Price Discrimination – Scottish Green Energy
The European Commission got involved with the UK government, asking them to justify why renewable energy companies in the north of Scotland have to pay much more in order to transmit power, whereas those in the south of England are subsidised. This is price discrimination in action, as one buyer has to pay for the costs by themselves, whereas an identical company (albeit situated in a different part of the UK) is being subsidised.
The reasoning that the government has given for this price discrimination is that companies with generators a long distance away from the main centres of demand have to pay more, as their energy has to cover more ground.
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