Electricity: Supply and Demand

Electricity, unlike fossil fuels, cannot be easily stored, making demand forecasting crucial. The electricity market is competitive, akin to commodities like tea or coffee, but with the unique challenge of non-storability. Providers must precisely match production with demand to remain profitable. Mothballing, or temporarily closing power plants, is a strategy used when demand and prices are low, but it poses risks of supply shortages when demand rises. The industry faces challenges in balancing supply and demand, with potential blackouts if not managed well. Until better production or storage solutions are found, market forces will continue to dominate the electricity sector.

Discuss the impact of price fluctuations on electricity production and availability.

What factors contribute to the complexity of profitability in the global energy market?