As conflict in the Middle East intensifies, gas markets are reacting in exactly the way energy users have come to fear: sharp price increases, rising volatility and renewed concern over future electricity costs. For UK businesses, public sector organisations and energy-intensive sites, that raises a familiar and frustrating question: if the UK is generating more power from renewables than ever before, why do electricity prices still jump when gas prices spike?

The answer is that, despite huge progress in renewable generation, the UK power market is still structurally exposed to gas. Gas-fired generation still frequently sets the wholesale power price. So even when lower-cost renewable electricity is flowing through the system, the final market price is often determined by the cost of the last gas-fired unit needed to meet demand.

Why decoupling power prices from gas will not solve the problem overnight

There is growing discussion around decoupling electricity prices from gas. In principle, the idea is attractive: if renewables have low running costs, consumers should be able to benefit more directly from that cheaper electricity instead of remaining tied to volatile gas markets.

But market reform does not remove physical dependence on gas in the short term. If gas-fired plant is still needed to keep the lights on, fill renewable gaps and provide system flexibility, then its cost still has to be paid somewhere within the system. Changing the pricing mechanism may alter how costs are allocated or smoothed, but it does not instantly eliminate the underlying gas dependency.

That means decoupling may become part of the answer over time, but it is not a near-term shield against global gas shocks.

The real issue is not too much renewables

Some commentators argue that renewables are the reason UK electricity prices are among the highest in Europe. That is too simplistic. UK electricity prices remain high for a combination of reasons, including continued exposure to gas-driven wholesale pricing, rising network and system costs, the way policy and non-energy costs are recovered, and grid constraints that increase balancing costs.

Renewables are already doing more of the heavy lifting than many realise. The challenge is that the UK has not yet gone far enough in pairing renewables with the storage, flexibility and market design needed to translate low-cost clean generation into lower delivered power costs.

What actually works: onsite renewables, battery storage and flexibility

For organisations looking for greater cost certainty, the most practical response is not to wait for market reform. It is to reduce exposure to the market altogether.

That means investing in onsite renewable generation, such as solar PV and wind where appropriate, battery storage to shift usage and reduce exposure during expensive periods, and flexibility measures so energy demand can respond intelligently to tariff signals and operational priorities.

Instead of remaining fully exposed to imported grid power priced by volatile global gas markets, a site can increasingly meet demand through its own lower-cost generation, optimise charging and discharging with battery storage, and reduce import costs during peak-price periods.

The challenge: knowing what to invest in

Of course, the solution is not simply install solar and a battery. Every site is different. The right answer depends on half-hourly electricity demand, available roof or land area, tariff structure, peak demand exposure, export potential, building usage patterns, operational flexibility, carbon reduction targets, capital constraints and required payback.

A poorly sized system can leave money on the table. An oversized battery can weaken return on investment. A renewable technology that looks attractive in principle may underperform financially once real load patterns, constraints and funding assumptions are applied.

That is why objective modelling matters.

Why OnGen Expert matters now

At a time when gas prices can spike overnight and structural market reform will take years to filter through, organisations need a practical way to identify the most cost-effective route forward now.

OnGen Expert objectively models onsite renewable energy technologies, battery storage and flexibility options to show what will deliver the strongest financial and carbon outcomes for a specific site or portfolio. Rather than relying on guesswork, generic rules of thumb or installer-led assumptions, OnGen Expert helps organisations assess the optimum size of solar PV, wind, battery storage and other technologies, the impact on energy bills and return on investment, how limited capital budgets can be deployed to maximise value, and which combinations of technologies perform best together.

The result is a faster, more robust and more objective route to decision-making.

Want to understand which onsite renewable and storage options will deliver the best return for your site or portfolio? Contact OnGen to see how OnGen Expert can model the most cost-effective pathway to lower energy costs, greater resilience and faster decarbonisation.

Reference notes

• NESO, Britain’s Energy Explained 2025 Review – renewables supplied 63% of UK electricity and gas supplied 26.8% in 2025.
• UK Government, Review of Electricity Market Arrangements (REMA) Summer Update 2025 – market reform is aimed at improving how low-cost power is reflected in bills over time.
• Ofgem, Smart Export Guarantee – exported electricity from small-scale low-carbon generation can create additional site value.