A recent report by Sky News highlights a sharp surge in wholesale natural gas prices, with UK day-ahead gas costs rising by more than 40% in January. Analysts describe the situation as a “perfect storm” driven by colder winter weather, reduced liquefied natural gas (LNG) imports, lower European storage levels and geopolitical pressures.
While wholesale markets can feel distant from everyday households and businesses, the reality is that rising gas prices almost always translate into higher electricity bills. Here is why – and why more UK consumers are turning to solar PV and battery storage to regain control.
Why Rising Gas Prices Push Electricity Bills Up
The UK’s electricity system remains closely tied to gas:
- Gas fired power stations play a major role in meeting national electricity demand, particularly during cold spells and periods of low wind. During the recent cold snap, gas generation exceeded 50% of total UK electricity supply on several days.
- When the cost of gas rises, the cost of producing electricity rises with it, pushing up wholesale electricity prices.
- These whole increases feed through to higher fixed rate tariffs when deals are renewed and upward pressure on the Ofgem energy price cap, with the next review due to take effect from April.
Sky News notes that an extended period of elevated gas prices increases the likelihood of that both fixed deals and the price cap will rise, exposing households and businesses to higher costs in the months ahead.
A Volatile System Beyond UK Control
One of the key takeaways is that gas prices are largely influenced by global factors outside the UK’s control:
- LNG shipments diverting to Asia where prices are higher
- Declining North Sea gas production
- Weather driven demand spikes across Europe
- Geopolitical risks affecting supply and speculation in energy markets
Even with record investment in renewables, reliance on has during peak demand means price volatility remains baked into the system.
Why Solar Power Breaks the Link to Gas Prices
Solar photovoltaic (PV) systems fundamentally change how energy is consumed. Solar electricity is generated on-site, meaning it is not exposed to wholesale gas prices. Once installed, the cost of generation is fixed and predictable for decades. Pairing solar with battery storage allows excess daytime generation to be used in the evening – precisely when grid electricity is most expensive and most gas dependent. This is why solar is increasingly seen not just as a green upgrade, but as a financial hedge against energy volatility.
The Bigger Picture: Energy Security and Stability
The government has repeatedly stated that reducing exposure to gas price volatility is a major driver behind the UK’s push for renewable energy. Recent offshore wind auctions secured record capacity, but higher strike prices show that transitioning the national grid takes time and cost pressures remain in the short term.
For homeowners and businesses, solar offers an immediate solution to reduce reliance on gas linked grid electricity, every unit of self-generated electricity you use, is a unit of grid electricity you don’t need to buy. Long term, energy bills are reduced and you improve your resilience against future price hikes.
How SolarTherm UK Can Help
At SolarTherm UK, we design and install tailored solar PV and battery storage systems for homes and businesses across the South East. Our systems are engineered to maximise self-consumption, reduce grid reliance and protect customers from the kind of gas-driven price spikes now dominating headlines.
As wholesale gas prices rise again, solar remains one of the few proven ways to lock in lower energy costs and take control of your electricity bills.
Contact SolarTherm UK today for a free, no obligation quote and design, tailored to your property, usage and future energy needs. No hard sell, just honest, expert advice.
Your home. Your energy. Your future.
