Selling Wind Randomly

Many countries are attempting to reduce emissions of greenhouse gases by investing in wind power. Wind power is inherently random, but we are used to 100 percent reliable electricity service. Converting random wind into reliable electricity is quite expensive, so wind power producers require large subsidies to stay in business. We propose an alternative. Let us package random wind power into electricity with different levels of reliability and sell them at different prices. Such an electricity market will reduce subsidies, and it is more efficient than the current market. However, we have to think of electricity differently.
Pravin Varaiya is Professor of the Graduate School in the Department of Electrical Engineering and Computer Sciences at the University of California, Berkeley. From 1975 to 1992 he was also Professor of Economics. His current research interests include transportation networks and electric power systems.

His honors include a Guggenheim Fellowship, three honorary doctorates, the Field Medal and Bode Prize of the IEEE Control Systems Society, the Richard E. Bellman Control Heritage Award, and the Outstanding Research Award of the IEEE Intelligent Transportation Systems Society. He is a Fellow of the IEEE, a member of the National Academy of Engineering, and a Fellow of the American Academy of Arts and Sciences.