Loading...
Carbon tax and household energy choices: A regional study of the UK
Khan, Abbas Alomair, Abdulrahman Abdulaziz S., Al Naim
Khan, Abbas
Alomair, Abdulrahman
Abdulaziz S., Al Naim
Type
Supervisor
Date
2026-01-10
Collections
Files
Research Projects
Organizational Units
Journal Issue
Abstract
This study examines carbon taxation’s impact on UK households’ energy choices, focusing on socioeconomic
factors and fuel substitution using household microdata in a Multinomial Logit (MNL) framework. Rural
households, reliant on costly, carbon-intensive fuels like heating oil and LPG, are significantly affected by carbon
price changes, while urban households have cheaper alternatives. Findings show that rising carbon tax increases
carbon-intensive fuel costs, prompting urban households to boost combined electricity and mains gas use from
32.8 % to 50.6 %, while reducing LPG and electricity use from 12.3 % to 6.6 %, and heating oil and electricity
from 9.7 % to 6.1 %. Conversely, rural households, facing fewer choices, turn to more expensive fuels; combined
electricity and LPG use rises from 14.1 % to 39.3 %, and electricity and heating oil use from 9.1 % to 36.1 %. This
study provides novel UK-specific insights into regional and socio-economic disparities in energy transitions under
carbon taxation. It highlights the disproportionate burden on low-income and rural households, emphasizing the
need for targeted revenue recycling, regional support, and measures to combat energy poverty. The findings offer
practical guidance for policymakers to design equitable carbon tax policies and ensure a just transition to a lowcarbon economy.
Department
Publisher
Sponsor
This work was supported by the Deanship of Scientific Research, Vice Presidency for Graduate Studies and Scientific Research, King Faisal UniversityKing Faisal University, Saudi Arabia [KFU254467]