Brexit puts the UK’s current frictionless trade in energy
with the EU at risk. This
is amongst the findings
from the House of Lords’ EU Energy and
Environment Sub-Committee’s report Brexit: energy
security, published today.
The EU is a key energy trading partner for the UK, supplying
approximately 12% of the UK’s gas and 5% of
electricity. The UK will need to continue
to trade energy with the EU in order to meet demand, but if such
trade takes place outside the Internal Energy Market it is likely
to be less efficient. This creates the potential for higher
energy bills, and leaving the EU could risk supply shortages in
the event of extreme weather or unplanned generation
outages.
The Committee urges the Government to set out how it will
work with the EU to anticipate and manage supply shortages, and
to assess what impact leaving the Internal Energy Market would
have on the price paid by consumers for their energy.
The Committee has also stressed that the Euratom treaty is
fundamental to the current functioning of nuclear energy
generation in the UK. Failure to replace its provisions by the
point of withdrawal could result in the UK being unable to import
nuclear materials, bringing the UK’s civil nuclear industry to a
halt.
The Government is taking measures to avoid this worst
case scenario but, given the risk to the UK’s energy security if
replacement provision is not in place in time, the Committee call
on the Government to ensure contingency arrangements are in place
and to review the possibility of a Euratom-specific transition
period separate from the wider Brexit process.
Other potential challenges to the UK’s energy security
highlighted by the Committee include:
- Without
access to specialist EU workers, there are serious concerns over
whether the construction of new nuclear generation sites
(including the Government’s flagship Hinkley C project) is
feasible.
- EU
investment has made an important contribution to constructing and
maintaining a secure energy system in the UK. Replacement of this
funding is critical to ensuring sufficient infrastructure is in
place to enable future energy trading.
- The
UK's influence of future energy policy is likely to be severely
constrained post-Brexit. The Government should conduct a frank
assessment of its potential degree of influence, taking
particular note of the difficulties faced by other non-EU
countries such as Switzerland and Norway.
, Chairman of the EU Energy
and Environment Sub-Committee, said:
“Individuals and businesses across the UK depend on a reliable
and affordable supply of energy. In recent years, the UK has
achieved such a supply in partnership with the EU, working with
other Member States to make cross-border trade in energy easier
and cheaper.
“Over the course of the inquiry the Committee heard about the
benefits of the UK's current energy relationship with the EU, and
the Minister acknowledged these benefits when he stated his hope
that Brexit would result in as little change as possible. It
remains unclear, however, how this can be achieved, without
remaining in the single market, IEM and the other bodies that
develop and implement the EU's energy policy.”
