Figure 2 – Fiscal savings of moving from price freeze to TBI rebate proposals
- ^ To minimise the “rough justice” of flat rate rebates, we also propose adjusting rebates wherever practicable to account for EPC and number of children per household.
- ^ Under our rebates proposal, the level of rebate would be adjusted (say, on a quarterly basis), to reflect the latest evidence on actual typical consumption. This means the savings from reduced consumption would, on average, pass back to HMT.
- ^ Households who are slower than average to reduce consumption may end up paying more. But such a dynamic would encourage a sort of race between households to cut back wherever they reasonably could. It would also incentivise government to throw everything it had at reducing demand and thereby its own bill. Something it has not shown huge appetite for to date.
- ^ This economic estimate of 30% reductions would almost certainly require behaviour changes and some loss of comfort e.g. lower thermostats. Not all households will want to do this. The key point is that choices should ultimately be up to householders themselves. Give them the cash and they can decide whether to spend it all on highly priced energy.
- ^ Saving energy in residential buildings: the role of energy pricing - PMC (nih.gov) and Annex_D_Gas_price_elasticities.pdf (publishing.service.gov.uk)