Current and former politicians agree investment will be affected by Brexit but they have different views regarding the impact on the energy sector.
Brexit gives the UK the opportunity to set its own rules and control the power sector, according to Alan Duncan, MP for Rutland and Melton.
Speaking to ELN after the UK voted to leave the EU he said: “You can still get a good return on your investment and we of course will be able to make our own rules if you like, our own competition policies so we will be in control so in that sense it could be an advantage but there will be currency fluctuations now so people will have to factor in their investment decisions a larger degree of political and currency risk than they had to do before.”
However, he also believes a “two-year or longer period of negotiation” could make people “suspend investment decisions”.
Political Commentator Alastair Campbell agrees investment in the medium term “is not going to be good”.
Mr Campbell, who worked as Director of Communications and Strategy for former PM Tony Blair told ELN: “In the medium term I would say that it’s not going to be good and that would appear to be the obvious response from the markets so as to how that gets stabilised, I don’t know. The economy, the government’s obviously trying to reassure markets and tell people the fundamentals are strong and so forth but the words can only go so far. We all know that in a globalised economy we have a situation where companies can move.
“I think if you had a few really big brand names who suddenly said ‘you know what? we are not staying there, we can’t be in the single market’ people will start to rue what they’ve done I fear.”
The energy sector is “partially insulated” from Brexit because it “depends very much on global factors”, said former Business Secretary Vince Cable.
He added although oil and gas prices are the main drivers in the industry, the “general investment climate is not going to be good for a while”.
However, John Redwood, MP for Wokingham said the UK would have “national control” over energy policies once it leaves the EU.
He also believes energy bills will be lower for households following former Mayor of London Boris Johnson’s pledge to cut the VAT.
Mr Redwood added: “We’ll get our money back that we currently have to give as contribution to the European Union and we promised that we would get rid of VAT, the European tax on fuel and that’s what we want to do. We are urging the government to do that as soon as possible and that would take 5% off everybody’s domestic fuel bill.”
Stanley Johnson, environmentalist and father of leader of the Leave campaign Boris Johnson, calls for a new green taskforce to negotiate the UK’s exit from the EU.