European Energy Crisis 101
Updated: Nov 3, 2021
Written By: Maya Ardon
"The cost is now six times higher than what it was last year in Europe and is predicted to keep increasing"
Energy costs across Europe have been rising tremendously, specifically natural gas and power. As Europe’s economy recovers from the COVID-19 pandemic and its lockdown, rising demand for gas is being met with limited supply and high prices (Fleming, 2021). Power prices are essentially moving along with the soaring natural gas prices, and a combination of lower-than-usual gas reserves and lower imports is exacerbating the shortage. According to EuroNews, the cost is now six times higher than what it was last year in Europe and is predicted to keep increasing (Chadwick, 2021). Several reasons are fueling or contextualizing this crisis, including a rising global demand for natural gas from its lower consumption levels in 2020 (due to changes during COVID-19), Europe’s reliance on imports (specifically, from Russia), the onset of a cold winter placing reliable fuel in high demand, and the inability for renewables to fill the space (Fleming, 2021). Further, according to the International Energy Agency, the demand is greater than the maximum demand growth that would be needed to make the target of net-zero emissions by 2070 (Fleming, 2021).
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Chadwick, L. (2021, October 25). Europe's energy crisis: Five charts to explain Europe's energy price crisis. euronews. Retrieved November 2, 2021, from https://www.euronews.com/2021/10/25/europe-s-energy-crisis-five-charts-to-explain-why-your-bills-might-go-up-this-winter.
Fleming, S. (2021, October 13). 5 things you should know about Europe's energy crisis. World Economic Forum. Retrieved November 2, 2021, from https://www.weforum.org/agenda/2021/10/5-facts-europe-energy-crisis/.