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If you need to get your power from elsewhere. This raises several issues: - This increases demand on other sources of energy. If there is a sudden change in de
by extraisland 1y ago
If you need to get your power from elsewhere. This raises several issues:
- This increases demand on other sources of energy. If there is a sudden change in demand you have a price spike. This leads to an increase in price to consumers.
- If the grid also has to be re-balanced. This has a financial cost in of itself. If the grid can't be re-balanced you can have blackouts. Blackout can potentially kill people, it effects business etc.
- If you are getting it from other countries, this means you are reliant on another nation for your energy needs. This is a security issue. e.g. Norway threatened to ration energy exports back in 2022. This would of course increase the price.
- Energy prices have a knock affect to everything in the economy and are a significant driver of price inflation. This obvious has an adverse affect on the economy.
Subsidies are paid for via taxation. At the moment the UK is likely to increase taxation again in October as they were unable to cut benefits earlier this year. The larger the subsidies a government are paying the more money they need collect in taxation, or you have to borrow. The UK is unlikely to be able to collect much more tax, and we are borrowing a huge amount of money as it is.