How to fix the world’s energy emergency without wrecking the environment

This year’s energy shock is the most serious since the Middle Eastern oil crises of 1973 and 1979. Like those calamities, it promises to inflict short-term pain and in the longer term to transform the energy industry. The pain is all but guaranteed: owing to high fuel and power prices, most countries are facing soggy growth, inflation, squeezed living standards and a savage political backlash. But the long-run consequences are far from preordained. If governments respond ineptly, they could trigger a relapse towards fossil fuels that makes it even harder to stabilise the climate. Instead they must follow a perilous path that combines security of energy supply with climate security.

In Europe what was long imagined as a nightmare of freezing midwinter nights has instead erupted as a midsummer fever dream. A heatwave forced Spanish gas demand to near-record highs, even as, on June 14th, Russia began to lower the flow of gas along the Nord Stream 1 pipeline to western Europe, sending prices soaring by 50% and raising fears that rationing may be introduced later this year. Elsewhere, Americans are paying $5 for a gallon of petrol (€1.25 a litre), fuelling the inflation that opinion polls say is their biggest worry and President Joe Biden’s worst headache. Australia’s power market has failed. Everywhere you look there are shortages and fragility.