Brexit and Energy: Cost, Security and Climate Policy Implications
25 May 2016
The UCL Institute for Sustainable Resources and the UCL European Institute have released a new paper today on Brexit and the impact on UK climate and energy policy.
This paper, written by Professor Michael Grubb, UCL ISR and Stephen Tindale, Director, Alvin Weinberg Foundation analyses the implications of Brexit for the UK’s energy sector. Despite significant uncertainties, the experience of other non-EU countries and the UK’s past role in EU discussions allow broad predictions of the consequences for UK energy operations and trade.
In the short term, the impact would be limited because EU rules (the acquis communautaire) would remain in place. Post-2020 effects would depend on the extent to which Brexit slowed down the construction of new electricity interconnectors (cables carrying electricity to and from Britain), and on the arrangements the UK negotiated with the rest of the EU. This paper considers the three main scenarios for the case of a Brexit: joining the European Economic Area (EEA, like Norway), entering into a Customs Union (like Turkey), or negotiating a Free Trade Agreement (FTA, like Canada).
The impact of Brexit on UK climate and energy policy would also depend on the referendum’s domestic consequences. The Leave campaign appears significantly aligned with desire to weaken environmental policy. A substantial weakening could restrict the terms of energy trade, and would be inconsistent with UK legislation unless the government amended or repealed the 2008 Climate Change Act and repealed UK laws enacting EU legislation such as the Industrial Emissions Directive.
Professor Michael Grubb (Professor of International Energy and Climate Change Policy, UCL Institute of Sustainable Resources)
Stephen Tindale (Director, Alvin Weinberg Foundation)