'Ultra-cheap energy for every household': could a different kind of tariff change everything?
'Ultra-cheap energy for every household': could a different kind of tariff change everything?
Rising block tariffs and national energy guarantee systems are almost unknown in Europe – but are flourishing elsewhere
More than half of the world’s population lives under an energy system that its advocates say can tackle fuel poverty, improve crumbling housing stock and reduce energy demand. And to cap it off – when properly designed – it would not cost the taxpayer anything.
The so-called rising block tariff or national energy guarantee system (NEG) are almost unknown in Europe but operate successfully in many other countries and regions – from Japan, South Korea and China to Bangladesh, India and California.
That's a pretty sensible idea. Whilst reading the article I thought, "why the fuck don't we do this already?".
There's a fair challenge about half way through where it says that poor (and large) families that rip through the free / cheap block due to their size will end up paying higher rates. Conversely a single mid twenties social media influencer higher earner could end up paying nothing - not the trade off we want 😉.
However those are smaller implementation details that need not completely squash this idea. I'd definitely like to see this spoken about more by the government.
Yep, this scheme worked quite well when I lived in California. Having a partner certainly raised my electricity usage, almost to the full low-tier block. Never went past the limit in 5yrs though.
I would worry that such a scheme would discourage technologies like heat pumps and EVs. We want people to use electricity more because it's cleaner than the alternatives and only getting cleaner.
The fuel crisis triggered by the Ukraine invasion is over. Prices have stabilised (Look at the 5y chart). The swift pivot away from cheap Russian gas still leaves prices raised, but we're back at the higher end of the normal fluctuation range pre-invasion. The "energy crisis" isnt a good reason to do something like this now.