Friday, 7 December 2018

Future regulation of UK-EU energy interconnections remains unsure

Letter sent to The Guardian:
Your energy editor’s report on the new UK-Belgium energy interconnector (“Funding Nemo: £600m power cable now links UK to Belgium,” The Guardian, 6 December;
 overlooks one crucial matter: how will any disputes arising from the joint facility be resolved once the UK has left the EU and the jurisdiction of the European Court of Justice?
This complexity was foreseen in a research paper issued by London-based think tank Chatham House 18 months ago ( “Staying Connected: Key Elements for UK–EU27 Energy Cooperation After Brexit”, 10 May 2017, authored by Antony Froggatt, Senior Research Fellow on Energy, Environment and Resources at CH, (and his  colleagues from CH Europe Programme plus the Energy Policy Group  at University of Exeter).

Their research paper proposed that energy - particularly electricity - should be treated as a special case in the UK’s future relationship with the EU27/

They argue that “strong UK–EU27 energy cooperation could help ensure that existing and future interconnectors – physical pipes and cables that transfer energy across borders – between the UK, Ireland and the continent are used as efficiently as possible.”


They also point out that a report produced for the European Commission in 2013 estimated the EU-wide benefits of “day-ahead” energy  trading at €3–4 billion a year, with benefits to GB in the order of €100 million a year or more in the short term (i.e. up to 2020).

Nearly 10 years ago, EU Energy Package (2009) established the Agency for the Cooperation of Energy Regulators (ACER) as a formal coordination mechanism for member states’ national regulatory authorities in energy.

However, the authors warn: “divergences between UK and EU law are possible in the future – particularly in the absence of a joint enforcement mechanism to ensure the UK’s compliance with Internal energy Market (IEM) legislation.”

They note that a European Commission Staff working paper points out that ‘it is unlikely to be acceptable, for instance, that [national regulatory authorities from] Third Countries wishing to participate in ACER “pick and cho[o]se” which network codes they wish to implement into their national legislation and which not’.

(European Commission (2011), ‘Commission Staff Working Paper on the Possibility of Neighbouring Countries and their Transmission System Operators to Participate in ACER and in the ENTSOs’, SEC(2011) 546 final /2, Brussels, p. 4.

It would have been interesting to know what legal opinion the Attorney General offered the Cabinet and business secretary on such instances.


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