Blue Earth Summit

As geopolitical tensions once again push global energy markets into volatility, a new debate is emerging in the UK: should Britain reopen the North Sea to secure its energy supply while the transition to clean power continues?

That question has been brought sharply back into focus by Greg Jackson, founder and CEO of Octopus Energy, who this week urged the UK government to reconsider its stance on new North Sea oil and gas development.

Sharing with The Telegraph, Jackson argued that Britain must take a more pragmatic approach to energy security following recent disruptions in global gas markets triggered by tensions in the Middle East.

His intervention has reignited a familiar (and increasingly complex) conversation about the role of domestic fossil fuels during the transition to a low-carbon economy.

 

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A New Energy Shock on the Horizon

Jackson’s comments come as energy markets respond to escalating geopolitical tensions in the Middle East. According to his analysis, global gas prices have doubled in recent weeks following disruptions around the Strait of Hormuz, a critical shipping route for energy supplies.

For the UK, now a significant net importer of gas, this volatility presents both economic and political risks.

Higher gas prices directly affect wholesale electricity costs in Britain because the UK electricity market is still largely linked to the price of gas. Jackson warned that this dynamic could once again drive inflation, increase interest rates and put further pressure on households and businesses.

His conclusion: Britain needs more “sovereign energy.”

In practical terms, that means reconsidering whether domestic gas resources, particularly those in the North Sea, should continue to play a role in the country’s energy system.

 

The North Sea Question Returns

The future of the North Sea has become one of the most contested issues in UK energy policy. Under current government policy led by Energy Secretary Ed Miliband, the UK has committed to ending new oil and gas exploration licences in the North Sea as part of its strategy to accelerate the transition to clean energy.

Supporters argue that new fossil fuel projects are incompatible with climate targets and risk locking the UK into decades of additional emissions.

Critics, however, say the policy risks increasing reliance on imported gas from overseas, often transported long distances as liquefied natural gas, while domestic resources remain untapped.

Jackson falls into the latter camp, arguing that if the UK continues to rely heavily on gas for heating, electricity and industry, it makes little sense to import that energy when it could still produce some of it domestically.

“We should use what’s available from the North Sea,” he wrote. “There’s no point shipping gas from the other side of the world when we have it here.”

 

Not a Silver Bullet

Importantly, Jackson does not present North Sea production as a solution to Britain’s energy problems.

He acknowledges that the basin’s most productive reserves have already been depleted and that domestic gas production would not dramatically lower prices, which are largely set on global markets.

Instead, his argument centres on risk management. 

The UK currently imports a significant portion of its gas, leaving households and businesses exposed to global supply shocks, as seen during Russia’s invasion of Ukraine and again during recent Middle Eastern tensions.

From this perspective, domestic production becomes less about lowering costs and more about improving resilience.

 

A Transition Still Underway

Despite his call for renewed North Sea production, Jackson remains a strong advocate of the energy transition.

In his commentary, he emphasised the need to accelerate electrification and renewable energy deployment across the UK.

He points to several technologies that are already transforming the energy system:

• Solar power, which has fallen dramatically in cost over the past decade

• Wind energy, which now generates electricity more cheaply than gas in many cases

• Batteries, whose costs have dropped roughly tenfold in ten years

Jackson also highlighted technologies such as heat pumps, rooftop solar and grid optimisation as tools that could reduce Britain’s dependence on gas over time.

The broader message is that the transition is underway, but not yet complete.

 

Criticism of “Expensive Distractions”

Where Jackson diverges from some government policy is in his scepticism about certain emerging climate technologies.

In particular, he criticised large-scale public investment in carbon capture and storage and hydrogen projects, arguing that they risk diverting billions of pounds away from more immediate solutions.

His comments add to an ongoing debate about how governments should prioritise investment during the energy transition, between technologies that can scale today and those that may become critical in the future.

 

The Market Design Problem

Another key point raised in Jackson’s commentary concerns the structure of the UK electricity market.

Currently, electricity prices are heavily influenced by the cost of gas because gas-fired power stations often set the marginal price in wholesale markets.

This means that even when renewable energy produces electricity cheaply, consumers may still pay prices linked to expensive gas.

Jackson argues that reforming this system could significantly reduce electricity costs while supporting electrification across transport, heating and industry.

Without reform, he warns, the benefits of cheaper renewable energy will not fully reach consumers.

 

A Debate That Won’t Go Away

Jackson’s intervention has already drawn political attention.

Critics of the government’s North Sea policy, including figures in the Conservative Party, trade unions and some industry leaders, argue that restricting domestic production risks increasing reliance on imported energy.

Meanwhile, environmental groups maintain that expanding fossil fuel extraction undermines climate commitments and slows the shift to renewable power.

Both sides claim to be acting in the interest of energy security.

The real challenge may lie in navigating a transition period where both objectives, decarbonisation and resilience, must be balanced simultaneously.

 

What This Means for the Energy Transition

For the Blue Earth community, spanning founders, investors, policymakers and sustainability leaders, Jackson’s comments highlight a fundamental question facing the transition.

How should countries manage the messy middle between fossil fuels and fully renewable energy systems?

Few experts believe the transition will happen overnight. But there is ongoing disagreement about how quickly fossil fuel production should decline and how to manage energy security in the meantime.

The UK, like many countries, is still heavily dependent on gas for heating, electricity and industrial processes.

Until that dependence is significantly reduced, debates around domestic production, imports and infrastructure are likely to continue.