Electricity markets are rigged — consumers robbed!

For decades Wall Street financial engineers, teaming up with electric power producers, have gamed wholesale electricity auctions to earn bigger profits than either a regulated utility or a competitive market would yield. This month they made a major advance in their campaign to get rich by subtly draining your wallet. Yet every major news organization ignored this.

This latest development took place in New England, which already has America’s most expensive electricity. February’s electricity auction saw the annual cost to customers rise to $4 billion, up from about $3 billion in last year’s auction and less than $2 billion in the 2013 auction. That $4 billion figure would have been much higher but for a rule capping prices.

By the way, that $4 billion is not for the electricity, which costs extra. The $4 billion price tag is for capacity payments made to owners just for promising to run their power plants in 2018 and ’19.

If that sounds bizarre, it’s because it is. It is comparable to government taxing us to pay auto dealers to keep enough cars and trucks on their lots to satisfy expected future demand.

Half the states also have auctions that set the price of electricity for periods ranging from a year down to a few minutes. The other half still rely on traditional rate regulation, which has its own problems.

If there is abundant capacity to produce power at peak periods, such as hot summer afternoons, then prices will not rise much, if at all. But if there is barely enough power to meet demand, then prices rise significantly. And if capacity is just 1 percent less than demand, the wholesale price soars.

In these auctions every producer gets the top price even if most bid far less. These are known as clearing price auctions, in which the highest bidder sets the price for all suppliers…

Robert McCullough, an Oregon utility economist known for busting industry myths, says gaming of electricity markets is easy and lucrative, as long as regulators look the other way.

“With perfect competition, you always bid your marginal cost — as the economist Alfred Marshall was pointing more than a hundred years ago,” McCullough said. “However, when your market share is sufficiently high that you have the potential to set the market price, it is in your interest to raise your price above marginal cost, even though you will lose some of your market share” because one or more of your fleet of power plants will produce no electricity and thus not collect any money.

“This gets even better when you can buy someone else’s plant and shut it down,” McCullough added, because the reduced capacity means higher prices. Combined with the savings from not operating the shuttered plant, the result is much bigger profits.

Yes, these are the same schmucks who bankroll Republican agitprop about how free market capitalism guarantees our freedom. They leave out the part about buying politicians, buying off regulators with better-paying jobs as a reward when they’re through pimping the biz.

Then you get to double dippers like North Carolina’s governor Pat McCrory. He had a whole career working for Duke Energy. Left to become the gpvernor and, no doubt, will return to being officially on the payroll, once again, after he’s through directing that state’s legislative mediocrity into further kissing corporate butt.

Are diabetics dumb enough to share pen devices and [sometimes] needles

The FDA is adding a warning label on diabetes pen devices, making clear that the pens are intended for single patient use only and shouldn’t be shared, even if the needle is changed.

In an announcement on their website last week, the agency said they are trying to reduce the risk of serious infections from the sharing of multidose pens. They will require that pens and packaging with multiple doses of insulin or other injectable diabetes medicines carry a warning label stating “For single patient use only.”

The FDA will also add warnings in the prescribing information and to the patient Medication Guides, Patient Package Inserts, and Instructions for Use. There are several different brands of the pens on the market, including exenatide (Byetta), liraglutide (Victoza), pramlintide acetate (Symlin), insulin detemir (Levemir), and insulin glargine (Lantus).

Pen cartridges usually contain enough insulin for several doses. After a patient uses the pen, blood might be on the pen even when the needle is changed, said the FDA.

The FDA saw signs as early as 2008, when the Institute of Safe Medication Practices brought up the issue, that bloodborne pathogens could be shared with pens designed for one patient only. In 2009, a U.S. Army facility announced that more than 2,000 patients were infected with a pathogen when pens were shared, leading to the FDA issuing an alert.

And in 2013, the Veterans Health Administration notified 716 patients that they might have been exposed because the devices were shared…

C’mon, folks. A little sensible hygiene goes a long way. Injectable medication has always carried the risk of bloodborne infection when devices are shared. Not rocket science.

Tim Cook won’t back down — opposes terrorism, selling data, and snooping

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During an unannounced visit to Apple’s Covent Garden store

Following comments regarding Apple Watch specifications and an upcoming Apple Store revamp, Cook spoke with the Telegraph in an extensive interview covering data privacy, government snooping, terrorism and more.

The Apple chief is cognizant of the amount of customer information being “trafficked around” by corporations, governments and other organizations, saying data sharing is a practice that goes against Apple’s core philosophies. He said consumers, however, “don’t fully understand what is going on” at present, but “one day they will, and will be very offended.”

“None of us should accept that the government or a company or anybody should have access to all of our private information,” Cook said. “This is a basic human right. We all have a right to privacy. We shouldn’t give it up. We shouldn’t give in to scare-mongering or to people who fundamentally don’t understand the details…”

The publication also asked about implications of terrorism, especially government surveillance operations created with the intent of aiding law enforcement agencies. Cook took a hard-nosed stance on the topic, saying the issue is a non-starter in his book because terrorists use proprietary encryption tools not under the control of U.S. or UK governments.

“Terrorists will encrypt. They know what to do,” Cook said. “If we don’t encrypt, the people we affect [by cracking down on privacy] are the good people. They are the 99.999 percent of people who are good.” He added, “You don’t want to eliminate everyone’s privacy. If you do, you not only don’t solve the terrorist issue but you also take away something that is a human right. The consequences of doing that are very significant…”

The executive reiterated Apple’s mantra of making products, not marketing consumers as products. Every device and service that comes out of Cupertino is designed to store only a minimal amount of customer information, Cook said.

Finally, Cook talked about privacy as it applies to Apple Pay, the fledgling payments service Apple rolled out in October. Unlike other payments processors, Apple designed Apple Pay to reveal little to no information to outside parties, including itself.

“If you use your phone to buy something on Apple Pay, we don’t want to know what you bought, how much you paid for it and where you bought it. That is between you, your bank and the merchant,” Cook said. “Could we make money from knowing about this? Of course. Do you want us to do that that? No. Would it be in our value system to do that? No. We’ve designed [Apple Pay] to be private and for it to be secure.”

I love the privacy of Apple Pay. I haven’t stopped smiling since the first time a checkout clerk exclaimed…”It doesn’t even tell me your name!”

This is excerpted from a long interview in the TELEGRAPH – worth reading.