The UK needs to be in Europe for its clean energy future, sustainability professionals say
UK voters will decide next month whether to leave the European Union, a decision that will have profound impacts for the sustainability agenda in the UK.
The majority view is that leaving Europe would be a backward step for the environment, in part because many environmental issues are cross-border in character or impact and are best tackled co-operatively rather than unilaterally. A survey by the Chartered Institute of Ecology and Environmental Management found that more than 93% of respondents said EU environmental legislation has improved the UK’s natural environment.
On energy and climate change, the environmental consultancy E3G says EU membership also offers substantial benefits that a “leave” vote would require the UK to forego, making the transition to a low carbon economy more expensive and less secure. Being part of the EU energy market is expected to be worth £500m a year to the UK by the early 2020s, it says in a briefing paper.
This is backed up by research from Imperial College London, which shows that connection to EU energy markets allows the UK to buy cheaper energy and is already saving the UK about £90m a year, expected to rise to £160m a year by the early 2020s. In particular, interconnection makes renewables cheaper by allowing greater sharing of electricity balancing services. As the share of renewables increases from almost a quarter of British electricity today, more system-balancing resources will be needed. Sharing those resources with EU neighbours could save the UK £3bn a year in system costs.
Nick Mabey, chief executive of E3G, says: “By accessing the huge EU energy market UK consumers save billions. [By] drawing on energy from other countries when demand is high we can avoid having to build expensive power stations that would stand idle for most of the year. Just as our gas and oil resources are plummeting, leaving Europe would damage our energy security and increase the risk of the lights going out. There would be a price to pay. And it would be paid by every consumer on every energy bill.”
Just the prospect of Brexit has already reduced investor confidence, says Matthew Knight, director of strategy and government affairs at Siemens, one of the biggest wind turbine manufacturers. “We need this kind of debate now like a hole in the head. Investment in energy requires clarity about the future. If there were to be a vote for Brexit, there would be at least a couple of years without clarity while the exit was negotiated.”
Knight says the next five years will be “our last chance to decarbonise the planet”, adding: “Future investment gets harder with Brexit. The UK is in an international competition for investment.”
All energy investment, including low-carbon projects, take around two parliamentary terms – that is 10 years – to develop and build, says Knight. “And they will operate for another four, five, even six parliaments after that. So investors need long-term clarity of direction. Some of the arguments of the leave campaign are exactly the kind of lack-of-detail scenarios that scare investors.”
Driving from within
Iain Conn, CEO of the utility firm Centrica, adds: “It’s very hard to see what we can do to drive competition in Europe if we are outside … The UK needs to be fully inside, driving a competitive Europe, rather than outside, because at that point nobody will listen.”
Brexit would also create a major threat to the progress made at the most recent climate conference in Paris, in part because many of those who want to leave the EU are also climate sceptics, says Lord Deben, chairman of the UK’s Committee on Climate Change.
Deben, a former environment secretary, says. “I note that most climate change deniers are believers in our leaving the European Union, and most of those who want to leave the EU are not prepared to accept the real demands that climate change places upon you.”
Knight adds that if Brexit campaigners were successful, they would be emboldened to tackle areas such as climate change in a way that would harm the UK’s previous leadership in that battle.
The Wildlife Trusts commissioned research from the Institute for European Environmental Policy to set out the facts on what the EU has meant for the environment and wildlife. The report says the environmental achievements of EU countries working together include substantial reductions to air and water pollution; a fall in GHG emissions and rapid recent growth in renewable energy; a significantly improved system of protecting species and habitats; a major increase in recycling rates; and the first steps towards the creation of a more circular economy.
“The research suggests that not everything that comes from Europe has been good for the natural world: agriculture and fisheries policies have been flawed and in some instances counter-productive,” says the Wildlife Trusts. “However, on balance, Britain’s membership of the EU has delivered benefits for our environment … that would be hard to replicate in the event of the UK leaving.”
There are a few prominent environmental figures, however, who are in favour of leaving the EU, including the Conservative MP Zac Goldsmith, who failed in his attempt to become London mayor, and his brother Ben, who runs green investment business Menhaden Capital Management and is chairman of the Conservative Environment Network. Their father, Jimmy Goldsmith, founded the Referendum Party and in so doing created the eurosceptic movement.
Another supporter of Brexit who is passionately in favour of greater clean energy investment is Michael Liebreich, founder and chairman of Bloomberg New Energy Finance. He says: “In and of itself, I do not believe Brexit a major threat to the UK economy – it’s more like the millennium bug than the disintegration of the Soviet Union. Of course there are risks to exiting, but there are also risks to remaining. Whether the UK is in the EU, permanently negotiating a loosening of restrictive regulations, or outside the EU negotiating market access, seems to me to be six of one, half-a-dozen of the other.
Liebreich acknowledges that a vote for Brexit would lead to a period of uncertainty. “Without doubt, it would cause some clean energy investors to hesitate before making final decisions on renewable energy projects in the UK,” he says. “But the impact is likely to be less than feared: frankly there is already a high level of uncertainty due to endless changes to UK energy policy.”
As for fears over issues such as interconnection, he says they will be resolved through negotiations between parties with an interest in a solution. “Interconnecting energy markets in an increasingly variable-renewable world simply makes sense.”
Trade deal fears
There are also figures on the left, so called “Lexits”, who argue that the UK would be able to build a fairer society outside the EU. Commentators such as Guardian columnist Owen Jones point to the Transatlantic Trade Investment Partnership (TTIP) free trade deal being negotiated between the US and EU, saying it threatens a race-to-the-bottom in environmental and other standards. “Even more ominously, it would give large corporations the ability to sue elected governments to try to stop them introducing policies that supposedly hit their profit margins, whatever their democratic mandate,” he says.
The former World Bank chief economist Joseph Stiglitz fanned this sentiment at a Labour Party event in March, saying: “I think that the strictures imposed by TTIP would be sufficiently adverse to the functioning of government that it would make me think over again about whether membership of the EU was a good idea.”
Last month US president Barack Obama warned that it would take up to a decade for the UK to strike a trade deal with the US from outside the EU.
But Gabriel Siles-Brügge, a lecturer in politics at the University of Manchester, says in a recent blog that the UK’s freedom to sign its own trade deals is one of the key objectives of the large number of Conservatives in the out camp.
He adds that any unilateral deal a Conservative government struck post-Brexit would probably be less progressive than the one now being negotiated by the EU. “Leaving the EU is likely to at best expose Britain to much of the agreement’s effect of the regulation of the single market,” he says. “At worst it may lead a Conservative British government [into] signing an even more problematic UK-US agreement.”
Mike Scott Brexit sustainability Environment climate change carbon economy emissions renewable energy economy