Marginal pricing breaks when wind and solar dominate. These sources have zero fuel costs, which suppresses wholesale prices but doesn't automatically lower the monthly bill for a struggling family. To fix this, we can use Contracts for Difference (CfDs). CfDs give generators a guaranteed price, removing the gamble of the spot market. This stability lets regulators set specific social tariffs that pass savings directly to consumers.
P2P trading offers a different route. By using localized grids, communities trade surplus energy without a utility company skimming a profit. It cuts out the middleman.
Then there is Average Cost Pricing. Instead of the most expensive plant setting the rate, the total cost is divided by total output. This prevents the "missing money" problem and keeps prices predictable.
We also have to rethink network fees. Many utilities charge per kilowatt-hour, which hits the poor hardest. Moving to flat access fees ensures that infrastructure costs don't penalize low-energy users. This shift makes the transition to net zero a matter of equity rather than just engineering.
