Energy Rewards are a way for consumers of energy to fund the generation and distribution of the energy they consume. Rewards are a discount on future energy consumption. The size of the discount depends on the length of time held and the value of the Reward. Typically the discount is fixed, and the value of the Reward increases with inflation. They replace traditional loans and save the cost of interest. This saving takes the form of discounted prices.
Customers earn Rewards from their behaviour. The most common behaviour is the prepayment of energy. Others are off-peak consumption and feed-in energy from solar panels or battery storage.
Distributors issue the Rights to Buy Energy Rewards to all customers. Rights and Rewards are both transferable. The distributor runs a secondary market for both. Money raised from the sale of Rights or Rewards to non-consumers should be used to reduce any personal debt. The reason is that the discounts come from interest savings from utilising community credit created by the promise to purchase future energy.
Distributors will have lower churn as Reward holders get the best return for their Rewards by purchasing energy from the distributor.
Generators lock in distributors by selling them future production at a discount. The distributors get the funds by selling Energy Rewards to their customers. Generators of long-lasting renewable energy with low operating costs have lower finance costs and long-term customers. They become competitive compared to high operating generators of energy.
The total savings to the community of customers, distributors and generators is the cost of interest on traditional loans and the cost of inflation.
The cost of operating a Rewards system is the cost of payments paid with Rewards.
Existing generators of energy, grid operators and distributors can all use Rewards to replace loans.