Every minute of every day, five thousand times as much energy as we need hits the earth in the form of solar energy. That surplus isn’t going anywhere; it just gets absorbed into buildings, into the ground, the desert or the sea, warming everything up.
But what if we could harness more of that? What if we could make energy as abundant as data on the internet? Imagine the global problems we could solve. In my opinion, this is not only possible; it’s beginning to happen right now.
However, before we can begin to see a real step-change, we must address the perpetually complex question of what’s truly going to drive that momentum and turn us into a more independent and sustainable society.
To begin to answer that question, let’s first look at the influence of global markets on the UK’s fuel and energy production, and the ever-present concern that we’ll eventually run out of resources. Ten years ago, the world was focussed on peak oil; we thought we were going to run out of it and that it would get really expensive – but the reverse is now happening.
The business models of fossil fuel companies have failed in that respect. The price of oil has fallen to around $50 a barrel and is likely to stay there. So effectively, what happens is that it’s not worth extracting oil anymore because people don’t want it in sufficient quantities. We’re not going to run out of oil, because demand will continue to fall.
But gas and electricity are different, because of the way they’re being generated. Gas extraction is a complex issue; we’ve had a lot of gas coming onto the market in the US from shale, but the price plummeted so they stopped producing. We now have gas coming from Russia through huge pipelines, and from Qatar as liquid natural gas in giant containers.
Both of these sources are politically disruptive, and if there was any fluctuation in production we’d have a short-term supply issue which would drive up cost. Energy companies won’t absorb these variables, so they’ll always be passed onto us as consumers. And while we’ve seen fewer price hikes in recent years compared to around five years ago, political and event-led drivers make the market volatile and unpredictable.
Check out Part Two in our Sustainability Series to find out whether Brexit will have an impact on our gas and electricity prices.