However, “It is very probable that the UK would have to replace much if not all of the project and infrastructure finance originating from the EU institutions.”
These are words from UK law firm Simmons and Simmons.
Commenting on UK’s current rollout of smart meters and efforts to lower carbon emissions in line with EU stipulations following the country’s withdrawal from the EU, which has provided almost all if not a majority of the capital, Michael Grubb, professor of international energy and climate change policy at University College London, added: “There are serious doubts about whether the UK will deliver its 2020 target.“
The EU committed £1 billion ($1.3 billion) in funding through the European Investment Bank (EIB) towards the installation of some seven million of smart meters to be installed across the UK.
Apart from the financial assistance the regional board has provided the UK with, the EU has played a major role in setting energy and carbon emission stipulations which the country followed to reach its current levels of developments.
But does the withdrawal mean the UK will develop its own codes on energy infrastructure separate from other EU countries? [Energy trading UK: Where next for code governance?].
Whilst the UK claims that it will manage to fund its energy projects using the money it used to channel into the EU, the country seems to be having backing from other EU firms pledging to invest in the country’s power pool.
This week, we analyse the commitments of the EU in boosting the UK’s electricity market through increasing its energy funding post Brexit in July and how far has the country’s energy sector managed to attract investments from other institutions.
Apart from the withdrawal of the UK from the regional board, EU owned institutions have directed a significant amount towards UK’s power segment.
Last month Northern Ireland based renewable energy firm Larne Energy Storage Limited secured £8.2 million ($10.8 million) funding from the EU’s Connecting Europe Facility to implement a compressed air energy storage project in Larne, reported The News Letter.
[quote] Keith McGrane, head of energy storage at Ireland’s Gaelectric, said: “€8.28 million in additional EU financing is a major boost to the Project and a further validation of the importance and need for the Project, both for Northern Ireland and for wider UK and European energy markets.
“The Project will provide critical generation capacity of 330 MW for periods of up to 6 to 8 hours duration which is enough to meet the electricity needs of over 200,000 homes, and create demand on the system of 250 MW,” added McGrane.
A subsidy of British multinational electricity and gas utility company National Grid also secured a £14.8 million ($19.5 million) energy funding to develop grid interconnection infrastructure between Denmark and the UK.
Indirectly, the EIB seems to have also invested in UK’s power sector by granting Spanish multinational utility firm Iberdrola funding to enhance UK grid infrastructure.
The utility said it plans to use the $223.1 million capital it secured early this month to fund its smart grid, renewable energy and innovation projects in the UK and Spain.
Iberdrola said the loan will also support investment projects on electric mobility and energy storage through to 2018.
Renewable energy funding
Apart from receiving capital from EU institutions, the UK’s energy sector is also witnessing an increase in investments from regional and international institutions and firms.
Recently, Denmark’s Dong Energy announced its plans to invest £6 billion ($7.9 billion) to construct the world’s biggest offshore windfarm in the UK.
The guardian reported that the 1,800MW windfarm comprising 300 turbines off the Yorkshire coast will power more than 1.8 million UK homes with clean and low carbon energy. [UK generates 46% of electricity from renewables].
Swedish energy firm Vatenfall announced its £300 million ($395 million) investment towards the development of 92.4MW windfarm off the coast of Aberdeen in Scotland.
The project will comprise the development of 11 turbines to generate clean energy for provision into the grid.
French water and waste management group Veolia said it is planning to invest £750 million ($989 million) for green energy development in the UK. The firm said its energy funding will create 600 jobs in the UK and is at the moment seeking approval from the government to implement its plans.
The company’s investment plans include initiatives to convert waste material into low-carbon electricity and heat.
Image credit: www.thepointreview.com.