How will Brexit affect the energy market?
Posted on 29th August 2019 at 12:35
With no clear consensus on the Brexit withdrawal deal and multiple potential outcomes, including leaving the EU on 31st October without an agreement, it’s important to take a look at the potential impact this could have on the energy market.
Will Brexit affect my energy bills?
According to a Which? survey published earlier this year, 54% of people think their energy bills will change, or have already, because of Brexit. A further 32% think Brexit will impact energy prices in the future. With all this in mind, let’s take a look at how Brexit will potentially affect the energy market.
What's the biggest challenge?
The biggest challenge facing the UK is the guarantee that energy supplies will remain affordable for businesses as well as domestic customers. If the UK leaves the EU’s single energy market, it will most likely have to pay higher prices, invest in new energy generating capacity, and accept a greater role in the energy sector.
What will a no-deal exit mean for the energy market?
While we can’t say with absolute certainty, it’s likely that a no-deal will soften the pound, causing short-term economic uncertainty. As a result, we can expect the costs associated with gas and power to rise. If there isn’t adequate planning surrounding our exit from the EU’s custom union, power and gas which are delivered via interconnections and continental pipelines could be subject to tariffs. However, the UK is an exporter of these commodities too, so the government could choose to enforce their own tariffs as well.
How will this affect Northern Ireland?
The uncertainty facing the energy market is particularly an issue for Northern Ireland, whose electricity sector is highly integrated with the Republic of Ireland through the Single Electricity Market (SEM). However, the UK and the EU have agreed, in principle, that certain EU laws which govern wholesale electricity markets will continue to apply in Northern Ireland following Brexit, although only time will tell if this is the case.
Ultimately, there's still much uncertainty surrounding Brexit and the energy market, so it will be important to keep an eye on Brexit developments as we edge closer to the 31st of October deadline.
Brexit and the energy market – where to find out more
With the wholesale price of energy continuously fluctuating in a volatile market place, we will help you to avoid paying higher business energy rates by finding a deal that is right for you. Our team of specialists monitor the energy market daily so we can help you to secure your contract with your preferred energy supplier for the length of time that is right for you, explaining the difference in options in clear and easy to understand terms to help make your decision an easier one. We work in partnership with all the major suppliers of energy in the UK to help secure better rates for business energy customers.
Find out more about how we can help you find the right energy deal for your business.
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