UK Government is committed to broad cooperation on energy post Brexit but there is real uncertainty as to the form that this cooperation will take

Responding to the publication of the Government's Brexit White Paper as it relates to energy policy post Brexit, Alex Harrison, a partner in the Hogan Lovells Brexit Taskforce said:

"The UK Government is committed to broad cooperation on energy post Brexit, but there continues to be real uncertainty as to the form that this cooperation will take.

"On the one hand, the White Paper contemplates the UK leaving the EU's Internal Energy Market (IEM), but somehow ensuring continued energy trade over our inter-country interconnectors without automatic capacity allocation via the IEM system. On the other hand, the White Paper contemplates the UK continuing to participate in the IEM, using a common rulebook, to preserve existing trade over the interconnectors. In effect, that means that all options for continued cooperation remain on the table and worryingly there is no indication of the UK’s preferred option, how it would work and the extent to which there is EU buy-in to the proposal.

"One thing that is clear is that the UK is absolutely committed to maintaining the Single Electricity Market (SEM) in Ireland given the wider issues around the creation of a hard border on the island of Ireland. The upshot of this is an expectation that power and gas will continue to flow between the UK and the EU27 post Brexit, but it still remains to be seen how this will work and how frictionless these trades will be. Of course, all this assumes that a no deal crash landing can be avoided and that is by no means certain."

For further comment on the impact of Brexit, please visit:  www.hoganlovellsbrexit.com/


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