Thread by @gbponz

Well... that requires a clarification. Lest people think the #German government hadn't spent two decades working on the country's demise.(/) @Halsrethink @ektrit @jeuasommenulle @nglinsman @Ed___________0 @petunianelsole @LorenaLuVi @andrepaltry @AlessandroPonz4 @eshow1969

https://twitter.com/AndrewHammel1/status/1568160434254921728

"Competitive advantage" comes from "Competition", i.e. trying to be on average better or at least adequate in a game where may players are involved and where everyone sees everyone else. Think "bicycle race". (/)

But it is not enough to be adequate on a STATIC framework: there are ups and downs, hills and turns. So there is an element of foresight and tradeoffs needed. Time lags are also EXTREMELY important. Look up #OODA Loop for reference. (/)

So, any player in #Energy knew DECADES ago that, say, #Germany and #France had quite different #Electricity models. France, by virtue of their De Gaulle insistence on not being vulnerable to oil shocks, well, it made sure it didn't by building A LOT of #NuclearPower plants.(/)

They built 56 plants in 15 years, an impressive rate, and that to all intent and purposes insulates electricity production from the #Oil price in terms of actual cash cost and availability:(/)

The KEY term is "availability": even in a constrained #oil supply, Nukes go full tilt. And in a marginal price system, with current rates Nukes do this:
BUT, no brownouts, and no cuts or rationing. Also, there is an element of roundtrip economy:(/)

Money spent by French high energy consumption compartment flows to French utilities who pay taxes which could be used to lighten the load. OR, some of those would actually buy and operate smaller Nuclear plants to stabilize their cost base.(/)

Hence, Germany knew FULL WELL, SINCE 1973, that they had done a partial "fixed for variable" cost swap, and thanks to Frau #Merkel that Swap has become total. They had an energy price risk for DECADES, #Putin or not. Was it a calculated risk? Was it correctly told?