On Thursday 26 September, the Bruegel think tank published an analysis of energy and climate cooperation between the European Union and the United Kingdom.
This relationship is based on the 2021 Trade and Cooperation Agreement, which also covers trade in electricity and natural gas, and which Bruegel points out is temporary in nature. Despite the mutual benefits of working together in these areas, the political brakes, stemming from Brexit, are preventing the development of closer relations.
On the energy front, the pro-European think tank demonstrates the importance of trade between the EU and the UK (10% of trade flows in 2023) for the security of supply of both parties.
And with good reason: as a major supplier, the UK played a leading role in the 2022-2023 energy crisis. According to Bruegel, the renewable energy potential of the North Sea could meet 45% of the electricity needs of the neighbouring countries by 2050.
However, the UK’s reluctance to rejoin certain EU regulatory processes is slowing progress.
The introduction of separate Carbon Border Adjustment Mechanisms (CBAMs) for the two regions could also complicate trading.
On the climate front, while Bruegel notes that the UK and the EU share similar ambitions, once again regulatory disagreements remain.
The study recommends three areas: finalising the temporary agreements on electricity trade, mitigating the trade disruption caused by carbon tariffs at borders, and transforming their shared climate ambitions into concrete action on the international stage.
Analysis: https://aeur.eu/f/dmm (Original version in French by Nithya Paquiry)