How will distributed generation affect physical power trading?
We have increasingly been seeing headlines such as the "death of utilities" due to renewable energy and distributed generation (most recently in regards to Tesla's Giga Factory), but no one ever seems to address how this may affect the trading shops. I have limited knowledge in this area and hope to provoke some of the more experienced energy professionals on this site. Perhaps one could look at how physical power desks in Germany have fared over the past decade?
Traders have made a killing shorting German power.
Also Germany is pretty unique in the it's whole sale power is very cheap because of subsidies (whole sale is the power that's traded) and it's retail power is the most expensive in Europe (this is the power we use and industrials use)
Because of this relationship there is pressure on the govt in Germany to reduce subsidies which would lead to higher prices.
Plus there is volatility on the German power market related to carbon credits.
All in all, even with such a strong renewables portfolio, there is a ton of money to be made if you know what you're doing. Especially with the French-German interconnects.
The USA is a long way from having any kind of renewable portfolio like Germany. Probably 10+ years
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