Conference season lacks energy as Brexit looms

Conference season lacks energy as Brexit looms

Both major UK political parties recently held their 2018 conferences – was it all about Brexit?

The Labour and Conservative events touched on energy and the environment to varying degrees, and revealed key developments for consumer energy bills.

Conservative Party Conference

The biggest energy news to arise from the Conservative Party Conference came when Prime Minister Theresa May announced fuel duty is to be frozen for the ninth year in a row.

A freeze will likely provide relief to drivers and businesses across the UK, amid the rising costs of fuel. In the past twelve months, average petrol prices have risen by almost 12p a litre, and diesel prices up by 14p a litre.

Aside from this announcement, the Conservative Party had no further mention of policy regarding energy or the environment. Instead, the conference was largely focused on Brexit, as the March 2019 deadline looms.

Following this, the Department for Business, Energy & Industrial Strategy (BEIS) has published guidance on trading electricity and gas with the EU if there is no Brexit deal. In the event of a no-deal Brexit, the publications expect no changes to gas trading arrangements, advising interconnector operators to engage with relevant EU national regulators to confirm any requirements for the reassessment of their access rules.

However, when it comes to electricity, European energy law will no longer apply to the UK, leading to the decoupling of the UK electricity markets from the Internal Energy Market. This will require the arrangement of new trading agreements between regulators in the UK and EU to approve new access rules. The government has no plans to change the requirements for access rules within the UK.

This is an important issue, as EU rules will cease to apply in Northern Ireland upon a no-deal Brexit, meaning key elements of the Single Electricity Market (SEM) will be left without any legal basis. The government has said they will take all possible measures to maintain the SEM, stating that they will work with the Irish Government and European Commission to seek an agreement in any scenario, including no deal. They have acknowledged that, if an agreement cannot be reached, there is a risk that the SEM will be unable to continue, separating the Northern Ireland market from that of Ireland.

Labour Party Conference

The Labour Party Conference put an emphasis on the environment, publishing a supplementary report on plans based on their 2017 manifesto to deliver 60% of the UK’s electricity and heating demand from zero carbon or renewable sources by the 2030 deadline.

To accomplish this, the party has targeted areas in wind, solar, and energy efficiency that they would focus on. Labour will continue to support offshore wind and solar energy, aiming to grow offshore wind capacity by 4GW a year to a capacity of 52GW by 2030, and for solar to achieve an annual growth of 2.2GW yearly, to a 2030 installed solar PV capacity of 35GW.

Labour want to look at current policy barriers halting the expansion of onshore wind. The political climate and legislative changes have seen a reduction in support for the technology. The party plans to double the UK’s installed onshore wind capacity by 2030 to 30GW. The report also has a large focus on aims to cut domestic heating demand by around 25% by 2030.

Labour wants a focus on bringing all homes in the UK up to “the highest energy efficiency standards.” The party hopes these plans will create a total of over 400,000 skilled jobs in the energy sector, broken down into 120,000 jobs in offshore wind, 60,000 in onshore wind, 70,000 in solar power and 160,000 in making homes energy efficient.

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James Shaw

Posted by on Monday, the 15. October at 13.17

James Shaw joined the Market Intelligence team at Utilitywise in 2018 as a Graduate Market Intelligence and Policy Analyst. James has a master’s degree in Energy Engineering with Environmental Management from the University of East Anglia.