Energy crisis shows that going green is also vital for business

The British economy still has fossil gas pumping through its veins. The consequences of this are expected to be laid bare this winter as the effects of the global gas crisis start to spread through homes, businesses and industry. Last week was a first taste of the financial pain that threatens to cripple Britain’s recovery.

Steelmakers have begun suspending work during the hours when energy prices have surged to successive record highs, and fertiliser factories employing almost 600 workers in the north of England have shut down altogether. More are expected to follow suit as colder weather drives energy markets higher, making it impossible for heavy industry to turn a profit or compete with rivals overseas.

For energy-intensive industries, the fallout of record energy prices has been swift and merciless. However, within months this financial pain will seep through the businesses that make up the wider economy, and into the homes of millions of consumers.

“I hope you have some candles,” remarked one well-regarded market analyst. It may have been a wry reference to the tabloid blackout cliches that last did the rounds in the middle of the last decade, but experts and industry leaders have never been more serious about the risks facing the UK this winter.

In the short term the government should follow the lead of governments across Europe that are already taking action to help hardpressed households. In Spain, this has included a €3bn (£2.6bn) tax raid on the energy companies that stand to benefit from record prices.

In the long term the government needs to end its reliance on the global gas markets by investing more in homegrown low-carbon electricity and green hydrogen. Going green has never made more financial sense.