The electrical pricing is setting old people up to not use the air conditioning that they may truly need at some point to save their life.
Steeply tiered electricity costs can nail people with electricity bills of $200-500 or more in months where they use several hours of air conditioning in one day in California and South Korea and many other countries.
A timely article by Willis.
“The wealthiest of our households spend about 6% of their income on energy, while the poorest spend just over 40% of their income on energy.
And of course, this means if energy costs go up by say 25%, the rich will get a bite out of their income of 1.5%. But the poor will get an additional bill for no less than 10% of their income …
Sadly, in reality it is worse than that. At the poor end of the spectrum, there is very little slack in the budget. There is a concept in economics called “disposable income”, money that you have at the end of the month that isn’t already spoken for to pay some bill or other.
People living on the economic bottom floor not only don’t have disposable income, they never heard of disposable income. Every dollar is spoken for, and often over-promised.”
Is this a surprise? Of course the poor will get screwed.
Britain’s increasing reliance on “intermittent” renewable energy means that the country is facing an unprecedented supply crisis, a senior Ofgem executive has warned.
Andrew Wright, a senior partner at Ofgem and former interim chief executive, warned that households could be forced to pay extra to keep their lights on while their neighbours “sit in the dark” because “not everyone will be able to use as much as electricity as they want”.
He warned that in future richer customers will be able to “pay for a higher level of reliability” while other households are left without electricity.
Mr Wright said that because Britain has lost fuel capacity because of the closure of coal mines, there is now “much less flexibility” for suppliers.
In a stark warning about the future of energy supply in Britain, Mr Wright said that consumers could be forced to pay more if they want to ensure they always have power.
“At the moment everyone has the same network – with some difference between rural and urban – but this is changing and these changes will produce some choices for society,” he told a recent conference.
“We are currently all paying broadly the same price but we could be moving away from that and there will be some new features in the market which may see some choose to pay for a higher level of reliability.