The Energy Crisis: Causes, Responses, and Solar as Part of the Longer-Term Solution

Millions of families in the UK risk being forced into fuel poverty after the energy price cap was increased in April. With further increases expected in October, it does not appear there will be a reprieve any time soon. But what is specifically behind the energy crisis in the UK? What have other countries done to avoid similarly disastrous situations? What can the country do to mitigate the impact and help millions of citizens and businesses? And importantly, how can we reduce our reliance on fossil fuels in favour of clean energy sources, such as solar power?

What’s Causing the Crisis?

“We’re seeing a perfect storm as myriad unfavourable circumstances all play out at the same time”

The timing of the energy crisis could not be worse, with the wider cost of living crisis happening simultaneously across the UK, further exacerbating the situation for millions. There is no single reason for the ongoing and increasing crisis; globally we are seeing a perfect storm as myriad unfavourable circumstances all play out at the same time.

So, how did we get here? Some of the key factors (though the list could be much longer!), are: -

• War in Ukraine
• Asia’s Demand for Gas
• Nordstream 2
• Insufficient Gas Storage Capabilities
• Fossil Fuel Resurgence

How Are Others Dealing with the Crisis?

“Many countries still reliant on fossil fuels are feeling the pressure”

The energy crisis is not limited to the UK. As we have already seen, a combination of global circumstances have coincided, meaning many countries still reliant on fossil fuels are feeling the pressure. But is the crisis being felt to the same level in other countries? How are our European neighbours and global allies coping, and what mitigating measures and solutions are they putting in place?

• France – the French government have capped energy prices, give grants to those most in need, and forced EDF to lower prices
• Spain – the Spanish government have cut taxes to prevent rapid bill increases, and implemented a ‘windfall’ tax on energy companies
• China – 100’s of coal mines have ramped up production, and enforced blackouts have been introduced in some areas
• United States – decisive action is short on the ground with Biden potentially reluctant to pass drastic measures with mid-term elections looming.

Is There a Solution?

“The best route to energy independence is to completely remove our reliance on fossil fuels”

There are huge lessons to be learnt from the ongoing energy crisis, and global leaders are rapidly discovering how major conflicts can impact energy supply and markets. There really isn’t one single answer to the question ‘is there a solution’, rather a potential raft of measures to help accelerate decarbonisation and more rapidly reduce our reliance on fossil fuels.

Shorter term mitigations may include:-

• Remove/Reduce VAT – removing Value Added Tax on energy bills is estimated to save around ￡300 a year for a typical household
• Windfall Tax –a recent poll showed overwhelming public support for a windfall tax on energy companies

Longer- term solutions are clearer: -

• Energy Independence – this would put the UK in control of its own supplies, and remove effects of global market volatility
• Clean Energy –The UK has the renewable resources to power itself completely, but needs the political will to make this happen

How can Solar energy help ease the crisis?

“Geospatial Insight have helped Authorities across the UK implement clean energy strategies faster”

The UK has already set an ambitious solar target of 50 gigawatts (GW) by 2030, more than tripling the current capacity of approximately 15GW. 2021, in particular, was seen as a pivotal growth year for solar in the UK with an increase in new solar deployment 36% higher than 2020 levels.

The benefits of this existing 15GW of solar are already being felt; over 1 million households are generating their own electricity in the UK, not only given them energy independence, but also delivering huge reductions on their energy bills and the chance to generate revenue by selling excess electricity back to the grid.

Communities across the country are also coming together to develop large solar projects, working with local landowners or large roof owners to install arrays that will deliver affordable, clean energy to local residents. Additionally, as the community owns and operates the array, any revenue generated from it is also re-invested back into the local projects.

The appetite for and appreciation of solar are well known – it is consistently voted the UK population’s preferred renewable energy generation method – but with dual concerns around not only the energy crisis but the climate crisis too, the question turns to how we can scale deployment to the levels required for true energy independence, and ensure solar is more rapidly implemented in the most beneficial locations financially and environmentally.

Location-based services are reducing the timescales traditionally associated with identifying and aggregating solar projects, leveraging contemporary data and analytical techniques to facilitate the rapid, widescale transition to renewable energy generation we need if we are to meet the UK’s target of tripling solar capacity to 50 gigawatts by 2030.

Geospatial Insight have already provided solar suitability assessments to multiple energy stakeholders including Oxfordshire County Council, Lambeth Council, Scottish Power, and Sovereign Housing amongst others. This analysis has enabled these organisations to gain a more complete understanding of where solar could be installed, and the benefits it can deliver, feeding directly into their strategic plans for clean energy and decarbonisation.

We are eager to help as many companies as we can in the transition to clean energy, so if you’d like to know more, please feel free to drop me a direct message on LinkedIn, or email [email protected]