Changes to rules in the energy sector could have ramifications across the UK economy, according to business lobby group the CBI, so it is extremely important that it remains as close as possible to the EU. That contrasts with specific sectors such as agriculture, shipping and tourism where divergence will be beneficial.

In a new report, Smooth Operations, canvassing opinions across business sectors, the CBI said the main regulatory needs of the energy sector are:

• Barrier-free access and appropriate regulatory convergence with the Internal Energy Market to trade energy effectively
• Bespoke regulatory cooperation to preserve the Integrated-Single Electricity Market in the Republic of Ireland, Northern Ireland and Great Britain
• Influence in key EU agencies and bodies from the UK to allow both sides to manage regulatory alignment, as well as appropriate flexibilities around future rules

In addition, the CBI said the benefits of the UK’s membership of Euratom should be maintained (whether through continued membership or new arrangements), and the UK should ensure full participation with the EU Emissions Trading System until the end of 2020, with at least equivalence thereafter.

Neil Carberry, CBI managing director of infrastructure and people, said: “In a rapidly changing world, a close relationship between the UK and the EU on energy objectives is in the clear interests of both sides. Alignment with EU energy and climate change rules will help achieve secure, an affordable and low-carbon energy supply for customers, as well as help the sector, which supports one in forty-eight jobs across the UK.”

Lawrence Slade, Chief Executive of Energy UK, said: “In order to keep costs down for UK customers and businesses, maintain security of supply and meet our climate targets it will be essential for the future EU-UK agreement to maintain a close trading relationship in energy.

“The Internal Energy Market is a collaborative project with a long-term vision. It has delivered clear benefits to EU and UK customers and is vital in supporting the Single Energy Market on the Island of Ireland.

“This is why Energy UK is leading calls for a comprehensive Energy and Climate chapter as part of the future agreement, advocating close collaboration and alignment.”

The CBI report points out some rules affect the entire economy. It says employment rules, standards, state aid, public procurement and especially data flow must maintain consistency between the UK and EU.

Further reading

UK will remain in EU ETS until 2020, minister confirms

Onshore wind: an industry for a post-Brexit UK?

EUSkills warning: diverging policies may limit skilled staff movement within the UK