Friday 14 September 2007

Only in the UK! A poor pensioner pays the same to fill her kettle as her neighbour pays to water a huge garden. It seems ludicrous that energy and water suppliers would reward those who consume more and are responsible for releasing more carbon into the environment and depleting freshwater resources, but this is exactly what is happening and it is careful households who are paying the price financially.

Current energy and water tariff structures contradict Government commitments to reduce CO2 emissions and to conserve freshwater resources, by rewarding excessive and wasteful use and unfairly penalising those who consume the least water and energy. The perverse structure of pricing tariffs for electricity, gas and water means that it is currently cheaper per unit for households to use more, offering little incentive for them to reduce their Ecological Footprint and reducing the chances of Scotland meeting its climate emissions reduction targets.

Dr Richard Dixon, Director of WWF Scotland said: "It is clearly bonkers that the current pricing system rewards those whose emissions are the highest by offering them the lowest energy bills per unit used. We are over-consuming the planet's resources at an ever-increasing rate and this cannot continue. A far more radical approach to household energy and water demand management is needed. A shake-up of the energy and water pricing systems would benefit the worst off in society and produce significant reductions in climate change emissions and ease pressure on freshwater sources."

With household demand for water, electricity and gas rising, the introduction of smart meters and more water meters, and an overhaul of the dated tariff pricing structures would reduce household energy demand and related CO2 emissions, help reverse the existing and ongoing damage to our rivers and wetlands, and provide a fairer system where utility bills reflect the full environmental costs of excessive and wasteful energy and water use by households.

In two new reports published this week, WWF found that Increasing Block Tariffs (IBT's), if carefully designed, could provide a viable solution, encouraging significant reductions in household energy and water use, and potentially rewarding some low income households struggling to pay their bills. Under an Increasing Block Tariffs structure, the unit price of energy and water increases the more is used, providing both relatively cheap basic energy and water for essential purposes and strong incentives to reward efficient use.

One of the three main IBT models considered for electricity and gas, showed reductions in CO2 emissions of almost 10 million tonnes annually from the household sector are possible. The water tariffs report similarly showed the introduction of water meters and IBT's could also lead to a reduction in water demand in the UK of at least 10% with reductions of up to 30% in peak summer demand when water availability is at its lowest.

WWF-UK is now calling on the Government to take the lead and seriously consider the introduction of a new tariff pricing structure that will change the way we use energy in our homes so that we live within the Earth's ecological and natural resource limits. The current system is failing the environment and stronger regulation is urgently needed to help reduce water demand and carbon emissions from the household sector, as well as tackling fuel poverty.