Wednesday, September 28, 2022

The effectiveness of incentives to save electricity in Japan is questionable

The Japanese government is planning to launch a points program to encourage electricity savings to prevent power cuts.

Adequate public funds will be used for this, but whether the incentives will prove effective is rather questionable.

Save electricity to avoid failures

The points program envisages that saving electricity should lead to reduction in consumer bills. You collect points, which can then be used to reduce bills in addition to the money saved.

Some electricity suppliers already offer a similar system, which should prevent the electricity grid from becoming overloaded with summer heat.

The government plans to distribute 2,000 yen (about 14.60 euros) points per household for its system. Businesses can earn points up to 200,000 yen.

180 billion yen (a. 1.3 billion euros) is to be spent on the public money system.

However, it is questionable whether this is a sufficient incentive for people to save electricity, as it can waste taxpayers’ money with practically no effect.

The system is not designed to reduce consumers’ electricity consumption, but rather requires participation in the bonus program.

Benefit for electricity suppliers but not for consumers

In addition, this could mean that if many consumers save electricity, electricity suppliers may avoid buying electricity from other suppliers to save money. However, in such a case it is not expected that these savings will be passed on to the customers. Moreover, the premium for the customers is very less.

So experts are certain that the government is acting in haste and the plan needs an overhaul to really take effect.

Nation World News Desk
Nation World News Desk
Nation World News is the fastest emerging news website covering all the latest news, world’s top stories, science news entertainment sports cricket’s latest discoveries, new technology gadgets, politics news, and more.
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