How to make money from free electricity (and not draw attention)? [closed]

Question

TL;DR

Some new magic/handwavium device provides free electricity. How does my character make (good) money out of that without letting people/the authorities know about the device?

Longer background

My story explores some angles regarding the transition to a post-scarcity society. It is set in current times (2023 at writing, or perhaps up to 5 or even 10 years into the future, no more).

My main character is a hobby tinkerer (somewhat skilled and practical, but no extraordinary knowledge or talent). He has this [insert video site] channel where he builds "free energy" devices from obscure internet plans, showing that they don't work, and debunking and mocking the whole perpetual motion idea again and again (snicker). The channel is not hugely successful, and he hasn't quit his day job.

His latest device, to his infinite (hehe) surprise, actually produces electricity out of thin air. Not very much, a few Watts, he ran some lights off of it, and after building more of these devices, he canceled his home's electricity connection. Soon his heating gas/oil follows. After more thought and preparation (rain collection, purification, condensation), he cuts his municipal water supply too.

Being an avid consumer of science fiction, he soon figures that this device could well mean the start of a life of having everything you want (or at least, need) for free. But at this point he still needs to work his job and channel to get money to buy food...

So he acquires some cryptocurrency mining equipment. By now his savings are depleted, mining is slow and becomes increasingly difficult, [insert cryptocurrency] is falling in value, ... He is making money, but very slowly, it takes time to collect enough money to grow his operation. If he could just ramp up enough to not have to share his results with the mining pool and still get a regular income stream... Or, you know, set up his own pool for other miners.

To boot, the future of proof of work cryptocurrencies is unsure, being called a bubble by some; Ethereum for example has recently transitioned to proof of stake with a 99% electricity saving. What other means could he use to turn that free electricity into money? He has the following considerations:

• He does not even know on which principle the device works. Is it magic, or some undiscovered natural phenomenon? Is it really infinite? And harmless? (After all, people once thought fossil fuels were an inexhaustible energy source, just extract them from the earth. And the atmosphere is an infinite sink where combustion waste products could be dumped...) More scientific study needed. And scientists, especially ones that will keep quiet, are expensive.
• He does not want to become the same laughing stock that he once made of other "crackpots" on his channel.
• He does not want Big Electricity/Illuminati (the puns keep writing themselves) to buy up his patents, and/or "accident" him, like that guy that invented the car engine that ran on water.
• If his operation gets too big, it will generate some heat or noise signature that will be discovered by authorities sooner or later.
• If he makes and sells "electricity generators", nosey customers or competitors will soon crack them open to discover their working principle. I know that if someone wants to sell such a thing, but it takes no inputs, I'd steer well clear of shelling out good money for it.
• If he sets up an electricity utility, he will need to comply with all sorts of regulations and be open to scrutiny.
• Look, it is nice to have material wealth and be better off... It's even better if you don't have to answer to a boss any more. (Although he will soon need to think about how to hide from the Tax collectors...) For most of us I believe it is preferrable to have something and be happy, than to own nothing and be happy.

Answer 1

Frame challenge

The devices produce only a few Watts each. Suppose your protagonist runs these devices continuously and they have no downtime, and he can get the market rate for the electricity as paid by consumers. Suppose his infinite supply of energy does not crash the price of energy, and there are no overhead costs at all on delivering the electrical energy to where it needs to be for him to make his profit.

That is, your protagonist isn't necessarily selling power to other people, but whatever he's doing, suppose he's making as much money as the power companies could make from selling the same power even if all of their revenue were profit. (If it were more profitable for the power companies to mine cryptocurrencies instead of sell power to consumers, they would do so themselves.)

Let's say "a few Watts" is 10 W, and the price of energy is reliably \$0.20 per kWh (a generous overestimate as of writing). Then each device makes about \$17.50 per year. If it costs \$100 in parts and labour to build one of these devices, then that investment will break even in 5.7 years, meaning that's how long it takes after building the first device for your protagonist to be able to fund the next device from the proceeds.

Now, a doubling time of 11.4 years is not a bad rate of return if all of this is passive and risk-free. But it isn't, of course. Your protagonist has a full-time job building these devices and managing whatever venture converts their power into dollars; and he is exposed to whatever risks come from that venture. Cryptocurrency is one of the riskier financial instruments, selling power to consumers or the grid exposes him to risk from the variable market price of energy, and so on.

All told, your protagonist would be better off just working a normal job and investing his savings in a stock market index fund. Or he could win a $1,000,000 prize from the James Randi Educational Foundation by demonstrating that his device really works. That sounds like the smart option.

Answer 2

Start a solar power farm.

Sell your computer gear and buy some portable batteries. Make fake solar power panels. Research the local power prices, and negotiate to provide cheaper power for whoever from your solar farms. A restaurant can easily use 5k dollars for electricity a month, so even if you can supply a single one with cheap power you should be able to make a decent profit.

Over time you'll want to purchase a building in town and some cheaper land in the country. You can have your fake solar panels out in the country, and your unlimited energy, and charge big battery packs to take to businesses. They can say how they have green energy, and you can supply power.

Regulations on solar panels are fairly light, so you should be fine.

Answer 3

My first thought is to begin with subterfuge. Stick with crypto-mining to get a start. Mortgage your house, cash in your retirement and sell what you can for the equipment. That operation can grow exponentially; invest every new coin back into more equipment. The falling price doesn't matter if your electricity is free.

When you have enough cash flow, I'd suggest set up an Electric Vehicle recharging station; and out of the goodness of your philanthropic heart, to promote green energy, sell the electricity "at cost" +25 cents per charge to cover overhead. i.e. what the joules would cost if you were buying them from the grid.

Actually connect it to the grid. Let it get inspected.

Then mix your free electricity with grid electricity, 50/50. That is pretty basic freshman level electrical engineering. If you think 50/50 is too aggressive, make it 75% grid, 25% free. But buying land and operating the charging stations will not be free; you will still have some overhead costs.

Nobody is going to be counting cars and how much charge each needed. The electric company will meter the total, that's it. But you are getting your electricity at effectively half-price, and selling it for twice that, and you can fudge your books to say you sold exactly the number of Joules "pumped" as the meter says you actually did draw from the Grid -- which nobody will question, the books balance!

Eventually, open more recharging stations, because you are a great philanthropist.

When you have enough money to protect yourself and your operation, move to a friendly country, or buy an island, or perhaps a failed country, where you can provide electricity to the world with no oversight as to how it was produced, from a fortress guarded by your own army.

You can still be a philanthropist here, gradually lowering the price of electricity to just your actual overhead of delivery; the cost of running your production centers (all fortresses) and maintaining your distribution channels. The electricity is free but getting it to the people is not, unless you just want to publish it for all to see. But even that (freely disseminating the knowledge and plans) would cost hundreds of $millions, you need to prove it to the engineers and skeptics. A page on the Internet isn't enough.

Otherwise, the super rich (like energy companies) and super criminal will ensure only they ever know your method; you will be eliminated the day they are certain they know what you know.

Answer 4

Batteries.

He mains 100% control of the technology because he makes and charges the batteries himself.

For distribution, either he sets up some sort of online store, or (what I would prefer) he establishes a network of street-level dealers. I'm picturing him starting out like Jimmy McGill in Better Call Saul selling cell phones out of his trunk and growing into a full-scale kingpin like Walter White in Breaking Bad. He can start small with stuff like AA and D cell batteries, and then work up to bigger stuff like car batteries. He keeps the source of the batteries to himself, telling his distributors he's smuggling the batteries in from Mexico or wherever; generally, he keeps the dealers at a distance by using dead drops and such.

Meanwhile, he keeps up the video channel to avoid arousing suspicion, and he debunks his own technology so no one else will try it.

To take a step back and look at this in terms of worldbuilding... I think it's fairly safe to say that when a desirable good is scarce, black markets will develop to trade in it. So it stands to reason that if electricity is scarce in your world, there is already in existence (prior to his discovery) some black market for trading electricity. Presumably major players like large businesses still tap into Big Electricity, so the black markets would likely serve individual users. The electricity needs of most individuals typically can be supplied by a range of small batteries, so it's reasonable to think that the black market trade would focus on car batteries and smaller. When your protagonist decides to monetize his discovery, then, his challenge isn't how to devise an entire new electricity distribution apparatus himself; rather, he needs to figure out how to elbow his way in to the existing black market for batteries. Luckily, he has two advantages:

1. Because he's both a producer and distributor himself (not buying from smugglers/producers like the rest of his competition), he has several fewer layers of middlemen to deal with and can sell at more competitive prices and/or keep more of the profit for himself to reinvest in his business.

2. Because he has control over the electricity production AND the electricity is "free" (minus the cost of his time in making it), he can sell a superior battery. If his competitors have to pay some producer for every battery they sell, they will likely start to "cut" their product in order to stretch it farther. So imagine they sell batteries in packs of 10: 9 of them are purchased full from the smuggler/producer, and the 10th is empty to start with. They then drain 10% of the charge from each full battery and use it to recharge the dead one. So now they're passing this off as 10 batteries each charged to 100%, but in fact it's really 10 batteries each charged to 90%, and most users can't tell the difference. When your guy comes along, he can demonstrate fairly easily that his batteries last longer, and that helps him take over the market.

Of course, when one takes over the black market, one tends to make dangerous enemies.

Answer 5

Hide it in an ordinary wind/solar farm.

I wrote another answer about hiding it with crypto, but you've made that off-topic so I'm not posting it here.

So instead, you hide it in "green" power. I'm not saying "green" to be trendy, but rather because the alternatives suck. With fossil, nuclear or hydro, you have one enormous energy source. That is, your ratio of "staff members:generation units" is greater than 1. That means you have highly technical staff dedicated to that unit, plus regulators, all watching output like a hawk. You can't sneak stuff in there.

Whereas with a solar or wind farm, your staff:unit ratio is less than 1, and any given engineer maintains dozens of windmills/solar banks, and no engineer feels "ownership" of any unit - they don't see the big picture.

The other thing is, with wind/solar the capital investment is much more manageable. You can buy land cheap, then build a tiny array and grow it with the proceeds. No one thinks this is odd.

So, you are able to "sneak in" additional generation to the grid, by augmenting the power you genuinely are making using solar and wind. Obviously, don't make a spectacle of yourself by feeding the grid when the sun is down :)

Batteries not included.

To improve your obfuscation of that situation and go after the huge money in the peaking market, add batteries. (you can barely give away morning solar, because buildings have significant thermal mass external to the insulation envelope, which time-delays the need for A/C. Hence batteries make sense.)

Now you have a more complex wind-solar-battery plant that is easier to obfuscate - nobody understands the big picture except key managers, and you make sure that's you and your family.

When the wind blows or the sun shines, you feed your "free" energy to the grid alongside genuine power. At peak times, you feed the grid from your batteries and add your free energy to that. The rest of the time, your free energy charges the batteries.