UK sets out Brexit negotiation position on energy

Efforts to ensure the continued growth of the North Sea’s booming offshore wind industry will be on the agenda as the UK kicks off negotiations with the EU on a future trade agreement, the government has confirmed.

In a new document published yesterday (27 February), the government said it wants a post-Brexit agreement to replace the Internal Energy Market, which it is due to leave when the EU transitional departure arrangements end next January.

The paper, which sets out the government’s proposed approach to negotiations on the future relationship with the EU, says this is one of a number of sector-specific deals that would supplement the wider free trade agreement it wants to secure.

The proposed agreement would cover energy trading over the interconnectors between the UK and the EU, carbon pricing, and climate change.

It says that while existing arrangements would enable trade in electricity and gas to continue over the interconnectors, the UK government wants an energy agreement that will support the continued integration of renewable power and investment in North Sea decarbonisation projects.

Other objectives include facilitating efficient cross-border trading and technical cooperation between network operators and the organisations involved in the planning and use of the energy infrastructure that connect these systems.

The paper also states that the UK would be “open to considering” a link between any future UK Emissions Trading System (ETS) and the EU ETS, like that which is already in place for Switzerland.

This section of the agreement could provide for mutual recognition of emissions allowances that would enable their use in either system, establish processes for exchanging relevant information and ensure that the two trading systems are compatible.

The paper also moots an agreement that would include a mechanism to enable cooperation on the safeguarding of trade in nuclear materials. It states that broader free trade agreements should include reciprocal commitments not to weaken environmental protections.

Responding to the publication of the paper, Energy UK’s interim chief executive Audrey Gallacher said: “In the year that the UK hosts COP26, Energy UK is pleased to see that energy is part of the negotiations on the future trade agreement between the UK and the EU. The Government rightly recognises the importance of the UK energy sector and the need to continue collaboration on energy and climate to tackle climate change and achieve our ambitious decarbonisation targets to reach net zero by 2050.

“Energy UK and its members stand ready to support the government in achieving a deal that will allow the UK to deploy its low carbon infrastructure at the lowest cost to consumers, enabling further decarbonisation and delivering huge benefits for the UK economy, with new green jobs and a continuing role for the UK as a global leader in technology and innovation.”