Britons could save on soaring bills as ministers plan to end link between gas and electricity prices


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UK Electricity-Gas Price Decoupling aims to reform wholesale electricity pricing under the Energy Security Bill, shielding households from gas price spikes, supporting renewables, and easing the cost-of-living crisis through market redesign and transparent tariffs.

 

Key Points

Policy to decouple power prices from gas via the Energy Security Bill, stabilizing bills and reflecting renewables

✅ Breaks gas-to-power pricing link to cut electricity costs

✅ Reduces volatility; shields households from global gas shocks

✅ Highlights benefits of renewables and market transparency

 

Britons could be handed relief on rocketing household bills under Government plans to sever the link between the prices of gas and electricity, including proposals to restrict energy prices in the market, it has emerged.

Ministers are set to bring forward new laws under the Energy Security Bill to overhaul the UK's energy market in the face of the current cost-of-living crisis.

They have promised to provide greater protection for Britons against global fluctuations in energy prices, through a price cap on bills among other measures.

The current worldwide crisis has been exacerbated by the Ukraine war, which has sent gas prices spiralling higher.

Under the current make-up of Britain's energy market, soaring natural gas prices have had a knock-on effect on electricity costs.

But it has now been reported the new legislation will seek to prevent future shocks in the global gas market having a similar impact on electricity prices.

Yet the overhaul might not come in time to ease high winter energy costs for households ahead of this winter.

According to The Times, Business Secretary Kwasi Kwarteng will outline proposals for reforms in the coming weeks.

These will then form part of the Energy Security Bill to be introduced in the autumn, with officials anticipating a decrease in energy bills by April.

The newspaper said the plans will end the current system under which the wholesale cost of gas effectively determines the price of electricity for households.

Although more than a quarter of Britain's electricity comes from renewable sources, under current market rules it is the most expensive megawatt needed to meet demand that determines the price for all electricity generation.

This means that soaring gas prices have driven up all electricity costs in recent months, even though only around 40% of UK electricity comes from gas power stations.

Energy experts have compared the current market to train passengers having to pay the peak-period price for every journey they make.

One Government source told The Times: 'In the past it didn’t really matter because the price of gas was reasonably stable.

'Now it seems completely crazy that the price of electricity is based on the price of gas when a large amount of our generation is from renewables.'

It was also claimed ministers hope the reforms will make the market more transparent and emphasise to consumers the benefits of decarbonisation, amid an ongoing industry debate over free electricity for consumers.

A Government spokesperson said: 'The high global gas prices and linked high electricity prices that we are currently facing have given added urgency to the need to consider electricity market reform.

 

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Will Iraq have enough electricity for coming hot summer days?

Iraq Electricity Crisis intensifies as summer heat drives demand; households face power outages, reliance on private generators, distorted tariffs, and strained grid capacity despite government reforms, Siemens upgrades, and IEA warnings.

 

Key Points

A supply-demand gap causing outages, generator reliance, and grid inefficiencies across Iraq, worsened by summer peaks.

✅ Siemens deal to upgrade generation and grid

✅ Progressive tariffs to curb demand and waste

✅ Private generators fill gaps but raise costs

 

At a demonstration in June 2018, protesters in Basra loaded a black box resembling a coffin with the inscription “Electricity” onto the roof of a car. This was one demonstration of how much of a political issue electricity is in Iraq.

With what is likely to be another hot summer ahead, there is increasing pressure on the Baghdad government to improve access to electricity and water.

Many Iraqis blame the government for not providing adequate services despite the country’s oil wealth. Protests in southern Iraq last year turned violent, with demonstrators attacking governmental and political parties’ buildings; in neighboring Iran, blackouts also sparked protests over outages.

“It is very hard” to deal with the electricity issues, said Iraqi journalist Methaq al-Fayyadh, adding that the lack of reliable electricity was not a new problem and affects most parts of the country.

Dozens of people protested June 1 in Karbala against prices for new generators and demanded an improvement to the electricity situation.

In anticipation of high temperatures during Eid al-Fitr, the Electricity Ministry called on governorates to adhere to allocated quotas and told the public to ration electricity.

“Outages remain a daily occurrence for most households because increasing generating capacity has been outrun by increasing demand for electricity, as surging demand worldwide demonstrates,” noted the International Energy Agency (IAE) in April.

This is particularly the case, the authors said, as the hot summer months, when temperatures can top 50 degrees Celsius, drive up the use of air conditioning.

The Iraqi government has made improving the electricity supply one of its priorities, including nuclear power plans under consideration. The Electricity Ministry, headed by Luay al-Khatteeb, announced in May that national electricity production had reached 17 gigawatts.

Khatteeb presented comparative electricity data for May from 2018 and 2019, indicating production increases on every day of the month. IEA data indicate that available electricity supply has increased over the past five years and the gap between supply and demand has widened.

The government signed an agreement with German company Siemens this year to upgrade Iraq’s electricity grid, and in parallel deals with Iran to rehabilitate and develop the grid were finalized, according to Iranian officials. The agreement “includes the addition of new and highly efficient power generation capacity, rehabilitation and upgrade of existing plants and the expansion of transmission and distribution networks,” Siemens said.

The Iraqi prime minister’s office said the 4-year plan would be worth $15.7 billion. The first phase includes the installation of 13 transformer stations, cooling systems for power stations and building a 500-megawatt, gas-fired power plant south of Baghdad.

In an interview with Al-Monitor, Khatteeb said radical changes would happen in 2020, stating that the current situation was not “ideal” but “better” because of steps taken to create more energy, amid discussions on energy cooperation with Iran that could shape implementation.

Robert Tollast, of the Iraq Energy Institute, said the economics of the electricity system is distorted. Subsidies ensured that electricity provided by the national grid is almost free, he said. However, while the subsidies were designed to help the poor, the tariff system disadvantages them and does not create incentives to consume electricity more efficiently, he said.

A large part of families’ electricity expenditures goes to operators of privately owned generators, which run on fuel. These neighbourhood generators are used to close gaps in the electricity supply but are expensive, and regional fuel arrangements such as ENOC’s swap of Iraqi fuel have highlighted supply constraints. Generator operators have sometimes worked with armed groups to prevent upgrades to the grid that could hurt their business.

Until 1990, the Iraq electricity sector was considered among the best in the region. That legacy was destroyed by successive wars and international sanctions. With Iraq’s population growing at a rate of 1 million per year, peak demand is projected to double by 2030 if left unchecked, the IEA estimated.

Tollast said efforts to improve the distribution system and increase capacity are key but it is important “to tackle the problem from the demand side.” This entails implementing a progressive tariff scheme so users pay more if they consume more, he said. There is a “tremendous use of energy per capita in Iraq,” Tollast said.

In the current tariff structure, consumers pay a fixed price if they use more than 4,000-kilowatt hours per year, a relatively low amount, meaning the price per unit drops the more one consumes.

Any change to the tariff system must be accompanied by a “political campaign” to explain the changes, said Tollast, adding that more investment in the electricity sector and a “change in culture” of using electricity was needed. “The current system is unsustainable, even with high oil prices,” he said.

Fayyadh said people don’t expect the government will be able to fix the electricity issue before summer, having failed to do so in the past.

Tollast struck a more optimistic tone, saying it was unlikely that Iran, which supplies about 40% of Iraq’s power, would cut its export of electricity to Iraq this year as it did in 2018. He added that the water situation was better than last year when the country experienced drought. Iraq has also been processing more flare gas, which can be used to generate electricity.

“There is an expectation that this year might not be as bad as last year,” he concluded.

 

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Wind and Solar Energy Surpass Coal in U.S. Electricity Generation

Wind and Solar Surpass Coal in U.S. power generation, as EIA data cites falling LCOE, clean energy incentives, grid upgrades, and battery storage driving renewables growth, lower emissions, jobs, and less fossil fuel reliance.

 

Key Points

An EIA-noted milestone where U.S. renewables outproduce coal, driven by lower LCOE, policy credits, and grid upgrades.

✅ EIA data shows wind and solar exceed coal generation

✅ Falling LCOE boosts project viability across the grid

✅ Policies and storage advances strengthen reliability

 

In a landmark shift for the energy sector, wind and solar power have recently surpassed coal in electricity generation in the United States. This milestone, reported by Warp News, marks a significant turning point in the country’s energy landscape and underscores the growing dominance of renewable energy sources.

A Landmark Achievement

The achievement of wind and solar energy generating more electricity than coal is a landmark moment in the U.S. energy sector. Historically, coal has been a cornerstone of electricity production, providing a substantial portion of the nation's power needs. However, recent data reveals a transformative shift, with renewables surpassing coal for the first time in 130 years, as renewable energy sources, particularly wind and solar, have begun to outpace coal in terms of electricity generation.

The U.S. Energy Information Administration (EIA) reported that in recent months, wind and solar combined produced more electricity than coal, including a record 28% share in April, reflecting a broader trend towards cleaner energy sources. This development is driven by several factors, including advancements in renewable technology, decreasing costs, and a growing commitment to reducing greenhouse gas emissions.

Technological Advancements and Cost Reductions

One of the key drivers behind this shift is the rapid advancement in wind and solar technologies, as wind power surges in the U.S. electricity mix across regions. Improvements in turbine and panel efficiency have significantly increased the amount of electricity that can be generated from these sources. Additionally, technological innovations have led to lower production costs, making wind and solar energy more competitive with traditional fossil fuels.

The cost of solar panels and wind turbines has decreased dramatically over the past decade, making renewable energy projects more economically viable. According to Warp News, the levelized cost of electricity (LCOE) from solar and wind has fallen to levels that are now comparable to or lower than coal-fired power. This trend has been pivotal in accelerating the transition to renewable energy sources.

Policy Support and Investment

Government policies and incentives have also played a crucial role in supporting the growth of wind and solar energy, with wind now the most-used renewable electricity source in the U.S. helping drive deployment. Federal and state-level initiatives, such as tax credits, subsidies, and renewable energy mandates, have encouraged investment in clean energy technologies. These policies have provided the financial and regulatory support necessary for the expansion of renewable energy infrastructure.

The Biden administration’s focus on addressing climate change and promoting clean energy has further bolstered the transition. The Infrastructure Investment and Jobs Act and the Inflation Reduction Act, among other legislative efforts, have allocated significant funding for renewable energy projects, grid modernization, and research into advanced technologies.

Environmental and Economic Implications

The surpassing of coal by wind and solar energy has significant environmental and economic implications, building on the milestone when renewables became the second-most prevalent U.S. electricity source in 2020 and set the stage for further gains. Environmentally, it represents a major step forward in reducing carbon emissions and mitigating climate change. Coal-fired power plants are among the largest sources of greenhouse gases, and transitioning to cleaner energy sources is essential for meeting climate targets and improving air quality.

Economically, the shift towards wind and solar energy is creating new opportunities and industries. The growth of the renewable energy sector is generating jobs in manufacturing, installation, and maintenance. Additionally, the decreased reliance on imported fossil fuels enhances energy security and stabilizes energy prices.

Challenges and Future Outlook

Despite the progress, there are still challenges to address. The intermittency of wind and solar power requires advancements in energy storage and grid management to ensure a reliable electricity supply. Investments in battery storage technologies and smart grid infrastructure are crucial for overcoming these challenges and integrating higher shares of renewable energy into the grid.

Looking ahead, the trend towards renewable energy is expected to continue, with renewables projected to soon provide about one-fourth of U.S. electricity as deployment accelerates, driven by ongoing technological advancements, supportive policies, and a growing commitment to sustainability. As wind and solar power become increasingly cost-competitive and efficient, their role in the U.S. energy mix will likely expand, further displacing coal and other fossil fuels.

Conclusion

The surpassing of coal by wind and solar energy in U.S. electricity generation is a significant milestone in the transition to a cleaner, more sustainable energy future. This achievement highlights the growing importance of renewable energy sources and the success of technological advancements and supportive policies in driving this transition. As the U.S. continues to invest in and develop renewable energy infrastructure, the move away from coal represents a crucial step towards achieving environmental goals and fostering economic growth in the clean energy sector.

 

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Ukraine Leans on Imports to Keep the Lights On

Ukraine Electricity Imports surge to record levels as EU neighbors bolster grid stability amid Russian strikes, supporting energy security, preventing blackouts, and straining cross-border transmission capacity while Ukraine rebuilds damaged infrastructure and diversifies with renewables.

 

Key Points

Emergency EU power purchases stabilizing Ukraine’s grid after war damage.

✅ Record 19,000 MWh per day from EU interconnectors

✅ Supports grid stability and blackout prevention

✅ Cost and transmission upgrades challenge sustainability

 

Russia's ongoing war in Ukraine has extended far beyond the battlefield, with critical infrastructure becoming a target. Ukraine's once-robust energy system has sustained significant damage amid energy ceasefire violations and Russian missile and drone strikes. To cope with these disruptions and maintain power supplies for Ukrainian citizens, the country is turning to record-breaking electricity imports from neighboring European nations.

Prior to the war, Ukraine enjoyed a self-sufficient energy sector, even exporting electricity to neighboring countries. However, targeted attacks on power plants and transmission lines have crippled generation capacity. The situation is particularly dire in eastern and southern Ukraine, where ongoing fighting has caused extensive damage.

Faced with this energy crisis, Ukraine is looking to Europe for a lifeline. The country's energy ministry has announced plans to import a staggering amount of electricity – exceeding 19,000 megawatt-hours (MWh) per day – to prepare for winter and stabilize supplies. This surpasses the previous record set in March 2024 and represents a significant increase in Ukraine's reliance on external power sources.

Several European nations are stepping up to support Ukraine. Countries like Poland, Slovakia, Romania, Hungary, which maintains quiet energy ties with Russia today, and Moldova have agreed to provide emergency electricity supplies. These imports will help stabilize Ukraine's power grid and prevent widespread blackouts, especially during peak consumption hours.

The reliance on imports, however, presents its own set of challenges. Firstly, the sheer volume of electricity needed puts a strain on the capacity of neighboring grids. Upgrading and expanding transmission infrastructure will be crucial to ensure a smooth flow of electricity. Secondly, the cost of imported electricity can be higher than domestically generated power amid price hikes and instability globally, placing additional pressure on Ukraine's already strained finances.

Beyond these immediate concerns, the long-term implications of relying on external energy sources need to be considered. Ukraine's long-term goal is to rebuild its own energy infrastructure and regain energy independence. International assistance, including energy security support measures, will be crucial in this endeavor. Financial aid and technical expertise can help Ukraine repair damaged power plants, diversify its energy mix through further investment in renewables, and develop more resilient grid infrastructure.

The war in Ukraine has underscored the importance of energy security. A nation's dependence on a single source of energy, be it domestic or foreign, leaves it vulnerable to disruption, as others consider national security and fossil fuels in their own policies. For Ukraine, diversification and building a more resilient energy infrastructure are key takeaways from this crisis.

The international community also has a role to play. Supporting Ukraine's energy sector not only helps the nation weather the current crisis but also strengthens European energy security as a whole, where concerns over Europe's energy nightmare remain pronounced. A stable and independent Ukraine, less reliant on Russian energy, contributes to a more secure and prosperous Europe.

As the war in Ukraine continues, the battle for energy security rages on. While the immediate focus is on keeping the lights on through imports, the long-term goal for Ukraine is to rebuild a stronger, more resilient energy sector that can power the nation's future. The international community's support will be crucial in helping Ukraine achieve this goal.

 

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Electricity turns garbage into graphene

Waste-to-Graphene uses flash joule heating to convert carbon-rich trash into turbostratic graphene for composites, asphalt, concrete, and flexible electronics, delivering scalable, low-cost, high-quality material from food scraps, plastics, and tires with minimal processing.

 

Key Points

A flash heating method converting waste carbon into turbostratic graphene for scalable, low-cost industrial uses.

✅ Converts food scraps, plastics, and tires into graphene

✅ Produces turbostratic flakes that disperse well in composites

✅ Scalable, low-cost process via flash joule heating

 

Science doesn’t usually take after fairy tales. But Rumpelstiltskin, the magical imp who spun straw into gold, would be impressed with the latest chemical wizardry. Researchers at Rice University report today in Nature that they can zap virtually any source of solid carbon, from food scraps to old car tires, and turn it into graphene—sheets of carbon atoms prized for applications ranging from high-strength plastic to flexible electronics, and debates over 5G electricity use continue to evolve. Current techniques yield tiny quantities of picture-perfect graphene or up to tons of less prized graphene chunks; the new method already produces grams per day of near-pristine graphene in the lab, and researchers are now scaling it up to kilograms per day.

“This work is pioneering from a scientific and practical standpoint” as it promises to make graphene cheap enough to use to strengthen asphalt or paint, says Ray Baughman, a chemist at the University of Texas, Dallas. “I wish I had thought of it.” The researchers have already founded a new startup company, Universal Matter, to commercialize their waste-to-graphene process, while others are digitizing the electrical system to modernize infrastructure.

With atom-thin sheets of carbon atoms arranged like chicken wire, graphene is stronger than steel, conducts electricity and heat better than copper, and can serve as an impermeable barrier preventing metals from rusting, while advances such as superconducting cables aim to cut grid losses. But since its 2004 discovery, high-quality graphene—either single sheets or just a few stacked layers—has remained expensive to make and purify on an industrial scale. That’s not a problem for making diminutive devices such as high-speed transistors and efficient light-emitting diodes. But current techniques, which make graphene by depositing it from a vapor, are too costly for many high-volume applications. And higher throughput approaches, such as peeling graphene from chunks of the mineral graphite, produce flecks composed of up to 50 graphene layers that are not ideal for most applications.

Graphene comes in many forms. Single sheets, which are ideal for electronics and optics, can be grown using a method called chemical vapor deposition. But it produces only tiny amounts. For large volumes, companies commonly use a technique called liquid exfoliation. They start with chunks of graphite, which is just myriad stacked graphene layers. Then they use acids and solvents, as well as mechanical grinding, to shear off flakes. This approach typically produces tiny platelets each made up of 20 to 50 layers of graphene.

In 2014, James Tour, a chemist at Rice, and his colleagues found they could make a pure form of graphene—each piece just a few layers thick—by zapping a form of amorphous carbon called carbon black with a laser. Brief pulses heated the carbon to more than 3000 kelvins, snapping the bonds between carbon atoms; for comparison, researchers have also generated electricity from falling snow using triboelectric effects. As the cloud of carbon cooled, it coalesced into the most stable structure possible, graphene. But the approach still produced only tiny qualities and required a lot of energy.

Two years ago, Luong Xuan Duy, one of Tour’s graduate students, read that other researchers had created metal nanoparticles by zapping a material with electricity, creating the same brief blast of heat behind the success of the laser graphene approach. “I wondered if I could use that to heat a carbon source and produce graphene,” Duy says. So, he put a dash of carbon black in a clear glass vial and zapped it with 400 volts, similar in spirit to electrical weed zapping approaches in agriculture, for about 200 milliseconds. Initially he got junk. But after a bit of tweaking, he managed to create a bright yellowish white flash, indicating the temperature inside the vial was reaching about 3000 kelvins. Chemical tests revealed he had produced graphene.

It turned out to be a type of graphene that is ideal for bulk uses. As the carbon atoms condense to form graphene, they don’t have time to stack in a regular pattern, as they do in graphite. The result is a material known as turbostatic graphene, with graphene layers jumbled at all angles atop one another. “That’s a good thing,” Duy says. When added to water or other solvents, turbostatic graphene remains suspended instead of clumping up, allowing each fleck of the material to interact with whatever composite it’s added to.

“This will make it a very good material for applications,” says Monica Craciun, a materials physicist at the University of Exeter. In 2018, she and her colleagues reported that adding graphene to concrete more than doubled its compressive strength. Tour’s team saw much the same result. When they added just 0.05% by weight of their flash-produced graphene to concrete, the compressive strength rose 25%; graphene added to polydimethylsiloxane, a common plastic, boosted its strength by 250%.

As digital control spreads across energy networks, research to counter ransomware-driven blackouts is increasingly important for grid resilience.

Those results could reignite efforts to use graphene in a wide range of composites. Researchers in Italy reported recently that adding graphene to asphalt dramatically reduces its tendency to fracture and more than doubles its life span. Last year, Iterchimica, an Italian company, began to test a 250-meter stretch of road in Milan paved with graphene-spiked asphalt. Tests elsewhere have shown that adding graphene to paint dramatically improves corrosion resistance.

These applications would require high-quality graphene by the ton. Fortunately, the starting point for flash graphene could hardly be cheaper or more abundant: Virtually any organic matter, including coffee grounds, food scraps, old tires, and plastic bottles, can be vaporized to make the material. “We’re turning garbage into graphene,” Duy says.

 

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Vietnam Redefines Offshore Wind Power Regulations

Vietnam Offshore Wind Regulations expand coastal zones to six nautical miles, remove water depth limits, streamline permits, and boost investment, grid integration, and renewable energy capacity across deeper offshore wind resource areas.

 

Key Points

Policies extend sites to six nautical miles, scrap depth limits, and speed permits to scale offshore wind.

✅ Extends offshore zones to six nautical miles from shore

✅ Removes water depth limits to access stronger winds

✅ Streamlines permits, aiding grid integration and finance

 

Vietnam has recently redefined its regulations for offshore wind power projects, marking a significant development in the country's renewable energy ambitions. This strategic shift aims to streamline regulatory processes, enhance project feasibility, and accelerate the deployment of offshore wind energy in Vietnam's coastal regions, amid a trillion-dollar offshore wind market globally.

Regulatory Changes

The Vietnamese government has adjusted offshore wind power regulations by extending the allowable distance from shore for wind farms to six nautical miles (approximately 11 kilometers), a move that aligns with evolving global practices such as Canada's offshore wind plan announced recently by regulators. This expansion from previous limits aims to unlock new areas for development and maximize the utilization of Vietnam's vast offshore wind potential.

Scrapping Depth Restrictions

In addition to extending offshore boundaries, Vietnam has removed restrictions on water depth for offshore wind projects. This revision allows developers to explore deeper waters, where wind resources may be more abundant, thereby diversifying project opportunities and optimizing energy generation capacity.

Strategic Implications

The redefined regulations are expected to stimulate investment in Vietnam's renewable energy sector, attracting domestic and international stakeholders keen on capitalizing on the country's favorable wind resources, with World Bank support for wind underscoring the growing pipeline in developing markets. The move aligns with Vietnam's broader energy diversification goals and commitment to reducing reliance on fossil fuels.

Economic Opportunities

The expansion of offshore wind development zones creates economic opportunities across the value chain, from project planning and construction to operation and maintenance. The influx of investments is anticipated to spur job creation, technology transfer, and infrastructure development in coastal communities, as industry groups like Marine Renewables Canada shift toward offshore wind specialization.

Environmental and Energy Security Benefits

Harnessing offshore wind power contributes to Vietnam's efforts to mitigate greenhouse gas emissions and combat climate change. By integrating renewable energy sources into its energy mix, Vietnam enhances energy security, as seen in the UK offshore wind expansion, reduces dependency on imported fuels, and promotes sustainable economic growth.

Challenges and Considerations

Despite the promising outlook, offshore wind projects face challenges such as technical complexities, environmental impact assessments, and grid integration, as well as exposure to policy risk exemplified by U.S. opposition to offshore wind debates.

Future Outlook

Looking ahead, Vietnam's redefined offshore wind regulations position the country as a key player in the global renewable energy transition, a trend reinforced by progress in offshore wind in Europe elsewhere. Continued policy support, investment facilitation, and technological innovation will be critical in unlocking the full potential of offshore wind power and achieving Vietnam's renewable energy targets.

Conclusion

Vietnam's revision of offshore wind power regulations reflects a proactive approach to advancing renewable energy development and fostering a conducive investment environment. By expanding development zones and eliminating depth restrictions, Vietnam sets the stage for accelerated growth in offshore wind capacity, contributing to both economic prosperity and environmental stewardship. As stakeholders seize opportunities in this evolving landscape, collaboration and innovation will drive Vietnam towards a sustainable energy future powered by offshore wind.

 

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Britain Prepares for High Winter Heating and Electricity Costs

UK Energy Price Cap drives household electricity bills and gas prices, as Ofgem adjusts unit rates amid natural gas shortages, Russia-Ukraine disruptions, inflation, recession risks, and limited storage; government support offers only short-term relief.

 

Key Points

The UK Energy Price Cap limits per-unit gas and electricity charges set by suppliers and adjusted by Ofgem.

✅ Reflects wholesale natural gas costs; varies quarterly

✅ Protects consumers from sudden electricity and heating bill spikes

✅ Does not cap total annual spend; usage still determines bills

 

The government organization that controls the cost of energy in Great Britain recently increased what is known as a price cap on household energy bills. The price cap is the highest amount that gas suppliers can charge for a unit of energy.

The new, higher cost has people concerned that they may not be able to pay for their gas and electricity this winter. Some might pay as much as $4,188 for energy next year. Earlier this year, the price cap was at $2,320, and a 16% decrease in bills is anticipated in April.

Why such a change?

Oil and gas prices around the world have been increasing since 2021 as economies started up again after the coronavirus pandemic. More business activities required more fuel.

Then, Russia invaded Ukraine in late February, creating a new energy crisis. Russia limited the amount of natural gas it sent to European countries that needed it to power factories, produce electricity and keep homes warm.

Some energy companies are charging more because they are worried that Russia might completely stop sending gas to European countries. And in Britain, prices are up because the country does not produce much gas or have a good way to store it. As a result, Britain must purchase gas often in a market where prices are high, and ministers have discussed ending the gas-electricity price link to ease bills.

Citibank, a U.S. financial company, believes the higher energy prices will cause inflation in Britain to reach 18 percent in 2023, while EU energy inflation has also been driven higher by energy costs this year. And the Bank of England says an economic slowdown known as a recession will start later this year.

Public health and private aid organizations worry that high energy prices will cause a “catastrophe” as Britons choose between keeping their homes warm and eating enough food.

What can government do?

As prices rise, the British government plans to give people between $450 and $1,400 to help pay for energy costs, while some British MPs push to further restrict the price charged for gas and electricity. But the help is seen by many as not enough.

If the government approves more money for fuel, it will probably not come until September, as the energy security bill moves toward becoming law. That is the time the Conservative Party will select a new leader to replace Prime Minister Boris Johnson.

The Labour Party says the government should increase the amount it provides for people to pay for fuel by raising taxes on energy companies. However, the two politicians who are trying to become the next Prime Minister do not seem to support that idea.

Giovanna Speciale leads an organization called the Southeast London Community Energy group. It helps people pay their bills. She said the money will help but it is only a short-term solution to a bigger problem with Britain’s energy system. Because the system is privately run, she said, “there’s very little that the government can do to intervene in this.”

Other European countries are seeing higher energy costs, but not as high, and at the EU level, gas price cap strategies have been outlined to tackle volatility. In France, gas prices are capped at 2021 levels. In Germany, prices are up by 38 percent since last year. However, the government is reducing some taxes, which will make it easier for the average person to buy gas. In Italy, prices are going up, but the government recently approved over $8 billion to help people pay their energy bills.
 

 

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