4 BIG effects Brexit will have on Energy and the Climate
- April 7, 2017
- by Chris
With the triggering of Article 50, we’re all looking at what impact Brexit is going to have on our day-to-day lives. Here’s our take on how Brexit could affect energy prices and climate action.
Strength in numbers or not?
Like our European neighbours, more and more of our gas is being piped in from overseas, with much of it coming from Russia. Many see this increasing reliance on gas from Russia as a risk: our gas supplies and prices could become chips in a high stakes game of foreign policy poker.
To counter this risk, the EU is in the process of putting together a package of energy proposals that will secure and diversify the group’s gas supplies. The proposals will give the EU much greater control over intergovernmental energy agreements between EU and non-EU countries before they’re signed. The aim is to minimise the risk of the taps being turned off.
Now we’re coming out of the EU, we won’t be part of these proposals. While you may think this is a loss, hold on for a moment.
Because on the other hand, the same set of proposals would require EU countries to help each other out in a gas crisis. This could have led to energy shortages and economic downturns in this country because there’s less power to go round.
Will energy bills go up or down?
If you’ve thought about energy bills and Brexit, you’ll be wondering whether they’ll go up or down.
Some say that because the UK isn’t at the European table when it comes to discussions about efficiency, competition and new technologies, there’s a danger energy prices will go up.
On the other hand, some say that the money we are no longer sending to Europe will be available to help more people in fuel poverty in this country.
How will investment in energy be affected?
Much of the energy infrastructure in this country relies on imports from abroad to be built. Take offshore wind farms or the part French-owned Hinkley Point C nuclear power plant project in Somerset as examples.
Because we’re leaving the single market, it seems likely that parts coming in from Europe will cost more post-Brexit. On the other hand, it will also eliminate the EU’s trade duties on items such as Chinese solar equipment imports, which will mean they’re likely to cost less.
The conclusion that most people are drawing is that because of the uncertainty, investment in infrastructure in renewable energy plants or shale gas exploration is likely to be put on hold until discussions are further down the line.
Can the UK still be a leader on climate change?
The UK has traditionally taken the lead on climate change policies. In 2008 we were the first country to set a law to cut emissions by 80% by 2050. We also created a voluntary carbon emissions market before the EU launched its own system. However, we only produce 2% of the world’s emissions, so the changes we make as a stand-alone country only have a small effect on the overall totals.
There’s another thing to consider too. We signed the Paris Agreement on climate change as a member of the EU. The Agreement binds countries to limiting global warming to below 2C. Post-Brexit, we can sign up to meeting the targets or exceeding the targets. Alternatively, we could not sign up at all.
What’s the takeaway point?
The takeaway point here is that Brexit is going to have an impact on energy prices one way or another. The best way to protect yourself against any rises is to shop around to make sure you’re getting the best deal. And if prices go down, by shopping around you get even more of a bargain! So whatever happens to energy prices post-Brexit, use our quick and easy energy comparison tool to save yourself some money.