The Distributional Effects of Gas Price Volatility and Potential Policy Mitigation

Concerns are growing in the UK and other European countries about the social and economic implications of recent unprecedented increases in the level and volatility of energy prices. This raises questions about how governments and other economic actors might mitigate these negative impacts over the short- and long-term. Policy measures and interventions, including pressure to reduce green levies and taxes, need to be evaluated from the perspective of legally binding Net Zero objectives. On the other hand, growing calls for a ‘just transition’ require that the costs and disruptions of the Net Zero transition are allocated ‘fairly’ across economic and social groups. Our research project considers the implications of such transition for consumers with different social and economic positions, including levels of income and wealth. As significant policy and regulatory interventions are likely to be required to deal with longstanding economic and social issues in the energy sector, we also consider the potential changes in the roles of government and the regulator in implementing the energy transition. Concerns are growing in the UK and other European countries about the social and economic implications of recent unprecedented increases in the level and volatility of energy prices. This raises questions about how governments and other economic actors might mitigate these negative impacts over the short- and long-term. Policy measures and interventions, including pressure to reduce green levies and taxes, need to be evaluated from the perspective of legally binding Net Zero objectives. On the other hand, growing calls for a ‘just transition’ require that the costs and disruptions of the Net Zero transition are allocated ‘fairly’ across economic and social groups. Our research project considers the implications of such transition for consumers with different social and economic positions, including levels of income and wealth. As significant policy and regulatory interventions are likely to be required to deal with longstanding economic and social issues in the energy sector, we also consider the potential changes in the roles of government and the regulator in implementing the energy transition. As a conclusion to a research project supported by UKERC, and thus ultimately by UKRI, this CCP organised webinar will bring together studies performed at Queen Mary University of London, Sheffield Hallam University, University of Nottingham, University of Sheffield, and UEA’s Centre for Competition Policy. Researchers will present the headline results of their recent UKERC research, raising awareness and impact of their findings. These will interest researchers, practitioners and policymakers. The research team kindly acknowledges the support of UKERC, itself funded by UK Research and Innovation, Energy Programme, by Engineering and Physical Sciences Research Council, Natural Environment Research Council and Economic and Social Research Council. AGENDA 00:00:00 Sean Ennis, Centre for Competition Policy and Norwich Business School, University of East Anglia 00:01:16 Monica Giulietti, University of Nottingham - Introduction 00:04:30 Monica Giulietti, University of Nottingham - Distributional issues in the energy sector 00:21:21 Andrew Burlinson, University of Sheffield - Don’t switch, can’t switch: The impact of the energy price crisis on UK 00:38:31 Michael Harker, Queen Mary University of London and Paula Kohn, Sheffield Hallam University - Energy regulation and navigating the net zero transition 00:55:40 Sean Ennis, University of East Anglia - Comments and questions, including from NEA