How to combat the UK’s energy crisis

Public and consumer bills are rocketing across the UK, putting intense pressure on workplaces and households and plunging many into energy poverty. At the same time, recent geopolitical events highlight the dangers of reliance on critical resources supplied by a single nation.

Altogether, the EU meets around 25% of its energy demands by importing Russian gas. In 2021 alone, the European Union imported 155 billion cubic meters of Russian gas, accounting for 45% of all its gas imports. Now that boycotts have been called across the continent, energy prices are soaring. The UK of course is a part of this and is also known to house some of more energy-inefficient building stock across Europe.

Clearly, the region requires an energy revolution. Municipalities can lead the charge with an integrated approach that incorporates the following five approaches.

1. Build financial capital

To achieve large-scale energy transitions, municipalities require sufficient budgets. To that end, the European Commission has pledged €1 trillion in sustainable investments via the NextGenerationEU temporary recovery instrument. EU member states must invest 37% of the instrument’s €672.5 billion Recovery and Resilience Facility in support of climate objectives. In the UK there has recently been an announcement on the Energy- Efficiency taskforce that will devise a plan to reduce total UK energy demand by 15% by 2030 compared to 2021 levels across domestic and commercial buildings and industrial processes. The country is waiting to see what steps the task force will take to help the UK progress on its path to a green future.

Making sure that climate funding flows directly to municipalities is key to swiftly and effectively implementing solutions to combat the energy crisis. Financial instruments and innovative business models, such as product-as-a-service offerings, can bring additional environmental and economic benefits forward and help tackle roadblocks due to problematic balance sheets and public debt.

2. Strengthen decarbonisation policies

Cities account for 70% of all CO₂ emissions in the EU. The EU aims to achieve deep decarbonisation of key sectors under its 2050 long-term strategy, an ambition which is at the heart of the EU Green Deal, the union’s aggressive sustainability roadmap.

At a minimum, decarbonisation measures should involve energy efficiency improvements, accelerated electrification efforts, and additional mechanisms to offset unavoidable emissions, including reforestation.

3. Ratchet up renewables

Accelerating the deployment of wind and solar is one of the ten points mentioned by the International Energy Agency’s (IEA) report on reducing Europe’s reliance on Russian gas.

As well as utility-scale projects contributing directly to national power grids, municipalities can encourage and incentivize consumers to deploy rooftop solar photovoltaics through short-term financing mechanisms. A short-term grant program covering 20% of installation costs could double the pace of investment in solar, at a total cost of around €3 billion. Such a program could potentially increase annual output from rooftop solar PV systems by up to 15 TWh—energy that will no longer have to be generated by traditional carbon-intensive energy-producing means.

4. Insulate homes

Energy-efficient heating and cooling is a powerful tool to drive down emissions in the built environment, and offers UK municipalities the opportunity to secure clean energy transitions.

Heat pumps are an energy-efficient and economically reasonable way to heat homes, replacing fossil-fuel powered boilers, but may take some time to scale up. In the short term, municipalities can roll out smart thermostats and ensure that buildings undergo annual maintenance checks of less efficient boilers.

5. Adopt smart and connected lighting

One of the easiest and most inexpensive steps to tacking the energy crisis is to adopt connected LED lighting systems. Managed LED lighting systems can reduce lighting-related energy costs by up to 80%, a far-reaching benefit considering that light accounts for 12% of the world’s electricity consumption.

To give one example of the potential impact, switching to LED lighting in the professional lighting market could reduce CO₂ emissions by 3.9 million tonnes in the UK&I region, the same amount of CO₂ that 175 million trees could sequester in a year. Making the switch would also save 16.1 TWh of electricity, which is equivalent to the annual electricity consumption of more than 4.3 million household

Managed LED lighting retrofits have the potential to reduce the global carbon footprint by 553 million tons per year. LED and connected lighting also afford many other important benefits, including remote maintenance, occupancy sensing, and UV-C disinfection.