At a recent Chatham House dinner, organised by Curia and Intercontinental Exchange (ICE), and chaired by Bill Esterson MP, chair of the Energy Security and Net Zero Select Committee, policymakers, industry leaders, and academics discussed answers to the challenges that lie ahead in building a sustainable energy ecosystem
The Government has laid out its ambition to transform the UK into a global leader in renewable energy by 2030. This is a vision that merges industrial strategy with economic resilience, placing energy at the heart of the UK’s long-term economic survival.
This transition is not an abstract policy debate; it has real, tangible consequences for communities across the UK. Coastal towns are poised to benefit from the growth of offshore wind jobs, while the nation seeks to alleviate the pressure of rising energy bills and an insecure energy market amid growing global tensions.
But the energy revolution is not simply a shift from one system to another, it “isn’t just about technology, it’s about capital. It’s about building a new system before we dismantle the old one.
“This takes trillions and it takes trust in markets. Markets aren’t perfect, but they are powerful. And when stewarded wisely, they remain our best hope for a faster, fairer and more resilient energy future.”
At a recent Chatham House dinner, chaired by Bill Esterson MP, chair of the Energy Security and Net Zero Select Committee, and organised by Curia in partnership with Intercontinental Exchange (ICE), policymakers, industry leaders, and academics discussed how the UK should push forward and answer some of the most challenging questions of our time:
- Can we create a truly flexible and resilient energy market?
- How do we ensure that communities are fully engaged in this transformation?
- When do we leave markets to flow freely, and when do we intervene?
Thought leaders attending the dinner included Managing Director Utility Markets and Global Head of Environmental Markets at ICE, Gordon Bennett, President of ICE Futures Europe, Chris Rhodes and academics including Professor of Energy & Environmental Sciences, Alona Armstrong. The dinner also welcomed Energy Minister, Michael Shanks MP and representatives from the Department for Energy Security & Net Zero, GB Energy, and Low Carbon Contracts Company.
Balancing the ‘pressure to act’ in the short-run with long-term stability
In the wake of Russia’s invasion of Ukraine and the ever increasing threat of climate change, “the pressure to act” and to intervene in the energy market has been “immense”.
But the “UK held its nerve”, this trust, and careful stewardship, is what energy experts argued must be prioritised and maintained when looking forward to the UK’s energy security. We must become comfortable with “letting the market do its work”, one expert said, avoiding reactionary actions that mask long-term problems with short-term fixes.
Despite good intentions, implementing measures like price caps does little to solve the root problems of energy insecurity and rising energy costs.
“The price is the signal”, one expert said, “when scarcity drives a crisis, hiding the price doesn’t solve the problem, it hides the signal”, making the decisions on “where to send supply, where to reduce demand, and where to invest” more difficult and less informed.
The UK has proven it can be a responsible steward of markets, resisting the urge to intervene when times are tough, understanding that markets don’t “cause volatility, they help us survive it.” by “giving participants the tools to hedge, to plan, to invest” in the areas that require it.
Technological Innovation: The Core of the Transition
The UK remains at the centre of the energy transition: It possesses immense natural potential for high levels of efficient clean energy, the technical expertise to create safe and efficient infrastructure quickly, what it requires now is sensible and focussed governance to guide the transition.
The guests agreed that Britain’s energy future rests on a diversified portfolio of emerging technologies, from floating offshore wind and tidal energy projects to next-generation nuclear reactors, the UK could harness various sources of energy, creating not only a secure energy grid, but also creating new high-skill jobs across the country.
In the process, the Government must also consider job displacement in traditional energy sectors like coal and gas. While the transition opens new high-skill job opportunities in the green economy, it is essential that these are paired with retraining programmes and geographical mobility support to ensure that communities are not left out of the benefits of the energy transition.
Market Dynamics: Navigating Complexity
One expert spoke on the important role that everyday people, emotions and actions have on markets. They explained that energy markets are not just economic systems; they are the beating heart of the transition, charged with uncertainty and volatility.
The reaction of the market mirrors the reaction of its buyers and sellers: “They respond to fear, to policy, to weather, to war. Markets capture that human complexity in real time”, they said.
The shift to a renewable energy market means that not only will capital be moved in the most efficient way, but also “in the most sustainable way”. This will require substantial investment, both public and private, but more importantly, it demands a marketplace that is flexible, transparent, and able to absorb the volatility of energy prices while maintaining stability, it requires trust to be built between the markets and its consumers, between businesses and individuals.
The Broader Societal Impacts
The energy transition is not a purely economic matter: “It’s not just about paying your energy bill; it’s also about your food bill”, one expert said.
The price question is central to the debate. How can the Government reassure a public increasingly concerned about escalating energy bills that renewables are going to improve their lives more than fossil fuels when “it may not be cheaper”.
As energy prices continue to rise, the cost of living for many households is becoming increasingly unsustainable. For a successful and just energy transition, it is not enough to simply shift to renewable sources. The public must feel that the transition is fair and benefits them directly.
One expert explained the Government’s strategy, saying: “The key thing about the clean power missions of the Prime Minister is that it doesn’t exist in isolation.
“Things like long duration energy storage, things like building the network grid. This is all about trying to reduce some of the costs we’re currently paying out. We’re currently paying out in constraints. All of these things are important, they don’t immediately lead to reductions and bills”, but building a whole new system, one that is better for the world, will eventually lead to more stability and lower prices.
“So price does matter. What consumers pay equally matters. It matters at the ballot box. But so too do some of the other things we’re trying to build in terms of jobs and investment. Action on the climate does matter”, they add.
Global Implications
The UK’s energy revolution is not unfolding in isolation. Across Europe and beyond, countries are increasingly viewing clean energy not just as an environmental responsibility but as a matter of national security and economic survival.
From Ukraine to the Baltics, nations are recognising the strategic importance of a secure and sustainable energy future, positioning themselves as key players in the global clean energy transition.
Final Thought
The implications of this transition extend far beyond the energy sector. This is about securing Britain’s economic resilience, creating high-quality jobs, assuming leadership in technological innovation, and fulfilling climate commitments.
The UK stands at a pivotal moment. The decisions made in the coming years will determine whether the nation’s energy revolution becomes a model for global transformation or remains a well-intentioned but ultimately inconsequential policy initiative.
Securing the UK’s energy future will require bold leadership, strategic foresight, and political will. The Government must be comfortable favouring long-term stability over short-sighted intervention.
Our energy security requires that the price signals of markets are understood as signs that attention is required in underperforming areas, rather than being an excuse to implement politically popular but unsustainable measures that do little more than burrow our head in the sand.
Featured image via Nordic Studio / Shutterstock.
