The real lesson of the Iran war energy crisis – learn from the last one. 

Adam Berman | 31st March 2026 | Comment, Trade Associations
(Photo by Justin Sullivan/Getty Images)
(Photo by Justin Sullivan/Getty Images)

As war in Iran shocks global oil prices, trade bodies argue that the UK should recognise the importance of renewable energy sources - and begin investing in them.

The world is once again in the midst of an international energy crisis. No one knows when the Strait of Hormuz will reopen, or how much damage critical energy infrastructure will have sustained by the end of this conflict. But what we do know is that we’ve been here before.  Only four years ago, the UK Government spent an astonishing £44 billion supporting homes and businesses from the worst effects of an energy crisis caused by the Russian invasion of Ukraine. The 2022/2023 energy crisis has cast a long shadow over the UK. The full economic impact is hard to quantify, but it was almost certainly in the hundreds of billions once we consider the effects of increased energy costs, inflation, and interest rates.   The conflict today bears little resemblance to 2022 - a different continent, different geopolitics, and very different impacts on energy markets. But for a country like the UK, the similarity between these two events is striking. For the second time this decade, the UK is feeling the effects of massive volatility in international energy markets over which we have little control. The public conversation about the crisis in the Middle East has focussed on many of the same topics as was discussed in 2022.  Why are we so exposed to global prices? How quickly can we change this? Will the Government step in to subsidise energy bills if they get too high? All reasonable questions.      The answers to these questions are fairly straightforward. Accelerating the transition to clean homegrown energy is the long-term solution to safeguarding our energy security and insulating us from international markets. When paired with a rapid electrification of our economy, we can break the link once and for all between our domestic energy prices and geopolitical instability thousands of miles away.  We have made progress since 2022. When Russia invaded Ukraine, around 40% of our electricity demand was serviced by gas-fired power stations. Today, that’s down to 27%, largely because of a substantial increase in renewables capacity, rising from around 40% of overall power generation in 2022 to 63% today. What does that mean in terms of prices? The more clean power we introduce to the grid, the more that homegrown energy sets our electricity prices and not international gas markets. But the benefits of increasingly clean homegrown electricity can only go so far if we continue to use boilers powered by natural gas, and cars fuelled by petrol and diesel. On the demand side, our success is a bit more mixed. Whilst the UK has seen a rapid increase in the take-up of EVs - every one in five new cars sold is an EV - they still only make up around 5% of all cars on the road. And although heat pump installation grew by 27% last year, it remains the case that only 1% of all UK homes have one.  To state the obvious, every new EV or heat pump reduces the country’s reliance on oil and gas. We are currently in the middle of the most powerful conceivable reminder of why clean homegrown energy and electrification is the future. It’s not because renewable power is clean, although that is of course a significant benefit. It’s because it’s ours.  In 2022, we passed up the opportunity to respond to the crisis in a way that made us resilient to future shocks. Let’s learn the lessons of the last crisis and do things better this time. Whilst large-scale clean generation with its supporting network infrastructure is hard to accelerate significantly, that is not the case on the demand side. To put this in context, in 2022 the UK installed just over thirty thousand heat pumps. Italy installed five hundred thousand.  We should be looking to make it much more attractive to install heat pumps, solar panels and batteries, and move to an EV. Investment comes at a cost. But it is orders of magnitude cheaper than leaving us vulnerable to the impacts of yet another energy crisis that we didn’t cause.  As bills go up – we do know that energy bills will unfortunately increase from July, but the precise amount is uncertain – the Government will be left with a clear choice. Do they follow the 2022 playbook, or look to use this as a clear line in the sand? If it is necessary to intervene to bring down bills universally across the country, the priority should be lowering electricity costs. The combination of lower electricity prices relative to gas, and support for clean technologies are the most powerful steps we can take to both support households and insulate us from future price spikes. If yesterday was the best time to electrify our economy and make energy crises the thing of the past, then the next best time is today.  Adam Berman is Director of Policy and Advocacy at Energy UK ...

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