In the News

Cost of Living Crisis - Should all households get some free energy?

Graham Watson

5th September 2022

The left-leaning New Economics Foundation have put forward some proposals to tackle the energy crisis, and they're more radical than most.

They argue that the price cap should be ditched for the poorest members of society who should be given a free basic energy package.

The idea is that there's a minimum level of free energy use, and people who use more energy than this should pay a higher price than usual, incentivising energy efficiency.

The poorest 10% of families would get the majority of their energy use across the year free. They would pay £1,900 on average for the rest, compared with an expected bill of £6,200 in April 2023.

The richest 10% of families, who consume more energy on average, would pay double the April 2023 price cap, helping to lay for lower bills for everyone else.

It's an interesting suggestion, well-targeted, and seemingly cheaper than other proposals.

If you are interested, you can read their proposals.

Graham Watson

Graham Watson has taught Economics for over twenty years. He contributes to tutor2u, reads voraciously and is interested in all aspects of Teaching and Learning.

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