Much is discussed about how the UKs energy pricing pain is due to gaining no benefit from the relatively lower cost of renewables as the unit price is set by gas the majority of the time.

    I understand this system is typically how it works effectively everywhere, and that the UK faces unique pains for other reasons, such as perverse policy incentives, energy taxing, wider (high) infrastructure costs baked into bills etc.

    Many people seem to suggest that the UK could simply decouple the prices.

    How would this (or wouldn’t it) work in practice and what would the outcome be?

    Im assuming the reason this hasn’t been done already is because ‘decoupling the prices’ is just political rhetoric and putting it into practice is either difficult or stupid due to how markets work, particularly if you still need to buy and use gas as a grid backstop.

    What would ‘de-coupling’ renewable energy costs from gas in the UK look like?
    byu/boggernoff inAskEconomics



    Posted by boggernoff

    Leave A Reply
    Share via