MPs urge Britain to keep close energy and climate ties to the EU
04 May 2017 | Adaptation
The U.K. should keep its energy and climate change relationship with the EU as close to the status quo as possible in the next few years, without leaving the internal energy or emissions trading markets, British MPs said Tuesday.
In a report on the country’s Brexit negotiating priorities, the Business, Energy and Industrial Strategy Committee worries that the U.K. will become a rule-taker after Brexit. Members of the committee are also concerned that an immediate break from the EU markets will disrupt the country’s energy market and energy-intensive industries.
“We recommend that the government seeks continued access to the internal energy market, with no accompanying tariffs or barriers to trade,” the committee said.
To make sure the U.K.’s gas and electricity links to EU states continue to run efficiently, the country should also stick to the bloc’s network codes, which are designed to harmonize its regional markets, it said. Remaining a member of European technical institutions would allow the U.K. to continue taking part in setting rules.
The report follows the committee’s months-long inquiry, during which energy experts and industry representatives expressed significant concerns about the effects of Brexit on the country’s energy prices, security of supply and the safety and growth of its nuclear energy sector. Business and Energy Secretary Greg Clark acknowledged to the committee in April that a hard break from the EU’s internal energy market would be a “bad thing,” but remained vague about the country’s future relationship with the EU’s Emissions Trading System (ETS) and other areas.
The committee said it was especially concerned about the U.K.’s departure from the EU’s atomic energy community, Euratom, and urged the government to seek to delay the exit until new arrangements can be put in place to regulate the trade of nuclear fuel, equipment and workers. Nuclear industry representatives told the MPs that the U.K. could replace its membership of Euratom with agreements with the International Atomic Energy Agency and other countries that use nuclear energy, such as the U.S. However, they warned, it will take longer than the two-year Brexit negotiating window to finalize these deals.
“The government has failed to consider the potentially severe ramifications of its Brexit objectives for the nuclear industry. Ministers must act as urgently as possible,” Iain Wright, the committee’s chair, said in a statement. “The continued operations of the U.K. nuclear industry are at risk.”Wright is a Labour MP from Hartlepool, northern England, which is home to a nuclear power station. He has announced he won’t run for re-election in June.
The committee also urged the U.K. to remain a member of the EU’s emissions trading market, at least until the current trading phase ends in 2020. However, the MPs acknowledged that the ETS is “performing poorly” because of an oversupply of pollution permits and low prices.
The best option would be for the government to negotiate a longer-term membership of the ETS, on the condition of future reform to bring its prices in line with the U.K.’s national price floor for carbon emissions from power stations, it said.
“If sufficient reforms to the EU ETS do not appear achievable, we recommend that the government considers alternative options, such as establishing a separate U.K. system linked with wider international schemes,” the committee said. However, it shouldn’t pull out until it has established “clear and well-tested alternative approaches.”
The report comes a day after the U.K. parliament’s Northern Irish Affairs Committee warned that Brexit risks depriving Northern Ireland of valuable EU funding and logistical support for energy infrastructure projects that otherwise would not be commercially viable.