When Vladimir Putin invaded Ukraine, he hoped to weaken the Western response by holding over Europe its dependence on Russian energy imports. In September 2022, he warned that price caps on Russian gas would leave Europe to “freeze, freeze.” Yet Europe imposed unprecedented sanctions on Russian energy and survived the winter of 2022 with its resolve intact.
However, while Russia’s attempt to weaponise energy sources has not gone as planned, the spike in energy prices continues to cause huge economic and social challenges for many. This proved a particular challenge in the UK. Despite its relative lack of reliance on Russian gas, the UK has been among the most severely impacted European countries when it comes to soaring energy bills and gas prices. With no end to the war in Ukraine in sight, experts warn that the upcoming winter of 2023/24 is unlikely to be much different, with households and businesses continuing to struggle over the coming months. It is vital that we prepare now for the challenging months ahead.
This report finds that Russia’s invasion of Ukraine and the country’s attempt to weaponise energy sources exposed long-term vulnerabilities in the UK’s energy supply. Some structural reasons made the UK particularly exposed to price volatility. In addition, we found that the UK’s energy system more generally suffers from serious flaws, such as a shortage of storage facilities and generally low levels of energy-efficiency among British households.
While there are many things the UK Government could and should do in the long run to improve the situation, the timeframe in which to implement changes is rather limited for the upcoming winter of 2023/24. Thus, we propose a set of realistic policies that, if adopted by the Government with relatively immediate effect, could make the change for the better and help British businesses and households weather the storm during this upcoming winter.