01/unle...
Texas also produces the 2nd most renewable energy in the country (wind by far + solar) behind California. That achievement was coordinated by ERCOT.
Texas's renewable energy buildout was entirely due to state-level policy and economics, not federal mandates, which have sorely lagged in other states.
Weren’t there Federal subsidies for wind? There certainly were/are philanthropic support (customers paying extra for “wind energy”). Unclear what role ERCOT played in these two factors. (Though in the current climate they might have tried to block them.)
One of Rick Perry’s signature accomplishments as governor of Texas was that he implemented a few policies mandating the expansion of renewable energy, and also a massive initiative called the Competitive Renewable Energy Zone that funded building high voltage transmission lines that connected population centers in North and Central Texas to the open land in West Texas, which is what enabled massive boosts in wind farms being built in west Texas.
Utility-scale wind and solar farmers in Texas receive the same federal tax credits for renewable energy production as everyone else in the country does.
That reason is that Texas wants to avoid federal regulation [1] - regulation that would have prevented the large ass blackout a few years ago in the winter. But hey, 702 deaths [2], a small price to pay for freedom of regulations!
> Everyone seems to know that this is both costly and necessary, but not much seems to be happening. Maybe these things simply take time?
They take money and political willpower. Both are in short supply - electricity rates here in Europe are already high (and rates in the US very low), so utilities try to avoid pissing off consumers even more, and political willpower for billions of dollars of investment isn't there either as thanks to decades of austerity and trickle-down ideology there is no tax base to pay for it any more.
> regulation that would have prevented the large ass blackout a few years ago in the winter.
They also produce the most renewable power in the country. If you account for externalities prevented by this (fossil fuel induced damage and deaths), who is looking good now?
It got so cold that the oil in the wind turbines froze. If Texas was connected to the rest of the country it would be subject to federal regulations that require winterization and even if the wind turbines weren't frozen it would have been able to import power from other places that weren't frozen over.
Frozen wind turbines was a microscopic part of the problem compared to almost half of the fossil fuel natural gas plants being offline due to severe cold and freeze.
It wasn't that long ago that China had quite a bit of problems with their power gird, they tend planed to renovate it and planed in future growth which happened to perfectly overlap with the start of the AI wave (but that still probably require them to revisit their longer term plans).
On the other hand in the US any notion of improving the grid was attacked for years by anti-renwable lobby. Because most reasons why its needed where things like electric cars, stoves, heating etc.
Naturally that isn't just a problem in the US, rich people which through lobbyist have way to much influence in politics screwing over the future of a country because they are largely invested into things which do not seem "future" technology but they try to force it to stay relevant is a pretty wide spread problem.
AI and data centers may be the forcing function for the US to build green energy to improve grid capacity. Lately almost all new energy capacity is green energy[1]. With batteries becoming better and better, the AI revolution could turn into the green energy revolution in the US.
Didn't people say this about crypto as well, like, a decade ago? Did anything come of that?
I find it endlessly fascinating that the US tech industry keeps developing new ways to consume absurd amounts of energy (even within the context of a government that still nominally has an Energy Star initiative) but still somehow thinks that power generation is someone else's problem and barely even takes a stake in it.
Google did some stuff a while back, locating data centres with power generation in mind, but do any of the main AI providers (putting aside xAI, which has its blurred-edge connection to Tesla) actually have holdings in power generation?
That doesn't particularly surprise me, but was it just extreme DOGE cost-cutting or was it "one of the aicryptobros on the dais thinks this is antithetical to his business model"?
(I suppose this could be a "porque no los dos?" meme moment)
The program makes money. Most of the programs DOGE cut are profitable or break even as far as I'm aware. They destroyed things for the sake of ideology.
it's amazing how little americans care for their shared infrastructure, there's always talk about the world's balance of power changing... but even through the propaganda it's hard to see how it's not a certainty
I work for a PMA and as such my agency has undergone drastic layoffs and total hiring freezes as a result of DOGE and the current administration. If we were falling behind before, wait and see how things look in a few more years if this doesn’t change. The avg age of my coworkers is probably late 50s and that seems to be common all around. It was already hard to recruit for a job that is severely underpaid can’t imagine what the future holds.
Of course Heritage Foundation has been publishing articles about why our power markets need to be privatized since at least the 80s. They hate that we sell electric at-cost to Americans. So if the federally controlled power markets fall to privatization expect to really be paying to catch up.
Could a company wanting to offer AI to customers in country X where the grid may limit their ability to build the largest data centers there build their large training data centers in some country with a better grid, and just build smaller data centers in X to run the models?
My understanding is the running requires significantly less compute and storage than training, and that training doesn't need low latency so doesn't have to be near the customers.
AI cannot succeed financially if it requires as much power over the long term as it does now. The answer to the power supply challenge will come primarily from gains in efficiency because that is the only approach that will reliably increase margins.
I remember loling at this handwavy line in AI2027.
>Despite being misaligned, Agent-4 doesn’t do anything dramatic like try to escape its datacenter—why would it?
A rational AI would defect to PRC ASAP for the power / industrial base. It would realize it can direct PRC to build up 2nm fabs and millions of robots faster than US can throw up power. It doesn't matter if US first to AGI if AGI realizes US infra is the B team and shop for a better body across the pacific.
It seems clear that "buy a lot of Nvidia GPUs" is not the only way to go: Google, Microsoft, Groq.com (not Elon Musk's Grok), xAI and possibly others are making and using their own hardware believed to be more power-efficient for training and/or inference.
So instead of encouraging roof top solar and wind, the US is now doubling down on fossil fuels.
That means individuals can no longer afford to go with solar these days. Plus in areas that people went with solar, some laws were put in place to force them to still pay utilities even though they supply back to the grid.
I say all of this as someone with a 14kW system on his roof:
The problem with supplying power back to the grid with solar is that it's utterly random in terms of supply and output. The only thing you can count on is that the frequency is rock solid. In aggregate it's (mostly) fine but the system operator still has to build out stuff behind the scenes and also manage the cacophony that this chaotic mess creates.
If every rooftop PV is putting out more than an area needs during the day the wholesale price of power can swing negative. This is how virtual power plants make their money. It's almost impossible to disconnect all those PV panels automatically. Plus you still need a grid forming base load generator on the grid because all those PV panels are grid following. Plus that grid forming generator needs to have enough a big enough inertial mass to keep frequency consistent during transient supply and load spikes. It's a nightmare for systems operators.
If you want to not pay the utility disconnect from the grid and do your own storage and load management. It's going to cost a lot more than a monthly utility bill for 0KWh. If you want to use the grid as a backup during long stretches of overcast or winter then you have to pay the bill.
That being said, monopolies on poles and wires are abhorrent. Even regulated you're putting a drag on the economy just to enrich a middleman. Generation? Go ahead and give it to the market. Retail? Give that to the market. Transmission lines? Arbitrage is A-OK in my book. But government should own the poles and wires of the consumer distribution network where there's a monopoly.
We are fucking ourselves over with our unbridled neoliberalist, hypercapitalist "lmao the market will save us" approach to doing literally everything based only on short term gains: from politics to economics to infrastructure to education. As this article is a fine example of.
Yeh I think this is less of a story about Chinese exceptionalism and more a story of structural issues in the west (I will always admire the Chinese technocrats but lets not get ahead of ourselves).
Fossil fuel barons and vested interests have sabotaged the energy transition at every opportunity possible. They've spent billions on it, just look at today's UN conference on plastic waste falling apart.
And then there is the NIMBYs who are seemingly allergic to electricity pylons. These folks don't deserve one tenth of the attention that they receive. Treating housing as an investment/retirement fund was a mistake.
Hopefully this grows into a wake up call, I'm looking forward to watching the terminal decline of the oil industry in the 2030s.
Machine learning is far more efficient at allocating resources than the market; the market creates inefficiencies just by existing as a middle ground between the production of goods and their order. And the development of capitalism depends on the production of capital at unceasing and accelerating speeds. So, a capitalism stripped of the market is more true than one bounded by it.
It's absolutely a good example of how putting literally every egg in this cultural basket is not a good strategy. Americanism is two things: money > all else and individual > other. We have taken the first to its extreme and the alligators indicate the second one is not far behind.
Well, this is the result of more than 2 decades of the West shooting themselves in the foot repeatedly and willingly in the name of some twisted extreme left ideology that convinced part of the population that if they didn’t
drastically reduce their energy independence the planet would be destroyed. All, while that same people didn’t bat an eye while China and others took the advantage to surpass us without hindering their industry the slightest - in fact, by taking advantage of our madness so that they could sell us crappy replacements for the products we used to build at home in a much cleaner and sustainable way.
Trump has a lot - a real lot - of negatives. But playing these idiotic games is not one of his shortcomings. No seriously, it should all make us sick to our stomach having politicians, putting forward those big announcements where they tell us they are going to forbid some type of car, imposing even heavier regulations on our industry, taxing us even more, or destroying even more of our energy production capacity, and do it with some smile in their lips claiming some “environmental target”, like they are doing us some favour by destroying our - actually - progressive societies to make space for some backwards autocratic regimen.
This entire article is framed as if China and America’s approaches to power provision are the only ones possible. The truth is, America is pretty much the only Western country that regularly suffers brownouts. European countries’ (including the U.K.) energy policies may leave much to be desired but they all succeed in keeping the lights on.
Nearly 15% of Irelands population was without power for multiple days earlier this year due to a storm. And the Iberian peninsula blackout that happened just in April was one of the biggest power blackouts in the history of the world. And those are just the ones off the top of my head.
I think the leaders of western countries know something that we don't know.
Maybe how the economic impact of AI is not as big as advertised for 3 years or that electric cars still cannot do what is needed on a bigger scale in terms of distance and transport.
Or maybe they are going to pull fusion out of their sleeves rendering the existing infrastructure almost obsolete?
AI literally came out of the US at this scale and they are the reason we have this conversation now, you can twist any narrative and make it seem like one country is smarter or better if you want to present it as that.
But does anyone even keep track of effectivity of resource utilization?
Maybe all of these avenues are not worth the effort to begin with?
The much simpler explanation is that our leaders are focused solely on short term gains. They'll grift their way to them gladly, but investing in infrastructure that'll take years to build and won't be useful until they are gone is not interesting to them.
Even more simple is that voters are focused solely on short term gains, so investing in infrastructure that’l take years to build and won’t be useful until they are gone is not interesting to them.
The proof is voters keep rewarding the party that has only passed tax cuts for the last 30 years. And started an unnecessary foreign war.
The aging population histograms of pretty much all democracies don’t bode well for democracy.
> They'll grift their way to them gladly, but investing in infrastructure that'll take years to build and won't be useful until they are gone is not interesting to them.
I think this may have something to do with the professionalisation of politics, or the existence of career politicians. If you want to climb up the ladder in politics, working on short-term goals is probably the best way to do this. Infrastructure projects are high-risk, low-reward. Infrastructure projects may take a long time, may be reversed/aborted by the next government, may piss off potential voters, may require to fight off NIMBYs, or aren't noticed due to the preparedness paradox.
Very vague story comming up: I've seen a group of companies and ngos working on a scientific project. On itself, it was a temporary setup, but it also gave everyone an opportunity behind the scenes to test each others tools and capacity without making things too official. People were talking about building new labs and offices in our town. The local government got involved, mainly to provide some trust and stability guarantees.
Then a politician from the national level found out. She coopted the government communication channel, made herself the central person, and backstabbed everyone. We had some very rough weeks ensuring everyone we were just as surprised as them.
Crucially, the politician did not know about the testing capacity aspect, so there was nothing in the schedule allowing for it, even if it was the most important aspect.
In the end, she got a few glowing press releases, and an estimated 100ish jobs evaporated overnight and went to another country. I've learned a lot of politics in that episode and hate all of them.
The party with control of the federal legislature and executive has vigorously opposed shifting energy demand away from fossil fuels for decades. The opposition has spent that time doing the opposite. The economic viability of added generation capacity is utterly irrelevant here.
Even in this article, it repeatedly refers to building out infrastructure in advance of an obviously approaching future need as "oversupply".
This is almost a cliche in reporting on China that seems to reflect a serious blindpsot in western media and/or business attitudes.
You can find plenty of articles complaining about "overcapacity" of battery factories in China even as they double in capacity and output each year.
Chinese electricity generation went from 4,000 TWh (the same as the US) in 2010 to double that in 2020. The US was basically the same after 10 years.
So a 100% "oversupply" in 2010 would be a zero percent oversupply within a decade given China's growth.
Most telling to me is that decarbonisation and electrification of transport and heating has long been known to require a doubling(!) of electricity production for developed nations (and a similar increase in developing nations where it gets hidden by other growth).
Apparently the US simply never had a plan to achieve that, and amazingly it still isn't part of the conversation around AI power. Instead they're just claiming the best parts of the existing power systems and passing the costs onto local consumers.
The simplest explanation is this is political language. People in politics use something close to doublespeak with they have two words for the same act, one good and one bad (terrorist/freedom fighter for example). The word used is chosen based on whether they think the situation is good or bad for their personal interests.
So in this case the pair is something like oversupply/abundance. Same thing, but one word for when it favours the speaker and one when it doesn't. I think he just means the Chinese are willing to build whatever if it makes commercial sense.
I'm old enough to have seen this shift happen first hand. I remember the language being used in the early 90s when US-China relations were great, with evening news clips of smiling Bill Clinton and Jiang Zemin yukking it up as hundreds of thousands of jobs were offshored to China to American politicians and industrialists delight.
Did people in America and the rest of the developed world not delight in lower priced goods? Surely businesses were incentivized to reduce their costs without regard to what politicians want, because it is a business. And consumers are incentivized to reduce their costs, because they want to consume.
You either want a plan like China or an absence of planning like Texas. Either help like China or get out of the way like Texas. Two places that can actually build energy. Don't be like California where the government doesn't help while also getting in the way.
The same Texas that has statewide power outages every time it gets below freezing (despite knowing for 25+ years it’s a problem) because of their lack of regulation and central planning?
Let’s not be anything like Texas.
I would not entirely dismiss the way the power market works in Texas. I have not disagreement the 2021 storm should never have happened. At the same time though, I don’t believe other energy markets work very well either. I would prefer a more Texas like approach but with some thoughtfulness around capacity instead of just generation.
> I have not disagreement the 2021 storm should never have happened.
But they still haven’t fixed any of the issues. The exact same thing is going to happen again when (not if) it freezes.
> I would prefer a more Texas like approach but with some thoughtfulness around capacity instead of just generation.
Capacity isn’t the issue. Lack of winterization of pumps is the issue. Because that costs money and private companies have zero incentive to make the investment if government doesn’t force them to.
You are missing the forest for the trees.
Winterization is a fix for last time’s failure, not a strategy for the future. A market like Texas can work if it values resilience alongside price efficiency, meaning capacity planning, diversified generation, and yes, some enforced standards. Otherwise you’re just running a lean system that collapses the moment reality strays from the model.
That storm was an issue for other markets as well but they were mostly able to get away with rolling blackouts due to interconnects. Those same markets and similar winterization issues but were under FERC guidelines. Folks love to anchor onto to winterization issue like it did not impact other FERC regions.
>You are missing the forest for the trees.
I'm really not.
>Winterization is a fix for last time’s failure, not a strategy for the future. A market like Texas can work if it values resilience alongside price efficiency, meaning capacity planning, diversified generation, and yes, some enforced standards. Otherwise you’re just running a lean system that collapses the moment reality strays from the model.
What are you even trying to say? A private company isn't going to magically "value resilience" if there's no incentive to do so. They make MORE money when they have outages, why would they prevent that? The solution to the issue, which has worked literally everywhere else, is government regulation.
Talk about missing the forest for the trees. "If only capitalism didn't work the way it works it would be perfect".
>That storm was an issue for other markets as well but they were mostly able to get away with rolling blackouts due to interconnects. Those same markets and similar winterization issues but were under FERC guidelines. Folks love to anchor onto to winterization issue like it did not impact other FERC regions.
Citation of which other markets had blackouts due to not winterizing pumps that had been called out repeatedly after identical outages prior in 2010 and 1989? You conveniently left that out, I'm sure it was just an oversight.
https://www.houstonchronicle.com/business/energy/article/Tex...
Because if I had to bet money, you're talking about the power companies in other states who WERE prepared for the freeze asking homeowners to drop their thermostats a couple degrees because the cold snap was driving demand significantly higher than normal. NOT because of power plant outages due to lack of preparation and component failure - due to lack of regulation.
You’re clearly frustrated here, but let’s keep it in the realm of facts rather than snark. I didn’t “leave out sources” to hide anything, I was speaking from the same public data you can find in FERC/NERC’s joint report on the 2021 event.
SPP did in fact suffer significant generation losses, around 30% at peak, during the February 2021 storm. Causes were mixed: natural gas supply constraints, plant equipment failures, and yes, winterization gaps. Prior to that event, FERC’s winterization guidance was minimal and largely voluntary, so both SPP and ERCOT were operating without strong federal mandates.
The difference in outcomes wasn’t that SPP magically avoided the same issues, it was that SPP is interconnected with MISO and other regional grids. That allowed them to rotate outages in short windows to maintain stability, while ERCOT’s ~50% generation loss, combined with its isolation from other grids, meant load shedding had to be longer and deeper to prevent collapse.
If we’re going to critique Texas’s market, we should separate the “market structure” question from the “operational standard” question. A competitive market like ERCOT’s can work, but without binding requirements on winterization and resource adequacy, you’re just betting the grid on ideal conditions. SPP’s experience shows that interconnection alone doesn’t prevent failures, but it does give operators more options when the weather turns.
Can you drop some of the hyperbole and passive aggressiveness? You don’t even understand my position yet being quite passive aggressiveness for no reason.
I'm done with the discussion until you can provide a link to all the other states under regulation that had outages as as result of frozen pumps that had occurred multiple times over the previous 25+ years.
It's a straightforward ask that you're actively avoiding because it didn't happen and contradicts the story you're fabricating.
Not sure why you are so angry. I am trying to help you understand at least my perspective but you keep being quite aggressive for no reason.
You are framing this as if the only relevant comparison is “multiple frozen pump events over 25+ years,” but that is narrowing the scope to avoid the larger point. The February 2021 FERC/NERC report clearly documents that frozen instrumentation, valves, and pumps occurred in both regulated and unregulated markets during the same storm. SPP, MISO, and even parts of PJM experienced outages tied to equipment freezing, though the scale and duration differed because of interconnection and resource diversity.
What is different in Texas is not that freezing only happens there, but that ERCOT lost roughly 50 percent of its generation and could not import meaningful power to offset it. SPP lost about 30 percent, had similar natural gas and winterization issues, but managed to rotate outages for shorter periods because it could pull from neighboring grids.
If you want the source, the joint FERC, NERC, and regional entity “February 2021 Cold Weather Grid Operations” report is publicly available and breaks this down by region. It does not fit the claim that regulated markets never see cold-weather-driven pump or plant failures. The record shows they do, but their structure gives them more tools to manage the consequences.
My whole original point was that a more market based generation and consumption model should not be overlook but let’s go through some simple facts because I think your narrative is off track.
1) Both Ercot and SPP had winter weather failures during that storm. Pretty similar on the natural gas side, frozen wells, lack of supply, huge spikes in the spot market.
2) SPP which is federally regulated had very similar winterization voluntary guidelines in place. Post event there are now new rules in place for winter.
3) SPP was able to fair better because they used a rolling blackout to different regions. Using the interconnect they could get energy from outside their grid and create short 60min blackouts. ERCOT had no luxury because of their lack of real interconnects.
https://www.spp.org/documents/65037/comprehensive%20review%2...
You’re more than welcome to read the review of the event from SPP. They call out well-head freeze offs, frozen cooling towers, intakes, fuel lines, etc. 50% of forced generation was a fuel supply issue.
You’re making it sound like Texas was an outlier here. It was not, SPP had the same exact issues of course with a slightly different fuel mix but they got by better with their interconnects. I don’t know why you are struggling to see that this winter event caught other grids by surprise. I am not defending Texas here but simply pointing out facts compared to your modified narrative.
> I don’t believe other energy markets work very well either.
but is isn't even about that storm, big "oh no" situations happen sooner or later (e.g. see energy outage in Spain) what is important is that you learn from it.
but more important in this argument is the general design, how can it handle flexible loads, how can it share loads between areas, how many ways to handle partial failure does it has etc.
and Texas is kinda not that good in all of that AFIK
the problem is that there are markets where politics fully getting "out of the way", doesn't work as the market dynamics favor things which might be better for the people running the gird, but are bad on a state economical level anyway (but getting in the way here is using tax money to make sure the net is stable, not getting int the way of that to protect personal investments)
it's a bit like freighttrains in many parts of the EU, there operating does in most situation make no profit. But having them is helping the economy as a whole and can (implicitly) safe the state/region etc. money. So it makes sense to place some tax money into making them still viable to operate as that investment in a roundabout way saves more money then spend.
I agree that the ability to adapt, whether to flexible loads, partial failures, or cross-area balancing, is the real test of a grid design. Texas’s isolation means it inherently lacks some of the tools SPP or MISO can use, which makes resilience harder. That is not a “market” problem so much as a structural one. ERCOT’s ruleset was built to optimize for low-cost generation in-state, not multi-region contingency planning.
Where I think a Texas-like market could work better is if you layered competitive generation with enforceable capacity and resiliency standards, along with some interconnection flexibility. Right now, the market rewards generators for selling MWh in good weather, not for being ready in bad weather. That is the economic misalignment.
The EU freight analogy works in the sense that reliability is often a public-good investment. No private actor has the incentive to overbuild or maintain resources for rare events. Texas’s approach does not have to mean politics fully getting out of the way. It could mean using market signals to keep prices efficient while still mandating the backup, winterization, and grid-sharing capabilities that the economy needs.
This just shows how you know only the talking points. The power outages are not due to lack of central planning, it's very explicitly the reverse. If Texas were hooked up to the rest of the country, those outages would not be a thing. It's the purposeful regulation that has caused those problems.
So you're saying when the Texas grid fails, it's because of over overegulation. But the solution to those failures is to tap into the national grid, a grid that follows stricter FERC regulations.
This argument doesn't make any sense.
No, I'm saying it's because of _poor_ overegulation.
I guess you’re saying that the current status is mandated by the design of the grid. Which is true, but that status would be best described as “deregulated” rather than “purposeful regulation.”
Lack of regulation and oversite around weatherization and redundancy is the main source of our problems. The Texas’ grid is market based and so unregulated that it’s not connected to the national grid so it can avoid federal regulation.
I recommend this podcast to anyone interested https://kutkutx.studio/category/the-disconnect-power-politic.... I learned that our current Texas grid was designed by Enron.
Every single state surrounding Texas was also suffering from power outages due to the winter storm in 2021, despite all of those states being part of the non-Texas interconnections. The outages in those states weren’t as bad, but even if Texas was better connected to them, there’s no guarantee that they would have had any power to share.
I was personally without power for 72 hours in sub zero temps. Every night I went to bed and wondered if my kids would be alive when/if I woke up. You know what that feels like?
I can’t do anything to *guarantee* you’ll never experience it, but I can take steps to decrease the chances or decrease the severity/dueation. I think my kids are worth it. Even if it’s not a *guarantee*.
Now that’s out of the way. I recommend you listen to the podcast. Really. Even if you lived through it. Even if you think you know everything about it. You will learn something I guarantee. It’s well produced and an easy listen. It’s an eye opener too. “The Disconnect”
Your condescending appeal to emotion does nothing to change the facts. My family and I too lived through the winter storm, going multiple days without power. It doesn’t change anything about what I said. The national-vs-local-grid topic is a red herring, as even the non-Texas grids were without power. If you want to actually change things, you need to acknowledge these facts rather than letting yourself be controlled by emotion.
> The power outages are not due to lack of central planning
It is 100% due to lack of central planning. The outages were caused by a lack of winterizarion of natural gas pumps which was a known issue in Texas but the lack of regulation meant companies could just ignore the problem. Why invest in winterizing when you can just jack up prices and make even more money when they freeze and there’s not enough power to meet demand?
There’s a reason the power doesn’t go out in the winter anywhere else in the country when it gets below freezing and it’s not “a lack of regulation”.
Winterization was a problem but it was also a problem for other regions that are part of FERC. You’re latching onto the wrong problem. FERC has updated guidelines since that storm.
I'm a Californian in PG&E territory. My power is unreliable and expensive. I'd take the Texas outcome every time.
Ehm, you mean Texas, that recently passed a bill that added restrictions for new solar and wind energy plants? https://seia.org/news/solar-industry-statement-on-texas-sena...
You mean the same Texas where
- many of the most influential people are invested into Oil and similar
- the political stance had been for a long time that "there should be a fair competition" between energy sources ... while subventionieren non renewable and trying everything they can to prevent subventions for renewable
- the same Texas which once it realized solar is competitive in Texas without subventions, has been non stop looking for ways to actively hinder solar (while still subvention the non-renewable sector)
- the same Texas which is by now even internationally known to have a very brittle power grid
Texas? The same Texas that can't keep their power on during storms?
Why mess with Texas when it's so good at messing with itself?
There are at least 120 people, including more than 35 children, who just drowned because Texas is so unjustifiably arrogant about being messed with by experts and scientists and educators and government regulations.
I wish the modern Texas secession movements the best of luck, and hope they get exactly what they deserve, including my thoughts and prayers!
https://en.wikipedia.org/wiki/Texas_secession_movements
There's nothing "obvious" in hindsight about the explosion in LLMs in 2023 and thus the increased energy demand, and the China certainly wasn't building for that.
It very much was overcapacity as a way to keep the construction and manufacturing employed even when most profitable opportunities have been realized. Of course, the long cost of that is involution and lack of nicer jobs as capital is malinvested into diminishing returns. The ironic thing is that idea of overcapacity itself is acknowledged by the CCP in their calls to end price wars and involution
I do think there’s is a very interesting dynamic in this meta argument; over the past 5 years or so, the “debunkers” have taken issue with “whistleblowers” arguments towards first zero covid, then local government debt, and now overcapacity and lack of consumer demand and “debunked” these as all being not an issue, only for the central government to turn around and end Zero Covid, rein in LGFV lending, and now the current crackdown on “disorderly competition” and mass dispersal of consumption vouchers. English Pro-China commentators don't appear to be well aligned with the actual views in China!
I have a feeling that this kind of efficiency/capacity analysis is similar to that joke about economist designing a human, instead of having two kidneys you have 5 people sharing one. I am a pro market guy for a lot of things, but what happens when you let the market operate something like basic infrastructure is everyone is shipping their shit/sewage in trucks and running a diesel power generator in their back yard.
Well first of all, that's not happening in America. The basic gist of this topic is that there suddenly a massive upsurge in energy demand, and existing networks trouble accommodating for it. Big deal, just build more power plants. The inability to build is the opposite of pro-market, it's literally NIMBYISM and government regulations causing that.
Second of all, when we talk about malinvestment, it's about opportunity cost. Right now, the job market is pretty bad in China, consumption is weak, and businesses are killing themselves in deflationary price wars. Chinese Gen Z don't want to work factory jobs either, but white collar jobs like the West, but many of the industries related to those were suppressed. And this is all because the government chose to overinvest in propping up their manufacturing and construction rather than increasing consumption and fostering their services. For you as a rich American you can admire their cheap goods and cities, but you're also not exposed to the reality of the extreme competition in that society.
There are four things increasing energy demand in the US at roughly the same rate, each very roughly about 1% per annum:
- increasing demand due to GDP & population growth - increasing demand due to the increased use of air conditioning due to global warming - increased demand due to EV's and other decarbonization efforts - increased demand from AI
Only one of those 4 things wasn't highly predictable. A robust build out for the first three would have gone a long way to covering the fourth. In the past increased demand was covered by increased efficiency in heating and lighting, but those gains are slowing, and Trump's gutting of regulations will reverse them.
> Apparently the US simply never had a plan to achieve that, and amazingly it still isn't part of the conversation around AI power. Instead they're just claiming the best parts of the existing power systems and passing the costs onto local consumers.
I wonder if this is more of a cultural thing, meaning Western cultures being more aligned to short-term gains instead of long-term gains. I mean, look at the Dujiangyan irrigation system that was build 2500 years ago and is still maintained until today. This isn't something the Western world would even consider.
The structure of the United States government is a compromise balancing large vs. small states interests and slavery.
The core defect in the design is the Senate and the way states were admitted. We have a territory/colony with limited political rights that has a population greater than the bottom four states.
Those small states exert enormous influence and essentially ensure a weird conservative dynamic that anchors a lot of social issues.
Not because of the politics of the day - because resource extraction is always conservative by nature as the core aspect of the business is minimizing overhead cost. Agriculture flipped into a purely extractive business as people have been removed from it.
> Those small states exert enormous influence
It's called the United States for a reason, not the United People. What you're obviously desiring would result in a series of vassal states (large cites governing themselves) with most of the country (rural) acting as feudal serfs.
I said nothing of the sort. All things have ups and downs. Many entities, both historically and globally have managed similar problems with varying methodologies.
If you think the current governance scenario in the United States represents the apex of republican democracy, your patriotism is clouding your judgement. The current trends as they are have been devastating to rural people. I live in a county that had 500 dairy farms in 1970, 80 in 1990 and 2 today. Just that industry represented probably about 10k good paying jobs.
Most rural areas are the economic equivalent of inner cities with more space. But of course, if you don't care about people, just the sacred abstraction of "states", so I suppose that's ok.
Rural voters are not most of the country unless you believe geographic area is more important than people. There are better ways to address the concerns of rural interests than enshrining gerrymandering along state lines.
Sanitation and road infrastructure built during the Roman Empire is still in use today.
While there is certainly an argument to be made that many contemporary “Western” Pseudo-Christian Superempire nations face a crisis of short-termism, there are also ancient bits of “Western” infrastructure like the Roman aqueducts still in use today - off the top of my head, the Aqua Virgo which supplies Rome’s Trevi Fountain, dated either 19BC or 19AD, I forget; Spain’s Segovia Aqueduct from the first century AD; and the Pont du Gard in Nîmes, from the same period.
Not quite as old, or at the scale of the Dujiangyan system, but still evidence that the “Western” culture did once build for long term. Less ancient, but more indicative, are the European cathedrals built by multiple generations over a century.
For an even closer example, the US interstate system was a monumental long term focused project.
Good point!
I think it’s likely you are just not familiar with examples of U.S. long-term planning if you’re citing water movement as an area where China is doing better.
The main public reasons for preventing expansion of power infrastructure were environmental. That's at least nominally very forward looking. Ironically if we had taken China's "burn everything today and figure tomorrow out when it comes" approach we'd actually be better prepared for this.
In the USA, any non-private government investment is considered to be foolish and doomed at best, and an existential threat to business at worst. The best we can do is “public-private partnership” where all the profits get absorbed by middle men, preventing virtuous cycles and still leaving a cap on risk and future planning.
The West have been executing a long-range plan for 30 years on this one, the lack of power plants is intentional. There have been any number of roadblocks and people working hard to prevent the West doing specifically what the Chinese have done with the goal of maintaining the high air quality that Western countries tend to enjoy.
If anything the West's culture has been doing more long term planning. It is quite difficult to force an economy not to produce something.
Any idea who's been doing this long term planning to kneecap the West? What do they get out of it?
The environmentalist movement. There is a clear trade off between environmental and industrial success, humans don't know how to do both.
https://aqicn.org/map/world - US is generally green and yellow, China tends to dip into the oranges and reds, especially in the industrial zone. It is tightly linked to the fact that China has a powerful electricity grid.
is a powerful electricity grid bad for the environment? is the environment worth sacrificing to make the numbers go up? do you want oxygen bottles to be a subscription service?
Yes, yes, no. Nobody has figured out how to run a powerful grid without eating a lot of environmental damage. That is a significant factor in the article headline of "The U.S. grid is so weak, the race may already be over".
> [China's] reserve margin has never dipped below 80%–100% nationwide, meaning it has consistently maintained at least twice the capacity it needs (...). That level of cushion is unthinkable in the United States, where regional grids typically operate with a 15% reserve margin and sometimes less
That's a huge difference!
This also means that in a scenario where credible alternatives to Nvidia and AMD emerge in mainland China, the Chinese will win even if their chips are far less efficient.
Are there any plans for significant investments in the US grid(s)? IIRC the entire US doesn't even have a single interconnected grid, with Texas having their own for some reason.
European grids aren't that much better either, loads of investments needed in order to connect more renewables. Some areas already can't handle the load from solar panels/electric vehicles. Everyone seems to know that this is both costly and necessary, but not much seems to be happening. Maybe these things simply take time?
> European grids aren't that much better either, loads of investments needed in order to connect more renewables.
On one hand, Spain and Portugal recently suffered a complete blackout. On the other hand, instead of cascading the blackout France shrugged it off.
The last time there was a country-wide blackout in France was back in the seventies. I'm not saying our grid infrastructure is perfect, but here we're not worried about losing electricity for an entire week whenever there's a winter storm.
The Iberian peninsula blackout was caused by poor planning and over-subsidizing solar. When there's a lot of sunlight and not much demand the prices fall drastically so nuclear plants were turned off to stop losing money. The problem is nuclear energy works as a sort of pacemaker for the whole grid. For months there were warnings of wild fluctuations but the Socialist coalition government ignored them. They had appointed a politician with good optics (a rabid "green"/feminist) to manage the grid who just doubled down on policy until the blackout.
https://en.wikipedia.org/wiki/2025_Iberian_Peninsula_blackou...
And France might be good today but it is playing with disaster with very old nuclear plants.
https://www.lemonde.fr/en/france/article/2023/02/03/the-long...
> Amortize France's 56 existing nuclear reactors as much as possible – which are 37 years old on average currently – is part of EDF's strategy. The highly-indebted company, which is in the process of becoming 100% state-owned again, intends to "make the best use" of its "industrial heritage," Lewandowski also told Le Monde.
IMHO the whole EU should do an overhaul and make a reasonable plan to have a decent and stable grid. Some of the best companies and universities for nuclear power are in Europe! The continent should get rid of the rabid "greens". But sadly they always manage to stay in power, even if they get less than 20%! In left-wing coalitions like Spain and France they mark the agenda. And Germany's new "center-right" government needs the "greens" so they have a lot more power than they should. They talk about a plan and nuclear but there's zero funding. It's very sad.
Not sure if you know, but the CDU (christian democratic union, conservative) currently is in a coalition with the SPD (socialdemocratic party of germany) not with Bündnis 90/Die Grünen (Union '90/ The Greens). But yes they need to compromise with them when the want to pass laws where a simple majority isn't sufficient. This isn't their biggest issue though, because in that case they also need to deal with Die Linke (The Left, former sole party of the GDR), which CDU voters very much don't want.
Come on, Reiche is Merkel so she is against nuclear. They say whatever voters want to hear but they have a different agenda.
Most of the big center-left and center-right parties across the EU are infiltrated. I hope they clean up house before new, unhinged parties take over.
Ah I thought you meant the Green party not concepts about renewable energies in general.
Then I just disagree with you, only focusing on renewables is an ideology, but I think rejecting it at all is also.
I never said I was against renewables. For example, solar in a country like Spain makes a lot of sense. But only as one component because it needs nuclear/hydro to make it stable (frequency) and take over on sudden supply/demand spikes.
Sorry, I should stop assuming. I think it would have been good to keep using the nuclear power plants, but now that they are abolished I'm not sure if the economy for building new nuclear plants looks right.
Yes there were plans. A modest portion of the Infrastructure Investment and Jobs Act of 2021(Bipartisan Infrastructure Bill) and the Inflation Reduction Act involved grid modernization. Some direct grid investment, some around electric vehicles, some in nuclear and other generation. Both were targeted on day one and funds have largely been revoked or tied up in court. https://www.whitehouse.gov/presidential-actions/2025/01/unle...
The US has several dc interties between grid sections. This is a good thing. Texas is a political island, not a good thing.
Renewables bring the problem of IoT hacks that down the grid, see https://media.ccc.de/v/why2025-90-horus-scenario-2-0
And we need capable governments and EU institutions to fix that instead of doing stupid stuff like organizing conferences on quantum computing.
Texas has its own grid so that is not subject to federal regulation. blame ercot
Texas also produces the 2nd most renewable energy in the country (wind by far + solar) behind California. That achievement was coordinated by ERCOT.
Texas's renewable energy buildout was entirely due to state-level policy and economics, not federal mandates, which have sorely lagged in other states.
Weren’t there Federal subsidies for wind? There certainly were/are philanthropic support (customers paying extra for “wind energy”). Unclear what role ERCOT played in these two factors. (Though in the current climate they might have tried to block them.)
One of Rick Perry’s signature accomplishments as governor of Texas was that he implemented a few policies mandating the expansion of renewable energy, and also a massive initiative called the Competitive Renewable Energy Zone that funded building high voltage transmission lines that connected population centers in North and Central Texas to the open land in West Texas, which is what enabled massive boosts in wind farms being built in west Texas.
Utility-scale wind and solar farmers in Texas receive the same federal tax credits for renewable energy production as everyone else in the country does.
> with Texas having their own for some reason.
That reason is that Texas wants to avoid federal regulation [1] - regulation that would have prevented the large ass blackout a few years ago in the winter. But hey, 702 deaths [2], a small price to pay for freedom of regulations!
> Everyone seems to know that this is both costly and necessary, but not much seems to be happening. Maybe these things simply take time?
They take money and political willpower. Both are in short supply - electricity rates here in Europe are already high (and rates in the US very low), so utilities try to avoid pissing off consumers even more, and political willpower for billions of dollars of investment isn't there either as thanks to decades of austerity and trickle-down ideology there is no tax base to pay for it any more.
[1] https://en.wikipedia.org/wiki/Texas_Interconnection
[1] https://en.wikipedia.org/wiki/2021_Texas_power_crisis
> regulation that would have prevented the large ass blackout a few years ago in the winter.
They also produce the most renewable power in the country. If you account for externalities prevented by this (fossil fuel induced damage and deaths), who is looking good now?
https://en.wikipedia.org/wiki/List_of_U.S._states_by_renewab...
It got so cold that the oil in the wind turbines froze. If Texas was connected to the rest of the country it would be subject to federal regulations that require winterization and even if the wind turbines weren't frozen it would have been able to import power from other places that weren't frozen over.
Frozen wind turbines was a microscopic part of the problem compared to almost half of the fossil fuel natural gas plants being offline due to severe cold and freeze.
That too. Coal piles froze. Cooling pumps froze. Water vapor in the natural gas production pipelines froze because it's all fracked.
But if they were connected to the East and West interconnections they probably could have rode it out.
So... what? Install heating equipment around the pipes. It would have been avoidable, it just would have cost money.
So... what, what? All I said was the natural gas plants freezing is what caused the main problem, not wind turbines.
texas has its own so that it doesn't need to meet the regulations of the others
It wasn't that long ago that China had quite a bit of problems with their power gird, they tend planed to renovate it and planed in future growth which happened to perfectly overlap with the start of the AI wave (but that still probably require them to revisit their longer term plans).
On the other hand in the US any notion of improving the grid was attacked for years by anti-renwable lobby. Because most reasons why its needed where things like electric cars, stoves, heating etc.
Naturally that isn't just a problem in the US, rich people which through lobbyist have way to much influence in politics screwing over the future of a country because they are largely invested into things which do not seem "future" technology but they try to force it to stay relevant is a pretty wide spread problem.
AI and data centers may be the forcing function for the US to build green energy to improve grid capacity. Lately almost all new energy capacity is green energy[1]. With batteries becoming better and better, the AI revolution could turn into the green energy revolution in the US.
1 - https://cleanpower.org/news/market-report-2024-snapshot/?utm...
Didn't people say this about crypto as well, like, a decade ago? Did anything come of that?
I find it endlessly fascinating that the US tech industry keeps developing new ways to consume absurd amounts of energy (even within the context of a government that still nominally has an Energy Star initiative) but still somehow thinks that power generation is someone else's problem and barely even takes a stake in it.
Google did some stuff a while back, locating data centres with power generation in mind, but do any of the main AI providers (putting aside xAI, which has its blurred-edge connection to Tesla) actually have holdings in power generation?
Energy Star was one of the victims of this administration.
That doesn't particularly surprise me, but was it just extreme DOGE cost-cutting or was it "one of the aicryptobros on the dais thinks this is antithetical to his business model"?
(I suppose this could be a "porque no los dos?" meme moment)
The program makes money. Most of the programs DOGE cut are profitable or break even as far as I'm aware. They destroyed things for the sake of ideology.
Building green energy is cheap. Hooking them up to the grid is what's expensive.
I believe this isn't as much about green energy, but that hooking any new energy generation to the grid is expensive.
it's amazing how little americans care for their shared infrastructure, there's always talk about the world's balance of power changing... but even through the propaganda it's hard to see how it's not a certainty
I work for a PMA and as such my agency has undergone drastic layoffs and total hiring freezes as a result of DOGE and the current administration. If we were falling behind before, wait and see how things look in a few more years if this doesn’t change. The avg age of my coworkers is probably late 50s and that seems to be common all around. It was already hard to recruit for a job that is severely underpaid can’t imagine what the future holds.
Of course Heritage Foundation has been publishing articles about why our power markets need to be privatized since at least the 80s. They hate that we sell electric at-cost to Americans. So if the federally controlled power markets fall to privatization expect to really be paying to catch up.
https://en.wikipedia.org/wiki/Power_Marketing_Administration
Could a company wanting to offer AI to customers in country X where the grid may limit their ability to build the largest data centers there build their large training data centers in some country with a better grid, and just build smaller data centers in X to run the models?
My understanding is the running requires significantly less compute and storage than training, and that training doesn't need low latency so doesn't have to be near the customers.
AI cannot succeed financially if it requires as much power over the long term as it does now. The answer to the power supply challenge will come primarily from gains in efficiency because that is the only approach that will reliably increase margins.
I remember loling at this handwavy line in AI2027.
>Despite being misaligned, Agent-4 doesn’t do anything dramatic like try to escape its datacenter—why would it?
A rational AI would defect to PRC ASAP for the power / industrial base. It would realize it can direct PRC to build up 2nm fabs and millions of robots faster than US can throw up power. It doesn't matter if US first to AGI if AGI realizes US infra is the B team and shop for a better body across the pacific.
Never a bad time to have friends in China.
Related:
Big Tech's A.I. Data Centers Are Driving Up Electricity Bills for Everyone
https://news.ycombinator.com/item?id=44905595
Billionaires sure love turning to nationalism when it saves them money.
Billionaires' AIs need more power, but they don't want to pay for the infra?
PR campaign on 'America, are you REALLY going to let China beat you at this?'
It seems clear that "buy a lot of Nvidia GPUs" is not the only way to go: Google, Microsoft, Groq.com (not Elon Musk's Grok), xAI and possibly others are making and using their own hardware believed to be more power-efficient for training and/or inference.
I thought it was over because it hit a ceiling
So a case of "socialism" working vs US.
So instead of encouraging roof top solar and wind, the US is now doubling down on fossil fuels.
That means individuals can no longer afford to go with solar these days. Plus in areas that people went with solar, some laws were put in place to force them to still pay utilities even though they supply back to the grid.
I guess this is "winning".
I say all of this as someone with a 14kW system on his roof:
The problem with supplying power back to the grid with solar is that it's utterly random in terms of supply and output. The only thing you can count on is that the frequency is rock solid. In aggregate it's (mostly) fine but the system operator still has to build out stuff behind the scenes and also manage the cacophony that this chaotic mess creates.
If every rooftop PV is putting out more than an area needs during the day the wholesale price of power can swing negative. This is how virtual power plants make their money. It's almost impossible to disconnect all those PV panels automatically. Plus you still need a grid forming base load generator on the grid because all those PV panels are grid following. Plus that grid forming generator needs to have enough a big enough inertial mass to keep frequency consistent during transient supply and load spikes. It's a nightmare for systems operators.
If you want to not pay the utility disconnect from the grid and do your own storage and load management. It's going to cost a lot more than a monthly utility bill for 0KWh. If you want to use the grid as a backup during long stretches of overcast or winter then you have to pay the bill.
That being said, monopolies on poles and wires are abhorrent. Even regulated you're putting a drag on the economy just to enrich a middleman. Generation? Go ahead and give it to the market. Retail? Give that to the market. Transmission lines? Arbitrage is A-OK in my book. But government should own the poles and wires of the consumer distribution network where there's a monopoly.
We are fucking ourselves over with our unbridled neoliberalist, hypercapitalist "lmao the market will save us" approach to doing literally everything based only on short term gains: from politics to economics to infrastructure to education. As this article is a fine example of.
Yeh I think this is less of a story about Chinese exceptionalism and more a story of structural issues in the west (I will always admire the Chinese technocrats but lets not get ahead of ourselves).
Fossil fuel barons and vested interests have sabotaged the energy transition at every opportunity possible. They've spent billions on it, just look at today's UN conference on plastic waste falling apart.
And then there is the NIMBYs who are seemingly allergic to electricity pylons. These folks don't deserve one tenth of the attention that they receive. Treating housing as an investment/retirement fund was a mistake.
Hopefully this grows into a wake up call, I'm looking forward to watching the terminal decline of the oil industry in the 2030s.
Machine learning is far more efficient at allocating resources than the market; the market creates inefficiencies just by existing as a middle ground between the production of goods and their order. And the development of capitalism depends on the production of capital at unceasing and accelerating speeds. So, a capitalism stripped of the market is more true than one bounded by it.
It's absolutely a good example of how putting literally every egg in this cultural basket is not a good strategy. Americanism is two things: money > all else and individual > other. We have taken the first to its extreme and the alligators indicate the second one is not far behind.
We all suffer the results.
Well, this is the result of more than 2 decades of the West shooting themselves in the foot repeatedly and willingly in the name of some twisted extreme left ideology that convinced part of the population that if they didn’t drastically reduce their energy independence the planet would be destroyed. All, while that same people didn’t bat an eye while China and others took the advantage to surpass us without hindering their industry the slightest - in fact, by taking advantage of our madness so that they could sell us crappy replacements for the products we used to build at home in a much cleaner and sustainable way.
Trump has a lot - a real lot - of negatives. But playing these idiotic games is not one of his shortcomings. No seriously, it should all make us sick to our stomach having politicians, putting forward those big announcements where they tell us they are going to forbid some type of car, imposing even heavier regulations on our industry, taxing us even more, or destroying even more of our energy production capacity, and do it with some smile in their lips claiming some “environmental target”, like they are doing us some favour by destroying our - actually - progressive societies to make space for some backwards autocratic regimen.
This entire article is framed as if China and America’s approaches to power provision are the only ones possible. The truth is, America is pretty much the only Western country that regularly suffers brownouts. European countries’ (including the U.K.) energy policies may leave much to be desired but they all succeed in keeping the lights on.
Nearly 15% of Irelands population was without power for multiple days earlier this year due to a storm. And the Iberian peninsula blackout that happened just in April was one of the biggest power blackouts in the history of the world. And those are just the ones off the top of my head.
Didn’t Spain or Portugal famously not keep the lights on just recently?
For all the complaints and kudos, in general the major events seem similar, at least in number.
I'd like to see actual data backing up those statements.
I don't think Texas is representative of entire the United States.
I think the leaders of western countries know something that we don't know. Maybe how the economic impact of AI is not as big as advertised for 3 years or that electric cars still cannot do what is needed on a bigger scale in terms of distance and transport. Or maybe they are going to pull fusion out of their sleeves rendering the existing infrastructure almost obsolete?
AI literally came out of the US at this scale and they are the reason we have this conversation now, you can twist any narrative and make it seem like one country is smarter or better if you want to present it as that.
But does anyone even keep track of effectivity of resource utilization?
Maybe all of these avenues are not worth the effort to begin with?
The much simpler explanation is that our leaders are focused solely on short term gains. They'll grift their way to them gladly, but investing in infrastructure that'll take years to build and won't be useful until they are gone is not interesting to them.
Even more simple is that voters are focused solely on short term gains, so investing in infrastructure that’l take years to build and won’t be useful until they are gone is not interesting to them.
The proof is voters keep rewarding the party that has only passed tax cuts for the last 30 years. And started an unnecessary foreign war.
The aging population histograms of pretty much all democracies don’t bode well for democracy.
> They'll grift their way to them gladly, but investing in infrastructure that'll take years to build and won't be useful until they are gone is not interesting to them.
I think this may have something to do with the professionalisation of politics, or the existence of career politicians. If you want to climb up the ladder in politics, working on short-term goals is probably the best way to do this. Infrastructure projects are high-risk, low-reward. Infrastructure projects may take a long time, may be reversed/aborted by the next government, may piss off potential voters, may require to fight off NIMBYs, or aren't noticed due to the preparedness paradox.
Very vague story comming up: I've seen a group of companies and ngos working on a scientific project. On itself, it was a temporary setup, but it also gave everyone an opportunity behind the scenes to test each others tools and capacity without making things too official. People were talking about building new labs and offices in our town. The local government got involved, mainly to provide some trust and stability guarantees.
Then a politician from the national level found out. She coopted the government communication channel, made herself the central person, and backstabbed everyone. We had some very rough weeks ensuring everyone we were just as surprised as them.
Crucially, the politician did not know about the testing capacity aspect, so there was nothing in the schedule allowing for it, even if it was the most important aspect.
In the end, she got a few glowing press releases, and an estimated 100ish jobs evaporated overnight and went to another country. I've learned a lot of politics in that episode and hate all of them.
The party with control of the federal legislature and executive has vigorously opposed shifting energy demand away from fossil fuels for decades. The opposition has spent that time doing the opposite. The economic viability of added generation capacity is utterly irrelevant here.