Splitting from European energy market could push up costs, report warns

The UK government must keep co-operating with the EU post-Brexit on energy and climate change, according to a new report.

Negotiating Brexit by the think tank Green Alliance calls on the government to retain access to the European internal energy market, which meets 7% of UK’s electricity needs and helps keeps consumer energy bills down.

According to the report, the internal energy market and its rules and principles have ‘served British interests well’.

The report also warns Brexit could put access to the European Investment Bank at risk, which has ‘underpinned the success of the UK offshore wind and electric vehicle sectors’.

It also calls on the government to reconsider the hard line on the role of the European Court of Justice (ECJ), which it says plays a significant role in governing the shared energy and climate rules across the EU and countries in the wider energy community.

The report also warns Whitehall against diverging from EU product standards and environmental principles, which could undermine UK competitiveness.

‘Sustained co-operation will mean the UK can continue to stand with the EU at the forefront of international leadership on climate,’ said report author, Chaitanya Kumar.

‘It will also maximise the benefits of low carbon trade with Europe and support the shared vision of long term energy security. Not least, it will secure clean and cheap energy for UK consumers.’

Earlier this month, a House of Lords committee launched a new inquiry into the implications of Brexit for the UK’s energy security.

The cross-party EU energy and environment sub-committee said it wanted to examine the UK’s approach to funding energy infrastructure investment and energy research post-Brexit.

Announcing the inquiry, the committee said: ‘Leaving the EU exposes the UK energy system to some critical uncertainties, with potential impacts for both industry and consumers.’

And last week, environment secretary Michael Gove outlined his vision for a ‘green Brexit’ and said ‘we must give thought to how we can create new institutions to demonstrate environmental leadership and even greater ambition’.

‘We should not aim simply to halt or slow the deterioration of our environment,’ said Mr Gove.

‘We must raise our ambitions so we seek to restore nature and reverse decline. This government was elected on a pledge to be the first to leave the environment in a better state than we inherited it.’

A powerhouse investor for the UK economy

The executive director of RenewableUK, Emma Pinchbeck said energy is a ‘powerhouse infrastructure investor for the UK economy’ and ‘it’s crucial for the government’s industrial strategy that investors have the certainty they need to continue to be attracted to the UK’.

‘For this to happen, the government needs to prioritise access to the internal energy market, and to ensure we have the workers we need, as well as providing clarity on future carbon price arrangements,’ she added.

While the Renewable Energy Association’s head of policy, James Court warned Brexit poses many ‘known unknowns’ for the UK’s renewable energy and clean tech sectors.

‘These “known unknowns” can be reduced, or softened, by taking action like retaining links to the EU emissions trading system, delivering on our renewable energy targets, fully supporting and transposing strong energy efficiency regulations, retaining the Industrial Emissions Directive and maintaining transport emissions standards on par with the EU,’ said Mr Court.

‘The government must now set out the nature of the new governance bodies that will be required once the repeal bill has successfully copied EU environmental legislation into UK law. The independence and authority of these bodies will be essential to reinforce our strong climate and environment standards in the UK.’

The nuclear option

One of the biggest energy issues in recent months is whether the UK remains a member of the Euratom nuclear research and training programme after it leaves the EU.

Speaking earlier this month in parliament, Brexit secretary David Davis confirmed the UK will quit Euratom in 2020.

‘However, the UK and the EU have a strong mutual interest in continuing to cooperate on civil nuclear matters, harnessing shared expertise and maximising shared interests, for instance in nuclear research and development,’ he told MPs.

But there has been strong opposition to the move in Westminster, including a debate organised earlier this month by the backbench MP Albert Owen, and a recent

joint column by Rachel Reeves and Ed Vaizey in the Sunday Telegraph urging a rethink of the Euratom exit.

Speaking to Environment Journal, the chief executive of the Nuclear Industry Association, Tom Greatrex said the sector has made it ‘crystal clear to the government that our preferred position is to maintain membership of Euratom’.

‘The nuclear industry is global, so the ease of movement of nuclear goods, people and services enables new build, decommissioning, research and development and other programmes of work to continue without interruption, and without new arrangements there is scope for real and considerable disruption. 

‘There is still time for the government to review its position and explore all of the options available to them.’

‘However, if the UK ceases to be part of Euratom, then it is vital that the government agree transitional arrangements, to give the UK time to negotiate and complete new agreements with EU member states and third countries including the US, Japan and Canada who have Nuclear Cooperation Agreements within the Euratom framework.’

Photo by DECCgovuk