“We over-tax electricity compared to fossil fuels. We essentially have higher tax rates and levies and policy costs on the electricity bill. … And fossil fuels get a bit of a free ride.”

Zero: The Climate Race · Climate & Energy · November 2026

Context

The host asked what governments can do now to make electricity cheaper so people see the savings from electrifying. Taxation is the first lever Rosenow names, ahead of network costs and gas-set wholesale prices.

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Transcript

Zero: The Climate Race Around 20:25 into the episode

Speaker 1

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Akshat Rathi

…it may not be. But getting to that future requires you to have political buy-in from people to electrify, which at the cost that prices are today doesn't seem viable. What can governments really do right now to make electricity cheap and show the savings that may come from electrification today?

Jan Rosenow

There's a number of things. Let me start perhaps with taxation, because that's kind of an obvious area where governments can quite quickly decide to lower the cost of electricity. We know that in many countries, we over-tax electricity compared to fossil fuels. We essentially have higher tax rates and levies policy costs on electricity bill. That's also the case in the UK, but elsewhere as well. And fossil fuels get a bit of a free ride. So that rebalancing of taxation and levies can, in some cases, make a really, really significant difference to what the price of electricity is. Then you have things like network costs. That's a bit more tricky because we are paying for infrastructure that we may need for the next 10, 20, 30 years, but we need to build it now in anticipation of a rising electricity demand. So how are you…

Akshat Rathi

One aspect of this, which is sort of playing out with the Iran war and where fossil fuel prices are, sure, many consumers have looked to electric options, but a lot of governments' initial reaction has been to find other sources of fossil fuels or to subsidize energy right now because the prices…

Jan Rosenow

I think there's always a short-term scramble to solve the crisis. And that's understandable. I mean, if you're in government and you see prices shoot up by maybe three, four, five, or 10 times even in 2022, that's what we've seen in the gas markets in Europe. You have to react. And you can't just…

Akshat Rathi

In terms of Europe, the biggest share of emissions tends to be heating homes and buildings with natural gas. I know you have looked at electrification of heating very closely. The obvious solution is heat pumps, but there are success stories and then there are failures across Europe when you look…

Speaker names come from our own diarization. The position is estimated from where the line sits in the episode.

More from Zero: The Climate Race

“I've always been rather skeptical of target metrics. They usually get adopted by politicians who are no longer in power when these targets kick in, and then they're quietly abandoned.” — Jan Rosenow, Zero: The Climate Race

“Without electricity we would not have a functioning energy system, and that includes the fossil fuel energy system. Your gas boiler needs electricity to run. When you get your car fueled at the pump, there's an electric pump that pumps the petrol or the diesel into your car. The water system would fail. The whole society depends on electricity.” — Jan Rosenow, Zero: The Climate Race