Brexit ambiguity worrying UK energy leaders, report finds

Brexit has left the UK’s commitment to future sustainable energy projects uncertain, according to a new report from the World Energy Council think-tank, World Energy Issues Monitor 2017: ‘Exposing the New Energy Realities.

 

The report found that UK’s decision to leave the European Union has created ambiguity surrounding the UK’s future participation in schemes such as the Energy Union project. The report said that the invocation of Article 50 added uncertainty to the energy sector in the UK:  ”The energy sector waits to see if crucial elements, such as continued free trading of electricity and gas, will be secured and what arrangements will be put in place in order to access European staff and specialist equipment and components post Brexit.”

There is further uncertainty concerning continued funding from the European Investment Bank and around regulation such as EU State aid rules, the 15% interconnection target by 2030, the Renewable Energy Directive as well as the EU Industrial Emissions Directive 2010. “The UK has been a significant recipient of EU R&D and investment funding for the energy sector. The UK Government has stated its intention to remain at the forefront of science and innovation post Brexit and the green paper resulting from the Government’s new Business, Energy and Industrial Strategy is the first evidence of this intention being realised,” the report said.

The report also found:

-       Energy sector skills an issue across Europe as the workforce is getting older and there isn’t the necessary level coming through. There are also new challenges, like the digital agenda, that have to be addressed.

-       Digitisation and cyber threats differentiates the UK map from the European and global view, with the UK ranking them as more significant in terms of both impact and uncertainty. This is due to the relatively rapid transformation of the UK energy system to greater levels of low-carbon generation and a growing trend towards flexible demand and local generation.

-       Commodity prices remain a key issue for energy leaders in Europe and globally, especially when trying to plan revenue. “This uncertainty is heightened by emerging concerns surrounding ‘peak demand’ and ‘stranded resources’, concepts,” the report said.

The report said that the Brexit vote had added also uncertainty for the remaining EU countries, as energy leaders in many other European countries cited EU Cohesion as a main concern for the energy sector, due to Brexit and other threats to economic and financial stability of the EU area.

Dr Christoph Frei, secretary general of the council said: “Our survey shows that energy leaders face and acknowledge disruptive change. The Issues Monitor illustrates that innovation issues such as digitalisation, decentralisation, innovative market design or electric storage rapidly gain traction, while a more difficult growth context and new physical and digital risks are posing ever greater threats to the energy sector. Today defining the energy agenda globally, five years ago these issues were far from being a priority.”

The World Energy Issues Monitor surveyed around 1,300 energy leaders and practitioners, including ministers and chief executives, in 95 countries, asking them about what they thought were the current priorities facing global energy leaders.

Related content:

What will the rules of the game be for the energy market after Brexit?

Brexit: Are we any clearer on the implications for the power industry?

Energy Forum on Brexit: little upside opportunity, significant downside risk

Subscribe to New Power for full analysis, comment, interviews and data in our monthly report, and access to our database, or sign up to our FREE e-newsletter for website updates

Not a subscriber? To see if you qualify for our next FREE TRIAL send your name, job title, and telephone number to subscriptions@newpower.info

 

Leave a Reply

Your email address will not be published. Required fields are marked *


*