Interconnectors, the EU Internal Electricity Market and Brexit
Type: Discussion papers
Publication date: April 2017
Author: Jonathan Bosch
This discussion paper outlines why and how the UK should encourage continued investment in electricity interconnectors between the UK and EU following Brexit.
- UK policymakers should provide a clear long-term energy strategy and commit to interconnector mechanisms currently in place.
- To this end, the UK should pursue barrier-free access to the IEM and preserve the benefits of harmonisation with the European energy market, including an ongoing implementation of EU energy packages, network codes and market design. Industry stakeholders favour this approach15.
- Supply security, flexibility, price competition, renewables integration and decarbonisation will all benefit from the continued free trade of energy in the IEM16.
- The UK has to ensure that Ofgem and the National Grid remain contributing members of the Agency for the Cooperation of Energy Regulators (ACER) and ENTSO-E, respectively. Otherwise the UK risks losing its role as a rulemaker and becoming a rule-follower.
- UK policymakers will need to consider replacing the comprehensive financing options currently available at the EU level (EEPR, PCIs, European Investment Bank loans, etc.) if it is doubtful that they will still be available after Brexit.
Grantham Institute discussion papers use evidence to present thought-provoking reflections on topical issues. Our students work with our academics to form these opinion pieces.