Energy crisis

I am worried about the coming winter due to the impending change to the energy price cap in October. The media are reporting astronomically high energy bill projections. Bloomberg reports that bills could hit up to £5,000 a year. This shit is crazy and out of control. Though the coverage makes it seem like all this is caused by external factors beyond the control of us mere mortals. This is simply untrue.

Too often, the villain cast is big bad Russia. Putin. As they have a death grip on the natural gas supply. Being the number one exporter and number two producer in the world and holding 20% of the global reserves – Russia is indeed a major player in energy.

In February 2022, Russia invaded Ukraine. This has led Europe and the UK to step back from dealing with Russia and Putin. Which has put a strain on the energy market as Russia exports a massive portion of natural gas and oil. More importantly, Europe and the UK were heavily importing these resources from Russia.

If you cut off 20% of your supply, the value, ergo price, of the remaining 80% will naturally increase. It is basic supply and demand dynamics. Supply decreased and demand increased.

What frustrates me is the painfully slow move towards green and renewable energy sources. Of course, the pace of change has been dictated by the lobbying efforts of fossil fuel conglomerates and greedy politicians. Fuck you guys.

For Christ’s sake, the solar panel was invented in 1954. 1954! 68 fucking years ago! How is this technology not more mature? It seems to only have come into its own over the last decade or so. Ludicrous.

Sol, our sun, is bathing the Earth continuously with 173,000 terawatts of energy – that’s more than 7 times our total energy used globally in an entire year (2019). I’ll repeat that to really drive the point home. That’s enough energy for 7 Earths, to be powered for a year, every second!

The sun is the greatest natural resource we have and science long ago unlocked a way for us to harness it, but due to greed, we’ve largely ignored the opportunity and stifled progress.

Alas, it’s 2022, and we do use solar and other renewables for our energy needs in the UK, which is great, but by far the biggest energy source is natural gas. Imported natural gas, which is transported via ships that also run on fossil fuels. Great job.

The obvious problem with renewables is that the wind isn’t always blowing, and the sun isn’t always shining, though with the weather recently you’d be forgiven for forgetting that. The solution isn’t then to fill the gap with fossil fuels, which is precisely what we currently do. Why do we always jump to burning shit, like we’re cave people that just discovered fire? The solution, somewhat obvious, is energy storage. Investing aggressively in energy storage. The UK has some of the lowest storage capacity of any European nation, with only enough to power the country through 4-5 winter days. Whereas others have capacity for several weeks. This is unacceptable. If we, Britain, want to be a global leader in anything after fucking-off the EU, we need a strong energy foundation. We should be investing in local energy infrastructure. Energy storage with technologies like Megapack and clean supporting energy like nuclear (safer than you think).

Germany have been, with poor judgement, shutting down their nuclear power plants, which is exacerbating their energy issues.

The craziest part of all this, at least to me, is how the price of energy is set. If you’re anything like me, you’ve probably been wondering why the strain on natural gas supplies is making electricity more expensive?

Well, part of it is that gas is used to produce about 38% of the UK’s electricity. Again with the burning. The main reason why gas dictates the price is something called the “merit order”. I know this was news to me when I heard about it, too. Basically, it’s a ranking system for sources of electricity generation. Renewables are first in the order as they are prioritised due to being cheapest to run, and gas or oil are usually last. The last item in the order is what sets the price. Read more here, it’s got an illustrative chart too.

I’m with Octopus Energy, which use 100% renewable electricity, but my bills are still poised to balloon simply because of the way the system works. This is not a free and competitive market. Renewables should not have their price set by fossil fuels.

The way electricity is priced needs reform – the government should move to decouple renewables from legacy energy sources. If this were already the case, my energy bills, for electricity at least, would stay the same this winter.

Our energy needs as a global civilisation will only continue to grow exponentially as we advance, we need to make strides towards long-term change for our children.

There’s more detail to all this, so if you’re interested do your own research, but the bottom line is that the War in the east isn’t the problem, it’s our poor fragile infrastructure.

Well, there you have it. An incredibly muddy picture of the state of energy in the UK today and why I’m tired, worried and pretty frustrated with it all.

You know what? I might just not pay.