The global energy crisis: Causes, effects and solutions

In May 2022, during the World Economic Forum in Davos, the Executive Director of the International Energy Agency (IEA), Fatih Birol, announced that the world was experiencing the first global energy crisis in its history: oil, gas and coal prices soaring simultaneously, with energy security becoming an urgent priority for all governments. That seemed like the worst-case scenario. Until 2026 came along.

Since the outbreak of war between the United States, Israel and Iran on 28 February, the global energy system has entered a phase of unprecedented disruption. Birol himself has described the situation as “very severe”, warning that the world has lost 11 million barrels of oil a day, more than the two major oil shocks of the 1970s combined, with the Strait of Hormuz effectively closed. The price of a barrel of Brent crude exceeded $116, and natural gas prices in Europe soared by more than 30%, more than double pre-conflict levels. The WTO estimates that global trade growth could fall to 1.4% in 2026, compared to 4.6% in 2025.

The causes of this energy crisis are manifold and mounting: structural dependence on geographically concentrated fossil fuels, the still-incomplete transition to renewables and, now, a geopolitical conflict that has turned the Persian Gulf into the epicentre of the greatest energy crisis in recent decades.

An energy crisis is defined as a significant disruption to the supply or affordability of energy that threatens economic stability and national security, and what the world faces in 2026 meets every criterion."

In this context, it is more urgent than ever to review what we learnt in 2022 and what tools we have at our disposal today. The premise of the Sønderborg Action Plan, which the IEA presented that year, “the cleanest energy is the energy we don’t use”, has moved beyond mere rhetoric to become a global strategic necessity.

Unsustainable buildings: Effects of energy crisis in Spain

In Spain, just over half of its primary residences were built before basic thermal insulation requirements were included in technical construction standards. With the recent summer heat and winter rain breaking meteorological records, energy conservation may be desirable, but often unachievable. This reality makes Spain’s building stock one of the key drivers of the country’s energy crisis.

The energy crisis facts for Spain are stark: Back in 2022, Peter Sweatman, author of the Esade report ‘How building renovation can help Spain’s energy independence and decarbonisation’, warned that buildings consumed nearly 30% of the country’s final energy and over 20% of Spain’s gas, and that a third of Spaniards were dissatisfied with the level of insulation in their homes. Four years on, that figure remains unchanged: Spain’s housing stock still accounts for 30% of final energy consumption and 25% of the country’s greenhouse gas emissions, according to Build Up’s Energy Efficiency 2025 report.

The urgency, however, has certainly grown. The Ministry of Housing estimates that more than eight million homes will need to undergo energy-efficiency refurbishment to meet the minimum standards of the European directive by 2030. However, the current refurbishment rate in Spain stands at just 0.08% of the total, far below the 2% annual rate set by the European Commission as a minimum target.

Nevertheless, progress is being made. The government reduced residential energy consumption by 10% between 2020 and 2023, with an average of 540,000 refurbishments per year, and forecasts a 25% reduction by 2030, exceeding the European target of 16%. To speed this up, it has extended personal income tax deductions of up to 60% until the end of 2026 for

For property owners and investors wishing to explore the green financing options available to speed up renovation, the 2026 regulatory framework opens up unprecedented opportunities.

A comprehensive refurbishment can lead to savings of up to 60% on annual energy bills, and homes with the highest energy ratings command a market value that is between 8% and 12% higher: energy-efficient refurbishment is no longer solely a climate-related decision, but has also become an economic and asset-related decision.

Roll out renewables as a solution to the energy crisis

The roll-out of renewable energy in Spain has seen an unprecedented acceleration. The country ended 2025 with over 100 GW of installed renewable capacity, with solar photovoltaic leading the way at 48,038 MW and wind power at 33,021 MW, generating 74.5% of the country’s clean electricity. In the European context, this transformation is a direct response to the European energy crisis; dependence on imported fossil fuels is a vulnerability that only domestic, clean generation can address. One of the most positive consequences of the energy crisis has been, precisely, this forced acceleration of the renewable transition.

The global outlook confirms the trend. According to the IEA’s Renewables 2025 report, global renewable capacity is on track to double by 2030, with an increase of 4,600 GW, with solar photovoltaic accounting for almost 80% of global growth. However, growth has its limits: in Spain, of the 40 GW requested for grid connection in 2025, only 4.5 GW were granted permission, with 83.4% of grid nodes saturated. The bottleneck is no longer technology or investment, but rather grid infrastructure and administrative procedures, which constitute the main obstacles holding back the transition to clean energy.

Added to this is social resistance, which the IEA report itself identifies as a key factor: community acceptance drives solar power forward but holds back wind power. The measures already proposed in the 2022 report “How to reconcile energy independence and decarbonisation goals: key challenges and possible ways to overcome them” by Natalia Collado, Jorge Galindo and Manuel Hidalgo – local dialogue, energy communities and the distribution of economic benefits amongst the affected populations – remain the most effective responses for avoiding the energy crisis in terms of supply. 

With the Strait of Hormuz blocked and oil prices skyrocketing, every megawatt of renewable energy installed is equivalent to a barrel that does not need to be imported, and every resource reused reinforces the role of the circular economy in the energy transition. The global energy crisis is no longer merely a climate policy issue but has become a matter of national security.

Principles to act during the current european energy crisis 

The Sønderborg Action Plan, presented by the IEA in 2022, set out 10 strategic principles to help governments identify, implement and scale up energy efficiency policies. In 2026, with the current energy crisis explained by the conflict in the Middle East and oil prices exceeding $100 a barrel, these principles have gone from being a desirable roadmap to an urgent necessity. The IEA itself updated this framework for action in 2025 in its Energy Efficiency Policy Toolkit 2025, incorporating new case studies and consolidating the three pillars upon which any effective policy must be built: regulation, information and incentives.

Knowing how to avert the energy crisis, or at least mitigate its most severe effects, does not depend solely on governments. Faced with an energy crisis of this magnitude, many of the plan’s strategic measures can and must also be adopted by organisations and citizens: embracing digital innovation, learning from the best international experiences, engaging with communities and, above all, leading by example. The global energy crisis solution cannot be solely found through diplomatic summits; it is also shaped by buildings, businesses and everyday habits.

In this regard, the energy efficiency measures implemented since 2000 have succeeded in reducing household energy bills in advanced economies by up to 20%, and have prevented the need to import 20% more fossil fuels in IEA member countries. The global energy crisis has shown that the cheapest and safest energy is the energy that is not consumed. Reducing dependence, diversifying sources and acting with increasing ambition are, now more than ever, the only rational responses.