 scmn | When you raise the price of electricity demand will drop which increases availability. Demand will drop because people will set their thermostat to 74 instead of 68 knowing it will save on the bill; consequently, as the price increases it also makes it profitable to divert electricity in from other providers that have excess capacity; when they become capacity limited they will raise their price, which inturn will drive their demand down and make more available to sell. Raise the price enought and they will sell you more at a higher cost. When you keep the price high enough, long enough they will add more capacity to capitalize on additional profits. It is as simply basic economics of supply and demand. |