On 12 July 2011 the U.K. Government published ‘Planning our electric future: a White Paper for secure, affordable and low-carbon electricity’. Plans to reform energy policy are under debate around the world, e.g. Australia is planning to introduce a carbon tax that doesn’t include transport fuels.
Many such policies do focus on power plants, which comes at the risk of overlooking the potential for batteries to be charged at off-peak hours and then to feed their surplus power back into the grid when needed most.
Feebates can be tailored to most effectively accomplish desired shifts, such as electrification of transport and cleaning up of power generation. A comprehensive policy can include feebates with fees on fossil fuel and polluting facilities, funding rebates on local transport electrification and clean energy programs.
Details can be decided locally, provided the area does reach agreed emission reduction targets independently. Such feebates can be implemented on a budget-neutral basis, allowing them to be implemented with minimal changes to existing taxes and support programs. Within the chosen framework, market mechanisms can further decide what works best.
The image below is an example of how feebates can be implemented to achieve a shift towards clean energy and electric transport. The image shows how several fees and rebates can be combined in a mix of incentives and disincentives, which will minimize leakage that would occur with policies that provide either incentives only, or disincentives only, or that focus only on energy, respectively only on facilities and infrastructure that use or produce energy.