Brexit-No good for UK’s clean energy plans

Environment and sustainability professionals recognise that European membership provides the UK with both environmental and business benefits.
Published: Fri 13 May 2016

Next month, the UK will hold a referendum to decide whether it will remain in the European Union. While the issue is one of complexity, we want to explore what Brexit will mean for the country’s renewable energy and climate plans.

There are some pressing practical issues that should be considered. For instance, access to EU funding and special subsidies for climate-related projects.

Reduced access to funding

The European Investment Bank (EIB) has invested €7.2 billion (£5.59 billion) into renewable energy since 2007. According to Bloomberg, the UK has been the biggest beneficiary, receiving 24% of these funds, a great deal more than any other country.

Should the UK leave the EU, there is a possibility that the country would lose out on funding from EIB for climate-related projects. Non-EU countries have received only 12% of the funds that have been disbursed so far, so it is possible that the UK could lose out on billions of pounds for climate and renewable projects.

The UK could also lose access to the EU’s eighth Framework Programme which funds innovation and research, Horizon 2020, which runs until 2020 and has a total budget of €70 billion. A significant portion of these funds are dedicated to energy innovation and again, the UK is one of the larger recipients. Brexit may see funding for academic institutions and companies that currently benefit from the programme disappear. This will have a significant backlash on research and development of new clean energy technologies.

Energy policy-less “clout”

EU members enjoy certain privileges and higher priority in access to funding over non-members, and they wield significantly more “power” when it comes to making changes on the EIB policy.

Brexit could reduce the UK’s influence on international policy agreements and regulations. UK’s participation in certain international agreements and organisations such as the European Union’s Emissions Trading System (ETS) will be affected negatively-its ability to influence policy would be greatly diminished and it would likely be subject to the decisions of the other EU-member states as it would no longer have voting power in the EU parliament.

Earlier this year, Baroness Young, former chief executive of the Environment Agency  said of Brexit: ‘Environmental quality, clean air, healthy oceans and rich natural resources can only be secured by collaboration across national boundaries and common EU standards promote new technologies and businesses. Brexit would halt and even reverse four decades of progress.’ She added: “We would no longer be able to shape EU policy and our influence on the environmental performance of other member states would decline very sharply once we were no longer at the negotiating table.”

What the UK’s environment and sustainability professionals say

A survey, carried out by The Institute of Environmental Management & Assessment (IEMA)- an association made up of  over 15,000 environment and sustainability professionals from around the world-highlights the fact that Brexit may be bad for energy-related business.

The UK-based professionals responded to the first of IEMA’s online polls to test views on different aspects of UK/EU environmental policy. The “by invitation-only” online survey - which could only be completed once by each respondent - gained 1,570 responses.

The majority of respondents (78%) said they believe that the UK is influential in the development of EU environment and climate policy and that being part of the EU gives the UK more international clout, with the ability to exert greater international influence on environmental outcomes by working within the EU block of 28 countries (82%).

82% of IEMA members agree that operating within the EU provides a policy landscape that is more stable and therefore potentially more effective for both businesses and the environment over the medium to longer term.  

IEMA’s Chief Policy Advisor Martin Baxter said: “Environment and sustainability professionals frequently cite policy certainty as being a key enabler of investment for long term improvement programmes.  Whichever way the vote goes, it is crucial to maintain long-term policy stability and continuity in the areas of environment and climate change”.

Overall, 70% of respondents feel that Brexit would have a negative effect on their organisation. In terms of the impact on the environment and sustainability profession overall: 74% believe it would have a detrimental effect.

When it comes to curbing carbon emissions and attaining long-term climate change targets, 57% believe the UK is more likely to achieve long term carbon emissions if it is part of the EU. Only 14% believe that the UK can achieve them independently.

Long term view should be considered

Professor Sir John Lawton, previously chair of the Royal Commission on Environmental Pollution and a former chief executive of the Natural Environment Research Council, had this to say about Brexit: ‘UK politics has a tendency to be short term and see the natural environment as an impediment to economic growth, and EU agreements help mitigate this by encouraging us to be more long term in our public policy.’

It seems as if Brexit will have a number of negative consequences for the UK energy sector. If the UK does leave the EU, it would need to have a number of long-term plans in place to avoid any negative impacts on a market which not only provides jobs, but also energy security.  

Further reading

Bloomberg- Brexit May Lose U.K. Billions in Funding for Climate, Renewables