The Gas Grab And How To Survive: What Are Alternative Soluti With attention still focused on the aftermath of vaccination campaigns and lockdowns, few imagined they’d be rocked with another searing setback to the bottom line.
But as the world crawls back out of its pandemic cocoon, demand for energy has surged and global gas providers have capitalised on the opportunity to raise prices.
The UK, which relies on gas for up to 50% of its electricity, has been especially hard hit. Households and businesses are staring a record-breaking 54% energy bill increase come April after gas prices already soared to unprecedented levels in 2021.
For 22 million UK households this translates into an average gas and electricity bill of £1,971 per year, making a well-heated home a luxury many may struggle to afford; charities are warning of an inevitable rise in destitution for people on the lowest incomes.
For Sierra Hollow, a Security Guard in Aberystwyth, past price hikes have already prompted him to consider moving somewhere more energy efficient:
“I was expecting a 50% increase, but my electric was about £35 a month and this jumped to about £75, so it was worse than I expected. For context, I live in a tiny studio.
“Since discussing my energy bill situation with friends I've found out that I'm lucky to have had my bill only double. Some friends have told me it has gotten as bad as quadrupled,” says Hollow.
For some UK factories and businesses, the energy bill hikes have been harder to stomach. Two fertiliser companies in North England have closed, some steelmakers have had to pause work during periods of peak electricity demand – factories are struggling to justify the costs of keeping the cogs turning.
Darren Jones, Utility Bridge Founder says businesses have been caught off guard, “the pressure of Covid and the uncertainty of opening and closing for hospitality has made businesses more reactive than proactive.
“The actual crunch of how much power prices have increased hasn't hit many yet. But it will. I'm hearing concern for the future, but the actual fall of business due to the cost of energy- it will happen.”
Santiago De Los Reyes, Vertus Energy Co-founder, says the current instability is “preventing companies from forecasting and preventing further damage or instability within their own operations. If you combine this with supply chain issues, expectant environmental responsibility action, and workforce disruption, you have a recipe that has the potential to cripple business.”
“The energy price rises coming this year are off the scale,” says Reg Platt, Emergent Energy CEO, “and with wider inflation pressures also buffeting the economy, many middle income families will fill the squeeze – the impact for the poorest families will be devastating.”
The government has already had to step in with a several million pound bail out to subsidise the UK plants of a US fertiliser manufacturer that produce about 60% of Britain’s food-grade carbon dioxide. Without subsidies, the energy crisis would have cascaded into a food supply crisis.
Meanwhile, smaller competitors who are less able to handle the price volatility are being squeezed out of the energy sector, corroding a decade-long government attempt to bring more diversity to the UK energy market. Some energy experts forecast the number of suppliers will shrink from 70 to just 10 by the end of the year.
To make matters worse, as Russia amasses the biggest concentration of troops since the Cold War on the Ukrainian border, and the UK, US and EU strengthen their military presence in Eastern Europe, the International Energy Agency has accused Russia of orchestrating Europe’s energy crisis by withholding up to a third of its gas exports.
Europe appears to be trapped in a worst-case scenario where energy is being used as a geopolitical weapon that demonstrates just how vulnerable fossil fuel-dependent nations can be.
But Europe has ambitious plans to become the world’s first climate neutral continent by 2050 that are now enshrined in its Climate Law.
So in the face of immense political, economical and environmental pressure to transition to a renewable and carbon-free supply of energy, what are viable alternative solutions that can be implemented today?
Energy experts say the answer lies in looking at both short and long-term solutions that will bring relief.
At Emergent Energy, Platt is developing networks to help residential property companies supply solar electricity directly to local households.
“Renewables get cheaper every year,” says Platt, “we need to liberalise the market rules so that families are less exposed to global prices and can directly enjoy cost savings from renewables generated in their area.
“Residential property companies need to reduce emissions from their housing developments to comply with regulation and protect residents from spiralling energy costs.”
Rajvant Nijjhar, CEO at Bank Energi helps businesses manage energy more efficiently with tools to pre-schedule energy use to turn off during peak grid events as well as combine battery storage, Air Source Heat pumps and Solar PV to reduce costs and emissions.
Utility Bridge Founder, Darron Jones, has developed a simple SaaS solution that helps businesses better understand their energy data, reduce usage, and transition to renewables to save on costs.
“We need to plan and transition to a long-term energy strategy. More cheap renewables along with the potential of nuclear fusion on the horizon is all great,” says Jones.
“But, as we move towards that goal, cheap gas is needed- even if we just use our own shale resources in the UK for electricity generation whilst moving towards better management of local grids and small-scale local generation, such as battery storage and DSR (demand side response) to manage our energy needs as well as supply.”
Vertus Energy Co-founder Reyes adds that “solar and wind have proven themselves to be a renewable but not consistently reliable source of energy. Hydropower and geothermal have their own mitigating factors and H2 production and the transportation of it is currently costly for it to be viable at scale.
“Renewable Natural Gas, Compressed RNG and Liquid RNG have huge potential in replacing a lot of the fossil energy that we use, but again, currently they need to be operated at scale to be economically viable.
“All of these options combined and working in tandem within the deep and complex system that is our energy requirements is essential to achieve true change.”
Vertus Energy hopes to be among the catalysts for true change; its making biogas and biomethane production 60% more efficient, using anaerobic digestion through microbes.
“That makes the entire value chain of waste to energy not just affordable but actually achievable. The end product, biogas, that you get from waste to energy plants can be upgraded into biomethane, which is a direct replacement for fossil natural gas,” says Reyes.
“That biomethane can also be refined into CRNG and LRNG which are amazing and powerful fuels for heavy industrial process and transport industries. The impact is far reaching and dramatic on our net-zero goals,” he says.
So will the current European energy crisis spark a faster transition to renewables? Consumers have undoubtedly grown more conscientious in their choice of food, cars and the companies they chose to buy from. Now, with energy bills in the hot seat the collective awareness and sense of urgency around energy could help drive uptake of renewable energy.
After seeing his electric bill more than double, Hollow is exploring all options to reduce his energy use – from quicker showers to buying a more energy efficient radiator to getting thicker curtains for better insulation.
Some households will be able to take advantage of innovative solutions for producing their own green energy, like solar panels that can be set up on the balcony and simply plugged in.
“But there's only so much you can do as a renter, which is very frustrating,” says Hollow, who is left to reckon with UK inflation levels due to reach 8% in April amidst a cost of living crisis.
“Watching house prices continue to skyrocket, wages continue to stagnate, and now the cost of shopping and energy have exploded too, there is a constant sense that the goalposts of ‘saving up for the future’ just keep being moved.
“I'm fortunate to find myself in a situation where I have enough income to be saving up a few hundred pounds a month, but I can't shake the sense that it's not enough and will never be enough, and that's a very disheartening thought.”
A Europe that relies on nature to generate its own stable supply of clean, non-polluting energy may yet be a distant goal, but the current crisis has shone a spotlight on just how much its one worth pursuing.