Why agile start-up innovation is the missing piece in solving the current energy crisis

The global energy system is a remarkable feat of engineering and collaboration. It generates, transports and delivers fuel and electricity across borders and continents to heat our homes, power our industries and keep our global economy running.

It is also inherently fragile, deeply reliant on geopolitical stability, uninterrupted trade routes and coordinated supply chains. The current conflict in the Middle East has laid that fragility bare, adding a new layer of pressure to an already stretched system and casting a long shadow over both energy security and the prospects for a just green transition.

The closure of the Strait of Hormuz – through which 20% of the world's oil and liquefied gas usually passes – has triggered impacts that could be felt for years to come. Brent crude surged past $100 per barrel in March 2026 for the first time in four years, reaching $126 at its peak – one of the largest monthly increases in oil prices ever recorded.

Meanwhile, around one third of global seaborne fertilizer trade passes through the Strait, and unlike oil, the fertilizer sector has no internationally coordinated strategic reserves. Fertilizer prices have more than doubled since the Strait closed, and the UN World Food Programme warns that an additional 45 million people could face acute hunger by the end of 2026 if the conflict continues.

The closure also threatens to derail hard-won progress towards ending our dependence on fossil fuels and shifting towards cleaner energy production. Despite over $2 trillion in clean energy investment in 2024, the World Economic Forum’s Energy Transition Index 2025 found that energy security stalled, emissions hit record highs and only 28% of countries made simultaneous progress across security, equity and sustainability.

This crisis should stir us into action.

While governments and energy companies pull every lever they can to stabilize supply, an often overlooked group of innovators has been working on breakthrough technologies that – given the right support – could help keep energy flowing during shocks, accelerate the green transition and insulate economies against future disruption.

Early-stage start-ups are often seen as too small, too unproven or too risky to bet on. This is reflected in the fraction of total investment channeled towards them each year, with the bulk of capital flowing instead to more established businesses and later-stage scaling rounds. Yet the challenge is not a technical one. The innovations needed – from renewable energy to distributed storage and micro-grids – already exist. Many are cost-competitive and ready to scale. What's missing is the will and the capital to deploy them at speed.

These start-ups are not aiming to tear down existing systems – they are trying to help them adapt. And crucially, they can do it quickly. They are nimble enough to move fast, innovative enough to bypass legacy systems and focused on exactly the breakthrough technologies countries are now desperately scrambling towards.

Take the innovators who are working to decarbonize transportation, one of the sectors most exposed to oil shocks past and present. California-based Infinium converts waste CO2 and renewable energy into fuel for trucks, ships and aircraft, requiring no modifications to existing engines. ETH Zurich spin-out Synhelion produces synthetic fuels from solar heat. SWISS recently became the first airline to fly using solar fuel, produced by Synhelion.

Snowline, based in San Francisco, uses solar-powered refrigeration units that eliminate diesel entirely from cold chain logistics, using on-board AI to monitor temperature and energy use.

Electric power systems are also adapting to this new era of volatility. With demand already set to grow two-and-a-half times faster than overall energy demand by 2030, driven by industrial growth and the rapid expansion of data centres, grids around the world are already under severe pressure.

In Asia, higher oil prices and heatwaves are placing already stretched and inflexible grids under increasing strain and forcing energy-intensive industries to scale back production. Early-stage innovators are stepping in to plug the gap and build resilience.

ElectricFish, for example, has created an intelligent micro-grid combining ultra-fast EV charging and battery storage that can be deployed rapidly where needed. XENDEE’s software optimizes distributed energy sources like solar, microgrids, batteries to lower costs.

Belgian start-up D-CRBN focuses on some of the hardest-to-decarbonize industries like chemicals and manufacturing. Its modular tech converts CO2 into carbon monoxide, which is used in carbon-neutral fuels and polymers – turning a waste product, emissions, into a raw material. The company is already trialling its solution at ArcelorMittal’s steel plant in Ghent.

In sub-Saharan Africa and South Asia, two regions at extreme risk from energy poverty and food insecurity, Uganda-based Mandulis Energy uses agricultural waste to power biomass microgrids, delivering affordable, clean power to rural communities.

These solutions may not replace lost supply overnight, but they can help economies navigate demand peaks by enabling local power generation and giving grids more time to modernize.

But they cannot do it alone. Private and public sector bodies must give start-ups the space to pilot, help de-risk early investment and create regulatory pathways that allow innovation to move fast.

Above all, these companies need ecosystems around them – partners, funders, networks and the institutional support that turns a promising pilot into a scalable solution.

Early-stage innovation is no silver bullet – but, employed quickly and intelligently, it can help in the next energy shock, protecting businesses and ordinary civilians from the worst effects.

The entrepreneurs are ready. Their technologies are ready. Now is the time for us to back them.