- Higher carbon market prices led to excess payments: EnergyUK
- Cost uncertainty threatens investment in renewable energy
According to Bloomberg article published on May 15, 2023, British consumers spent as much as £1.1 billion ($1.4 billion) more on electricity and goods last year after losing access to European Union internal energy markets.
That’s according to analysis by trade body EnergyUK, which showed higher carbon prices in the UK’s emissions trading market heaped an extra £700 million on consumers in 2022. Bills were also boosted by as much as £370 million due to post-Brexit trading arrangements, which mean interconnector power is bought and sold less efficiently.
The findings back up years-old warnings that the UK’s energy system would become less liquid, more complex and more expensive after Brexit. British households are currently paying record prices for electricity and gas, even with billions of pounds in government subsidies.
The new arrangements — in place since January 2021 — are a consequence of the UK’s departure from the EU’s Internal Energy Market. The current regime may also hurt the UK’s transition to net-zero because it adds cost uncertainty to the deployment of renewable energy, the report said.
That’s particularly concerning given plans for new multi-purpose interconnectors, which are being developed between the UK and nearby EU countries and connect via offshore wind. The UK plans to more than double its interconnector capacity by 2030 and recently confirmed plans for the LionLink cable with the Netherlands.
