A ‘no-deal’ Brexit scenario will prove very harmful for both the EU’s and the UK’s power sectors.
That’s according to a new letter written by Eurelectric Secretary General Kristian Ruby to UK Prime Minister Theresa May and European Chief Negotiator Michel Bernard Barnier, which urges for a deal to be reached to ensure a smooth transition.
It suggests no longer applying Internal Energy Market rules to the UK will cost the UK up to £500 million per year in 2025, as well as the rest of the EU, as a result of less efficient gas and power trading.
It adds recent months have seen the EU Emissions Trading System price rebound, which it says is likely to help drive progress towards cost-effective decarbonisation and enable investments in renewables – the group emphasises it is “imperative that this investor confidence is maintained”.
Eurelectric believes a no-deal outcome will risk mutually beneficial investments such as electricity interconnectors between the UK and Europe, as these projects need to attract various sources of finance and are unlikely to move forward without deep levels of ongoing cooperation.
It also condemns the possibility of weakening collective climate ambitions, reminding the EU of the importance of keeping a “credible, ambitious and united voice” in climate ambitions.
The letter states: “A cost effective, clean and secure energy system underpins our current and future prosperity and impacts on the standard of living of all consumers in Europe including UK energy customers.
“We believe it will be of mutual benefit for a deal to be reached on the withdrawal agreement and it is vital that any political declaration includes energy and climate change as priority areas which are clearly addressed.”