International
Why the ‘energy price cap’ is confusing – and how it could be better communicated
There never was a ‘maximum bill of £2,500’.
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If you thought energy bills in Britain were capped at £2,500, you are not alone. Even Prime Minister Liz Truss recently made the same mistake, incorrectly claiming that no household would pay more.
What Britain has actually done, in common with many other countries facing an energy crisis this winter, is cap the price of units of energy – the amount you pay per watt of electricity or gas. An energy bills support scheme now caps electricity and gas prices at 34p per kilowatt-hour (kWh) and 10.3p/kWh respectively.
However, the way this has been communicated has led to widespread confusion. Importantly, there is no cap on overall bills – if you use lots of energy, you will still have a large bill, albeit less than without a cap.
Yet rather than express the interventions as a cap on unit costs, there has been a tendency to refer to the average cost of energy, per household, per year. For instance, for an average household in the UK, the latest cap equates to around £2,500 for a whole year. That meant the price cap is often reported as £2,500 per year – especially in headlines and in short news clips, when space and time are short.
Such reports perhaps explain why Truss and others thought the figure is a maximum, not an average. In response, businesses, charities and government agencies have launched public communications campaigns to stress that bills will depend on usage.
People are assumed to be energy-illiterate
Besides the waste of energy and effort caused in the near term, this exemplifies a broader, problematic approach to public engagement when it comes to energy, about which the average citizen is assumed to be largely illiterate. There is an assumption held by politicians and the media, and not helped by those in the industry, that energy is a highly technical issue, and units such as kWs and kWhs are beyond the comprehension and interest of the general public.
This assumption is self-fulfilling. It also goes against the need for greater public engagement on issues of energy and climate change, and related concepts such as efficiency and sufficiency (not using any more energy than needed) that will be crucial if the transition to net-zero emissions is to be inclusive and just.
Energy doesn’t have to be complicated. Like any major commodity and essential service, there are various technical aspects relating to generating technologies, electricity transmission and so on. But as a resource that underpins everyday life, it is also a regular topic of conversation. Meaningful public engagement must be underpinned by accessible language and relatable concepts, but it doesn’t need to avoid any technical information.
During the COVID pandemic, technical concepts like R (reproduction) numbers and infection risk factors were regularly communicated to the public, which helped encourage the widespread behaviour change needed to control the pandemic. In the case of the UK government’s energy price caps, attempts to keep things simple has backfired, generating misinformation and widespread confusion.
People are already engaged
While providing information is important, what is needed are more varied modes of engagement. This should begin with the observation that people are already engaged with energy systems in the course of everyday life, have many diverse capabilities, and have a critical role to play in achieving net zero.
What you know about energy probably comes through everyday experience, rather than technical detail. For instance, people tend to categorise appliances by function, such as cooking or entertainment, rather than by energy consumption.
We should build on this, without dumbing down how energy is discussed in the media. Infographics such as the one below produced by Eurostat can help improve understanding about where most energy is used in the home, and help people to focus on where they might make savings (no, it’s probably not worth unplugging your phone charger).
Our research shows that most people in the UK agree that people need to change their domestic energy use to tackle climate change, while the link between energy and emissions is broadly understood. We also find strong support for phasing out gas boilers, and for many other net zero policies that would require behaviour change.
Support for these measures tends to increase when people are given accessible information and time to think about different options, for example, as part of moderated discussions between a representative sample of the population, known as citizens’ assemblies.
The report from the UK Climate Assembly emphasised the need for education, fairness and choice to underpin the path to net zero. When it comes to the price cap, people don’t want to be condescended to, but provided with the information they need to fully understand what the government is doing to help them.
Sam Hampton receives funding from the Economics and Social Research Council, the UK Energy Research Centre, and Innovate UK.
Jan Rosenow is affiliated with the Regulatory Assistance Project.
Lorraine Whitmarsh receives funding from the Economic and Social Research Council and the European Research Council.
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International
You can now enter this country without a passport
Singapore has been on a larger push to speed up the flow of tourists with digital immigration clearance.
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In the fall of 2023, the city-state of Singapore announced that it was working on end-to-end biometrics that would allow travelers passing through its Changi Airport to check into flights, drop off bags and even leave and exit the country without a passport.
The latter is the most technologically advanced step of them all because not all countries issue passports with the same biometrics while immigration laws leave fewer room for mistakes about who enters the country.
Related: A country just went visa-free for visitors with any passport
That said, Singapore is one step closer to instituting passport-free travel by testing it at its land border with Malaysia. The two countries have two border checkpoints, Woodlands and Tuas, and as of March 20 those entering in Singapore by car are able to show a QR code that they generate through the government’s MyICA app instead of the passport.
Here is who is now able to enter Singapore passport-free
The latter will be available to citizens of Singapore, permanent residents and tourists who have already entered the country once with their current passport. The government app pulls data from one's passport and shows the border officer the conditions of one's entry clearance already recorded in the system.
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While not truly passport-free since tourists still need to link a valid passport to an online system, the move is the first step in Singapore's larger push to get rid of physical passports.
"The QR code initiative allows travellers to enjoy a faster and more convenient experience, with estimated time savings of around 20 seconds for cars with four travellers, to approximately one minute for cars with 10 travellers," Singapore's Immigration and Checkpoints Authority wrote in a press release announcing the new feature. "Overall waiting time can be reduced by more than 30% if most car travellers use QR code for clearance."
More countries are looking at passport-free travel but it will take years to implement
The land crossings between Singapore and Malaysia can get very busy — government numbers show that a new post-pandemic record of 495,000 people crossed Woodlands and Tuas on the weekend of March 8 (the day before Singapore's holiday weekend.)
Even once Singapore implements fully digital clearance at all of its crossings, the change will in no way affect immigration rules since it's only a way of transferring the status afforded by one's nationality into a digital system (those who need a visa to enter Singapore will still need to apply for one at a consulate before the trip.) More countries are in the process of moving toward similar systems but due to the varying availability of necessary technology and the types of passports issued by different countries, the prospect of agent-free crossings is still many years away.
In the U.S., Chicago's O'Hare International Airport was chosen to take part in a pilot program in which low-risk travelers with TSA PreCheck can check into their flight and pass security on domestic flights without showing ID. The UK has also been testing similar digital crossings for British and EU citizens but no similar push for international travelers is currently being planned in the U.S.
stocks pandemic link testing singapore uk euInternational
This country became first in the world to let in tourists passport-free
Singapore has been on a larger push to speed up the flow of tourists with digital immigration clearance.
Share this:
In the fall of 2023, the city-state of Singapore announced that it was working on end-to-end biometrics that would allow travelers passing through its Changi Airport to check into flights, drop off bags and even leave and exit the country without a passport.
The latter is the most technologically advanced step of them all because not all countries issue passports with the same biometrics while immigration laws leave fewer room for mistakes about who enters the country.
Related: A country just went visa-free for visitors with any passport
That said, Singapore is one step closer to instituting passport-free travel by testing it at its land border with Malaysia. The two countries have two border checkpoints, Woodlands and Tuas, and as of March 20 those entering in Singapore by car are able to show a QR code that they generate through the government’s MyICA app instead of the passport.
Here is who is now able to enter Singapore passport-free
The latter will be available to citizens of Singapore, permanent residents and tourists who have already entered the country once with their current passport. The government app pulls data from one's passport and shows the border officer the conditions of one's entry clearance already recorded in the system.
More Travel:
- A new travel term is taking over the internet (and reaching airlines and hotels)
- The 10 best airline stocks to buy now
- Airlines see a new kind of traveler at the front of the plane
While not truly passport-free since tourists still need to link a valid passport to an online system, the move is the first step in Singapore's larger push to get rid of physical passports.
"The QR code initiative allows travellers to enjoy a faster and more convenient experience, with estimated time savings of around 20 seconds for cars with four travellers, to approximately one minute for cars with 10 travellers," Singapore's Immigration and Checkpoints Authority wrote in a press release announcing the new feature. "Overall waiting time can be reduced by more than 30% if most car travellers use QR code for clearance."
More countries are looking at passport-free travel but it will take years to implement
The land crossings between Singapore and Malaysia can get very busy — government numbers show that a new post-pandemic record of 495,000 people crossed Woodlands and Tuas on the weekend of March 8 (the day before Singapore's holiday weekend.)
Even once Singapore implements fully digital clearance at all of its crossings, the change will in no way affect immigration rules since it's only a way of transferring the status afforded by one's nationality into a digital system (those who need a visa to enter Singapore will still need to apply for one at a consulate before the trip.) More countries are in the process of moving toward similar systems but due to the varying availability of necessary technology and the types of passports issued by different countries, the prospect of agent-free crossings is still many years away.
In the U.S., Chicago's O'Hare International Airport was chosen to take part in a pilot program in which low-risk travelers with TSA PreCheck can check into their flight and pass security on domestic flights without showing ID. The UK has also been testing similar digital crossings for British and EU citizens but no similar push for international travelers is currently being planned in the U.S.
stocks pandemic link testing singapore uk euInternational
Analysts issue unexpected crude oil price forecast after surge
Here’s what a key investment firm says about the commodity.
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Oil is an asset defined by volatility.
U.S. crude prices stood above $60 a barrel in January 2020, just as the covid pandemic began. Three months later, prices briefly went negative, as the pandemic crushed demand.
By June 2022 the price rebounded all the way to $120, as fiscal and monetary stimulus boosted the economy. The price fell back to $80 in September 2022. Since then, it has bounced between about $65 and $90.
Over the past two months, the price has climbed 15% to $82 as of March 20.
Bullish factors for oil prices
The move stems partly from indications that economic growth this year will be stronger than analysts expected.
Related: The Fed rate decision won't surprise markets. What happens next might
Vanguard has just raised its estimate for 2024 U.S. GDP growth to 2% from 0.5%.
Meanwhile, China’s factory output and retail sales exceeded forecasts in January and February. That could boost oil demand in the country, the world's No. 1 oil importer.
Also, drone strokes from Ukraine have knocked out some of Russia’s oil refinery capacity. Ukraine has hit at least nine major refineries this year, erasing an estimated 11% of Russia’s production capacity, according to Bloomberg.
“Russia is a gas station with an army, and we intend on destroying that gas station,” Francisco Serra-Martins, chief executive of drone manufacturer Terminal Autonomy, told the news service. Gasoline, of course, is one of the products made at refineries.
Speaking of gas, the recent surge of oil prices has sent it higher as well. The average national price for regular gas totaled $3.52 per gallon Wednesday, up 7% from a month ago, according to the American Automobile Association. And we’re nearing the peak driving season.
Another bullish factor for oil: Iraq said Monday that it’s cutting oil exports by 130,000 barrels per day in coming months. Iraq produced much more oil in January and February than its OPEC (Organization of Petroleum Exporting Countries) target.
Citigroup’s oil-price forecast
Yet, not everyone is bullish on oil going forward. Citigroup analysts see prices falling through next year, Dow Jones’s Oil Price Information Service (OPIS) reports.
More Economic Analysis:
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The analysts note that supply is at risk in Israel, Iran, Iraq, Libya, and Venezuela. But Saudi Arabia, the UAE, Kuwait, and Russia could easily make up any shortfall.
Moreover, output should also rise this year and next in the U.S., Canada, Brazil, and Guyana, the analysts said. Meanwhile, global demand growth will decelerate, amid increased electric vehicle use and economic weakness.
Regarding refineries, the analysts see strong gains in capacity and capacity upgrades this year.
What if Donald Trump is elected president again? That “would likely be bearish for oil and gas," as Trump's policies could boost trade tension, crimping demand, they said.
The analysts made predictions for European oil prices, the world’s benchmark, which sat Wednesday at $86.
They forecast a 9% slide in the second quarter to $78, then a decline to $74 in the third quarter and $70 in the fourth quarter.
Next year should see a descent to $65 in the first quarter, $60 in the second and third, and finally $55 in the fourth, Citi said. That would leave the price 36% below current levels.
U.S. crude prices will trade $4 below European prices from the second quarter this year until the end of 2025, the analysts maintain.
Related: Veteran fund manager picks favorite stocks for 2024
stimulus economic growth pandemic dow jones stocks fed army trump gdp stimulus oil iran brazil canada european russia ukraine china
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