95% of people objecting to this don't understand accruals-based accounting.
which is fair because it's really hard.
the other 5% have a point but I'll let them bask in their own private glory without wrecking their notifications over a shitpost 😉
which is fair because it's really hard.
the other 5% have a point but I'll let them bask in their own private glory without wrecking their notifications over a shitpost 😉
https://twitter.com/allenf32/status/1389606827478880258
I'm gonna break it down for y'all coz I'm feeling charitable this beautiful morning and also coz I stumbled upon the perfect explanatory concept:
the use case this refers to does not need to be "economical" or "competitive" in terms of what you think those words mean.
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the use case this refers to does not need to be "economical" or "competitive" in terms of what you think those words mean.
1/4
it's a form of insurance. more specifically, it is buying a put option on excess generation for which there is no grid demand.
from your point of view, you are hedging against the price going to zero by buying upfront the ability to still sell and shorting the differential.
2/4
from your point of view, you are hedging against the price going to zero by buying upfront the ability to still sell and shorting the differential.
2/4
of course, insurance - portfolio or otherwise - is totally uneconomical if you never use it ...
... IF YOU ARE A MORON OF COURSE INSURANCE IS ECONOMICAL NOBODY IN REAL LIFE IS CONFUSED BY THIS ONLY FIAT ACADEMICS HOW DOES THAT MAKE YOU FEEL???
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... IF YOU ARE A MORON OF COURSE INSURANCE IS ECONOMICAL NOBODY IN REAL LIFE IS CONFUSED BY THIS ONLY FIAT ACADEMICS HOW DOES THAT MAKE YOU FEEL???
3/4
the point is to reduce cash flow volatility and hence to reduce financing costs.
so you can call it "uneconomical" all you like but all you are proving is that you don't understand project finance or the more general concept of people being economically creative.
4/4
so you can call it "uneconomical" all you like but all you are proving is that you don't understand project finance or the more general concept of people being economically creative.
4/4
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