Thread by @BaldingsWorld

Short thread on China electricity and epistemology. There is in all things a rush to impute motives or generate an understanding about a situation based upon pre-existing mental framework when the reality is we know very few facts about a situation. China electricity is great 1/n

I started hearing about this and other situations a few weeks ago but it made no sense why. There was no obvious reason why China should be facing electrical shortages. All of the narratives had glaring holes. It was only after talking to a number of people the pieces came 2/n

Together that was confirmed with multiple people. Now it is still important to note we really do not understand a lot here though the mechanics of the situation are clear. By that I mean, it is clear facts that end user price is fixed, generators buy basically at spot 3/n

So generators are refusing to produce given they lose money on every kwh. Those are the direct mechanics. What we do not understand are the second order politics and bureaucratic infighting about this issue. By that I mean why hasn't the issue been addressed? The popular 4/n

Narrative might be the environment but who really believes China is going to a 3 day work week to save the environment. Wildly out of character doesn't begin to describe how far outside expectation that would be. There really is no evidence to support this idea 5/n

In that case in the absence of evidence we are imputing our desired motivation rather than what evidence tells us. My personal general mental model in these situations is incompetence and inertia. By that I mean in this case, the coal price spiked so fast from pent up demand 6/n

That Chinese bureaucrats in trying to control the market have not acted fast enough to prevent this scenario and probably did not anticipate it. In fairness, the coal miners and electrical generators/transmitters are of a similar political importance in China so any 7/n

Fighting over what to do puts the Chinese regulator in an unenviable spot and likely delay any decision leading us to where we are at now. It is also notable that in China the companies in these sectors are big enough to almost be a state within a state. Real heavy weights 8/n

To circle back, we know the mechanics the politics, bureaucracy, and knives drawn fighting can be generalized but are still largely a black box. One would be prudent to tread lightly when implying motives upon actors or institutions in China.