Can capping energy use make people happier?

We all know that the way we use resources today is unsustainable, transgressing planetary boundaries and putting the whole of human society at risk. However, the use of resources as well as environmental and health challenges arising from it are not shared equally in today’s society.

1.2 billion people across the world still lack access to electricity, while a further 2.8 billion have no choice other than traditional biomass for cooking and heating. Using traditional biomass causes indoor air pollution, which can easily result in different kinds of mostly respiratory health problems. Furthermore, the most negative environmental consequences arising from resource use, such as air, water and soil pollution directly and disproportionately impact the marginalized people.

Whilst it’s clear that the challenges of resource use and inequality are linked, they have not traditionally been connected across scientific disciplines – as one group of scientists call attention to how humanity overuses the globe’s resources, others warn of rising inequalities.

Unfortunately, policy makers have not listened much to any of these ringing bells. However, two new policy toolkits developed by think-tanks in Hungary and in the UK aim to address the challenges of dependency on non-renewable energy sources and social inequalities at the same time.

Both approaches are based around the idea of energy capping – putting a limit or ‘cap’ on the non-renewable energy consumption of a country/region and then essentially rationing out the energy available under the cap. Under the plan, the cap would decrease year by year until it reaches a level that can be entirely generated using renewable and clean sources. The tools work by offering energy units to every person to give them a ‘fair’ share of energy to use.

People who consume under their share may trade leftover units with people who want to consume more than their fair share. Rationing is intended to guarantee a minimum share for all, and at the same time, the option to legally trade (within a capped system) allows people to make choices about their consumption.

A quick look at the social benefits of such schemes suggests energy-capping proposals have the potential to deliver not only environmental sustainability but also societal well-being (defined as a complex combination of a person's physical, mental, emotional and social health factors that is strongly linked to happiness and life satisfaction).

Both the Hungarian and the UK systems favor people who consume fewer units of energy than they’ve been given under the cap. They can profit from selling their unused units to people who want to consume more than their share. However, due to the gradually decreasing limit, people who consume more than their fair share are forced to use less in the long run, by investing in energy efficiency or changing their behaviour and attitudes towards consumption.

The British system favors marginalized people who, according to the UK energy patterns, use less energy than the rich. At the same time, the tool developed in Hungary aims to open up opportunities for marginalized people by providing interest-free loans and professional advice on energy consumption.

What’s more, energy-capping tools create jobs in the construction, renewable energy and energy efficiency sectors, as well as for advisors who would provide recommendations on reducing energy use for citizens affected by the schemes.

Both systems aim to reduce household energy bills. Last but not least, job creation and income from trading energy units would enhance development and spending on environmentally friendly services, since the quota money has to be spent on certified socially and environmentally friendly products.

However, just how these kinds of tools could enhance the overall well being of society, has not been a focus for scientific communities or policy makers to date. Changing this situation will require emphasizing the multi-sectoral benefits the proposed schemes would deliver. We urgently need to re-adjust our economic model to one that functions within environmental limits and benefits the people. The energy sector is a great place to start.