In the paper, the ASI, a free market think tank, said that new features such as smart-meters and “microgrids” can “can revolutionise old models of energy distribution and pricing, in the same way that apps like Uber are disrupting traditional models of transport”. The ASI added that regulators should “encourage experimentation” rather than cutting off new providers or technologies.
“Regulating the market too heavily – often justified by claims that consumers are being ‘ripped off’ or overwhelmed by the number of tariffs available – closes down consumer experimentation and prevents technological and economic progress, which keeps energy prices high,” the think tank said.
Commenting on the report, its author Lynne Kiesling added: “Innovation in the production of energy is steaming ahead, with rapid and steady improvement in the effectiveness of renewables like solar, and many changes that make existing fuels cleaner and cheaper to use.”
“But distribution has enjoyed less in the way of disruption,” Kiesling said. “If the government wants a more fluid, consumer-centred, and futuristic energy distribution network, it should look at carefully deregulating supply.”