Protecting the needy

fretwej

Why can't energy companies use a tiered charging system. The first however many kilowatt hours are charged at a cheap rate then more expensive rates are used the more energy you use, similar in a way to income tax. This would protect the lighter users in smaller homes who I think are the more needy of help while those in larger homes/mansions pay a more expensive rate as they use more energy. Seems a more targetted option than the government just giving handouts to everyone, even the rich.

stewie_griffin

What about households with poor insulation and expensive electrical heating that can’t afford to pay for improvements. They’re likely to be fuel poor already and your suggestion would make it worse. Also more well off households could afford solar panels and battery storage to help reduce their usage. Small home doesn’t necessarily mean low usage.

Max68

The water companies have a social tariff for anyone earning less that £16,000 and under a certain amount of savings I believe.  Pity energy companies can't do the same.  That's the issue with Liz Truss's tax reduction plan, it doesn't help those on a low wage or pensioners.

[Deleted User]

Social tariffs are paid for by other energy users in the form of higher bills. In the last great inflation period in the 70s, the people who struggled the most were those who had an income just above the support level. The last thing that they need is even higher energy prices.

 It is interesting that the supplier that is advocating social tariffs is the one that could have a very large number of struggling customers. One has to question their motives.

In sum, more financial support is a must but other energy customers shouldn’t end up directly paying for it. 

pochase

What about older people who need more energy to keep warm?

What about people who need medical devices?

What about people who are sick or disabled?


Why can't low energy users who pay not much anyway not pay more to help above people?

Max68

[Deleted User] said:

Social tariffs are paid for by other energy users in the form of higher bills. In the last great inflation period in the 70s, the people who struggled the most were those who had an income just above the support level. The last thing that they need is even higher energy prices.

 It is interesting that the supplier that is advocating social tariffs is the one that could have a very large number of struggling customers. One has to question their motives.

In sum, more financial support is a must but other energy customers shouldn’t end up directly paying for it. 

Very true.

artyboy

Ultimately this would just be another form of taxation with a different mask on. I'm not actually against it in principle, but only if it was accompanied with generous grants for people in those older draughtier homes to improve their insulation/efficiency.

Ultrasonic

Broadly I actually think the idea of tariffs with costs tapered by usage have merit. In the short term as a way to give every household some minimum amount of energy at an affordable cost, and longer term as a way to incentivise a reduction in usage.

pochase said:

What about older people who need more energy to keep warm?

What about people who need medical devices?

What about people who are sick or disabled?


Why can't low energy users who pay not much anyway not pay more to help above people?

I'd suggest all of those counter-examples could be addressed by benefits targeted specifically at these groups.

[Deleted User]

artyboy said:

Ultimately this would just be another form of taxation with a different mask on. I'm not actually against it in principle, but only if it was accompanied with generous grants for people in those older draughtier homes to improve their insulation/efficiency.

Let me be a Devil’s Advocate. Why should the Government (or more precisely taxpayers/energy consumers) pay for generous grants to people to insulate their homes?  I am all for loans to consumers to insulate properties paid back from the reduction in energy costs PROVIDED the Government can come up with a scheme that actually works.

sevenhills

Ultrasonic said:

Broadly I actually think the idea of tariffs with costs tapered by usage have merit. In the short term as a way to give every household some minimum amount of energy at an affordable cost, and longer term as a way to incentivise a reduction in usage.

I agree with the principle, but for the issue of climate change.
We don't want the poor to suffer when helping climate change. There should be zero taxes on a basic amount and then higher taxes as people use more.
Vehicle fuel is taxed at 60+%
Vehicle fuel tax could be reduced to 50% and then domestic fuel taxed increasingly after the basic amount is used.
Ideally this would be similar to a 'personal carbon allowance'.

BUFF

[Deleted User] said:

artyboy said:

Ultimately this would just be another form of taxation with a different mask on. I'm not actually against it in principle, but only if it was accompanied with generous grants for people in those older draughtier homes to improve their insulation/efficiency.

Let me be a Devil’s Advocate. Why should the Government (or more precisely taxpayers/energy consumers) pay for generous grants to people to insulate their homes?  I am all for loans to consumers to insulate properties paid back from the reduction in energy costs PROVIDED the Government can come up with a scheme that actually works.

Alternatively, why should the government benefit from people trying to insulate/cut back on consumption by upgrading building fabric?
I really do think that it would be a good idea to either remove VAT entirely or reduce it to 5% on replacement boilers, controls, insulation, double-glazing etc. They have already done it for people using authorised schemes or of course if it was a new-build but nothing for the vast majority who would either DIY or use a smaller local installer who probably figured that the administrative burden of the authorised schemes was not worth the hassle/income.