LONDON – This week, President Bush and his Cabinet members are going around the country touting the president’s “new” energy policies. They might do well to visit London to see how some consistent energy policies might work.

In his State of the Union address, Mr. Bush stated: “We have a serious problem: America is addicted to oil.” Hence, President Bush has developed an “Advanced Energy Initiative” designed to reduce dependence on imported petroleum. It includes large-scale government spending on research and development of alternative energy sources such as ethanol and solar energy and subsidies for noncompetitive energy sources.

President Carter had a similar program 30 years ago that succeeded only in spending federal funds. Whether reducing petroleum consumption is necessary is subject to debate, but new federal spending programs will not achieve such reduction.

There is only one effective means to reduce any form of consumption: a tax. In Britain, less petroleum is consumed per capita than in America in large part because of high taxes. Gasoline prices exceed $6 a gallon. The difference in the price of retail gasoline in Britain and America is almost entirely due to taxes. Gasoline is one of the most heavily taxed commodities in America, but the taxes pale in comparison to those in Britain (and much of the rest of the world).

In addition to many sanctimonious consequences (they’re good for the environment, domestic industries, and other worthy causes), petroleum taxes raise substantial revenues for the government. Most consumers suffer due to high petroleum prices, but governments with high energy taxes have the satisfaction of burgeoning tax revenues, self-proclaimed moral authority, and reduced petroleum consumption. Economies without stiff energy taxes may have greater virtues, but artificially low petroleum consumption is not among them.

There are other admirable qualities to British energy policy. Consumers have choices in electricity and natural gas services that Americans can only dream about. In much of London, at least 18 different companies compete to offer natural-gas services and at least 23 offer electricity services, all connected to a national grid. Some of these are well-recognized utilities, such as British Gas or Scottish Power and the French utility EDF Energy, while others are pure resellers, such as the Sainsbury’s supermarket chain.

All the companies offer several plans for energy services that include various fee arrangements, from long-term fixed prices to variable spot market prices to “green” plans for the environmentally sensitive. The unregulated rates and fees change with market conditions, but they are publicly posted and compared at many Web sites such as www.uswitch.com. This Web site receives a small commission for successful switches between competing electricity, natural gas, broadband, and other carriers. The ability to switch service providers in England in response to available lower prices is a few mouse clicks away.

Of course, many states have experimented with energy deregulation, most notably New York. Consolidated Edison is the incumbent provider in New York City, but, in theory, it faces competition from nine other residential electricity providers and 17 other residential natural-gas providers. Some competitive providers are other public utilities from New York, others are energy companies from across the country, and still others are resellers. (Residential energy markets are far less competitive in other states. Montgomery County in Maryland, for example, has but two choices for either electricity or natural gas.)

For a residential consumer who might be dissatisfied with Consolidated Edison, however, finding an alternative is not simple. Neither the New York Public Service Commission nor most of the energy companies list rates at their Web sites. Instead, Web sites invite potential consumers to e-mail private consumer information in exchange for a rate quote. Partly because of the difficulty of comparison shopping for residential energy services, only 116,000 Consolidated Edison residences, or 4.6% of the total, changed providers in December 2005.

Some say America consumes too much foreign petroleum. If so, we need to take a realistic look at how to reduce consumption rather than resurrecting the policies of a generation ago. They failed because they sought to distort energy supplies rather than permit markets to respond efficiently to the benefit of all willing buyers and sellers. For efficient residential energy markets, we could do worse than copying Britain.

A former FCC commissioner, Mr. Furchtgott-Roth is president of Furchtgott-Roth Economic Enterprises. He can be reached at hfr@furchtgott-roth.com.