Energy and Environment

Energy price controls do nothing to encourage energy conservation

The IEA’s Chief Operating Officer and Energy Analyst Andy Mayer has been quoted in The Times on the proposed energy price freeze.

Highlighting that price freezes will encourage households not to conserve fuel this winter, the article quotes Andy describing the freeze as “middle class welfare on steroids”.

High prices signal to producers that more energy sources are required, but also signal to consumers that existing supply needs to be conserved. By distorting that signal, the price freeze will allow better off households to consume more energy at low cost. The article quotes Andy arguing that “it will mean future taxpayers subsidising hot tubs, heating swimming pools and cooling wine cellars.”

The full article can be read here.