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UK Energy Outrage

The global energy crisis has emerged as one of the key disruptors of the past two years, leaving individuals and businesses facing higher-than-expected bills and the threat of energy shortages. But how did it come about? And what does the future hold?

Crises rarely form in a vacuum. They’re the product of a host of contributing factors, triggered by external events that damage certainty and offset the status quo. Such is the case with the present energy emergency which came about through a succession of issues and problems that were impossible to predict.

With the world emerging from a post-Covid slump it created a rapid economic rebound which meant prices begin to soar. The huge increase in gas prices forced some energy suppliers in the UK to go out of business. By the end of December 2021, 28 energy companies closed their doors, affecting over two million customers. All told, gas prices in the UK more than quadrupled during this period to 180 pence per therm. In September 2021 alone, the price of gas rocketed by 70%.

The February 2022 conflict between Russia and Ukraine caused further difficulties with the UK’s energy supply. Although the UK does not directly import its gas from Russia, many countries reduce or end their gas imports from the latter, causing a scarcity of available gas as a result.

Russia reduced natural gas flows through Nord Stream, with supply running at 40% capacity in June 2022. Flow is reduced further in July, before being shut down fully in August. The general situation is very bleak indeed!

So, what does the future of the energy crisis look like? And, more importantly, when can energy users expect a return to normality? Well, unfortunately the UK isn’t quite out of the woods yet, with many in the industry predicting a continuation of the energy crises.

The bad news is that it’s predicted that the UK will still be facing similar issues this coming winter. Experts believe high prices will continue the norm across the country. The UK should be providing a more self-sufficient energy supply by around mid-2024.

There are some positives to speak of, as more sustainable products make their way into the market, and new sources of gas are utilized meaning prices should start to stabilize if not, drop a few percentage points.

Have a terrific day!

Prof. Carl Boniface

Vocabulary builder:

Soar (v) = fly, ascend, increase, climb, rise, mount, (ant) plummet, fall

Scarcity (n) = shortage, lack, insufficiency, scarceness, inadequacy

Bleak (adj) = unwelcoming, miserable, drab, dreary, depressing

Out of the woods (idiom) = out of difficulties, danger or trouble, as in, “We're through the worst of the recession—we're out of the woods now, or, “That pneumonia was serious, but Charles is finally out of the woods.” This expression, alluding to having been lost in a forest, dates from Roman times; it was first recorded in English in 1792.

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