Although the government on the surface is remaining calm about the situation, many people up and down the country are beginning to fear the worst ahead of the upcoming winter. Natural gas, petrol and diesel across Europe are in tight supply and prices have soared as a result.
Experts say a cold 2020-2021 winter dried up our reserves, which is no real concern. These reserves are normally replenished throughput summer months when demand is significantly lower than throughout the winter, yet this year, the rate of refill has been slower than expected.
Another cause of the shortage can be attributed to UK and Europe’s adoption of the policy to slowly phase out coal power plants with an increasingly focused drive on renewable sources of energy such as solar and wind. A period of still, cloudy weather has had a remarkably big effect on our energy grid.
This, combined with easing lockdown restrictions and subsequent greater freedoms for the public has sent the UK energy market into a panic. Prime Minister Boris Johnson described the situation as “It’s like everybody going back to put the kettle on at the end of a TV programme”. With the world recovering from COVID-19 and nation’s economies springing back into life, there has been huge pressure on energy systems and the UK has been hit particularly hard.
Gas prices are up a staggering 250% since the start of the year and this has had a ruinous effect on small energy suppliers. Energy suppliers Bulb and Ovo, with a combined total of 6.7 million customers, are now intentionally discouraging any new business. These small energy suppliers simply cannot compete with the rising prices and now have to break customer promises to stay afloat.
There are also growing fears that the crisis will lead to food shortages. The UK has already been hit with HGV driver shortages and if carbon dioxide supplies continue to be hampered, the food industry faces an uncertain winter ahead. The gas is used to carbonate beer and fizzy drinks and is also vital in its transport. Food delivery services such as Ocado use the gas in their vans to make dry ice which is critical for its frozen produce. Moreover, carbon dioxide is used in the process for animal slaughter. If the supplies continue to be drained at the current rate, meat shelves in supermarkets could become empty in as little as a fortnight. The busiest time of the year for the food industry is throughout the Christmas period. There are already concerns that Turkey supplies will be affected.
Already there are claims that Russia is to blame. Europe receive huge quantities of gas from the resource rich state. For countries like Estonia and Poland, over 75% of their energy imports come from Russia. When Russia can turn the taps on and off at will, one might question their influence over such countries. There are worries that Russia is sending less gas to Europe in a bid to pressurize the EU into accepting the new gas pipeline Nord Stream 2. The highly controversial offshore pipeline would send natural gas from Russia to Germany under the Baltic Sea. Many fear that Russia already garners too much influence over the rest of Europe in regard to energy supplies. Nord Stream 2 would not only cement these fears but undoubtedly make them grow.
In the UK, there are 22 million homes connected to gas grid, all of which are now directly affected by the crisis. Some early indications suggest that the energy bills of these homes may increase by as much as £400. In this post-COVID financial climate many families will feel the real effect of this price hike and there really isn’t much anyone can do about it. Prices will rise and people will always need electricity and petrol. They are basic components of a human’s life nowadays.
Business Secretary Kwasi Kwarteng has echoed the words of Boris Johnson and insisted that the government are on top of the situation and there is no real need to worry but warns the UK must get ready for prices that will remain higher than normal. COP26 President Alok Sharma has also wayed in and reaffirms that people should not be overly concerned.
High prices will remain high until at least the end of the year; however, the shortages will end, and the crisis does have a solution. A mild European winter would help the situation tenfold. A windy winter would be even better and the combination of both should be enough to restore calm to the energy market. In the short term the situation may seem dire and public panic will never be far off the horizon, however, this is what the UK needs. In a week where climate change protestors have hit the headlines again, perhaps the nation should be proud that the UK is leading in its efforts to move away from fossil fuels in favour of renewable sources, despite the occasional shortage that we seem to be facing now.