Compare Energy Prices Across The Globe

Compare Energy Prices Across the Globe

by

Laura Ginn

When you compare energy prices for countries across the globe, you quickly realize that there are several factors that complicate any comparison that you might make. Among these factors are energy production costs, regulations, natural conditions and political and social factors. The sources of energy for different countries also figures into variations in average energy prices in various countries. This is especially true with electricity.

Sources of Electric Power

In much of the world, residential consumers pay a much higher rate on average than commercial or industrial customers. The sources of energy for different countries also affect electricity rates for all customers, but especially for residential consumers. In general, countries that are more energy impendent or which have a broader mix of sources for electric power have lower electricity rates.

Countries with a low diversity of energy mix in general tend to have higher prices for electricity than other countries. Specifically, countries that source more than one third of their electricity from natural gas tend to have higher electric rates than other countries across the globe. This situation applies to many countries in Europe, which import large quantities of natural gas from Russia.

Countries with a high diversity of energy mix are able to provide electricity at a lower rate to their residents, on average. An energy mix includes coal, natural gas, renewable energy sources and nuclear energy results in medium range prices for electricity. The lowest electricity rates are found in countries that have a high energy mix and which draw their energy from North American sources.

In the United States, the majority of electricity is generated by power plants fueled by fossil fuels, especially coal. Because coal is abundant and readily available in the United States, the price for electric power is comparatively inexpensive. However, coal has fallen out of favor in many areas, because of the high rate of carbon emissions generated when coal is burned. As a result, more regions in the United States are moving toward renewable energy sources such as wind and solar power.

Energy Production Costs

Energy production costs naturally figure into the prices that consumers pay for electricity. Because petroleum has been extracted and refined for more than a century, it is a mature industry. Many of the expenses associated with petroleum production have been amortized by decades of use. The same factors apply to coal. As a result, electricity generated from fossil fuels, especially coal, is often less expensive than electricity generated by other sources.

This disparity is especially relevant where the production of electricity from renewable energy sources is concerned. Because the technology for energy sources such as solar and wind power is still being developed, electricity produced from renewable energy sources is comparatively high. However, as technology matures, these energy sources hold the power to provide inexpensive and limitless electricity for consumers across the globe. At the same time, production of energy from fossil fuels will likely become more expensive as reserves are depleted. As a result, the disparity of prices between electricity from renewable energy and energy from fossil fuels will gradually decrease.

Regulations

Regulations imposed by national, regional or local governments also impact the price of electricity. In some countries, energy prices are subsidized by the government, allowing citizens of those countries to purchase electricity and other utility services at prices below the cost of production. In other countries, high tariffs and taxes place a hefty premium on energy prices; residents of those countries pay higher prices for utility services.

Political and Social Factors

When your compare energy prices for countries across the globe, it would be a serious mistake to omit a consideration of political and social factors. For instance, electricity prices in the European Union are to a certain degree subject to the whims of Russia. Oil producing regions across the world are often located in politically unstable areas, such as the Middle East. Oil from tar sands in Canada and natural gas reserves in the United States represent potentially vast sources of energy in areas that enjoy political stability. However, the extraction and refinement of these energy sources has been met with resistance from environmentalists and others who are highly skeptical of the reliability of technology associated with production of energy from these sources.

Laura Ginn

knows that there is more to the price that we pay for our gas and electricity than merely the cost of production. She also knows that it makes sense to

compare energy prices

using the price comparison website uSwitch in order to find the best energy deal.

Article Source:

ArticleRich.com