From oil prices and economic growth rates to the value of the British pound, a host of indicators turned more volatile on June 24 as a small majority of Britain’s citizens voted in a nationwide referendum to leave the European Union.
But one of the most confounding questions to come out of the vote could be on the front of climate change.
Specifically, the questions are how Britain and continental Europe will separate their climate and energy policies – and whether those policies will stay on track toward carbon-reduction goals agreed half a year ago, as countries of the European Union banded together to negotiate a major international climate treaty.
It’s now unclear whether Britain will ratify the historic Paris climate treaty at the same time as the rest of the union’s members. The impact of “Brexit,” the British vote to exit the EU, is also potentially destabilizing on Europe’s Energy Union.
What’s clearest, experts say, is that major decisions will be stalled as bureaucrats and politicians on both sides of the English Channel determine what comes next.
“EU ratification of the Paris Climate treaty may be delayed by Brexit,” says Maria Castellina, senior media officer at the environmental non-profit Friends of the Earth-UK. “With the UK leaving the EU, our contribution to meeting the targets will no longer be included, and how that effort will be shared out amongst the other countries will take time to work out.”
In just a few weeks, the European Commission was expected to present its plan for how all 28-member states would work together to reduce greenhouse gas emissions to 40 percent below 1990 levels by 2030. Now the presentation will probably be put on hold while it’s determined whether Britain will continue to work toward that common target.
Moreover, huge questions hang in the air regarding Britain’s participation in the European carbon emissions trading scheme, and whether the country will continue to work toward the EU goal to provide 20 percent of its power from renewable energy sources by 2020.
The outcome of these decisions could weaken the climate commitments of both Britain and EU, some advocates of emissions cuts say.
“The UK is already off track in terms of meeting the EU’s renewable energy targets. Leaving the EU may mean we no longer have to comply with the renewables directive, so Brexit could badly stall any possibility of getting the stronger policies we need,” says Ms Castellina.
Previously one of the most vocal EU member states calling for cuts to carbon emissions, Britain will no longer be in a position to pressure the rest of Europe to meet targets to keep global warming at 1.5 C below pre-industrial levels, she adds.
A reset in London
A key reason: In response to the Brexit campaign’s success, British Prime Minister David Cameron announced his intention to resign from office, casting doubt on the future of the current government’s domestic energy policies, too. Cameron had pledged to phase out coal-run power plants by 2025. But will that happen under the new government?
Amber Rudd, Secretary for Energy and Climate Change since the Conservative Party’s parliamentary victory in 2015, was a fervent supporter of Britain remaining in the EU and of Britain’s participation in the Paris climate treaty. But Ms. Rudd will almost certainly follow Cameron when he leaves office. It’s unclear who will be take her place, or whether a climate change portfolio will exist in the next government, experts say.
Many of the main faces of the Brexit campaign, including Boris Johnson, London’s grandiloquent former mayor, are known climate change skeptics. On Thursday Justice Secretary Michael Gove, a leading architect of the Brexit, announced his plans to campaign for the premiership. Just three years ago, during his time as education secretary, Mr. Gove also campaigned to remove climate change from school curriculum. Other “Brexiters” have called to completely abolish the country’s landmark Climate Change Act.
Meanwhile, the EU was instrumental in pushing forward numerous environmental protection laws in Britain, including laws that put limits on pollution from power plants, established rules for cleaning up beaches, and set regulations for recycling and waste management. Limits on overfishing and the use of harmful pesticides will also need to be rewired once Britain is outside the EU.
Given the narrowness of the Brexit vote and an outpouring of public anxiety over the decision in the past week, it’s not clear what form Britain’s next government will take. What’s clear in any case is the uncertainty that now reigns.
“With over 70 percent of our environmental laws coming from Europe, it’s vital that UK rules are put in place to protect our wildlife and nature,” Sam Lowe, a campaigner at Friends of the Earth-UK, said in a statement.
Some experts say they are unconvinced Britain’s politicians would have implemented these laws without EU pressure, or that they will do so again on their own.
Nigel Farage, leader of the UK Independence Party (UKIP), and perhaps the most visible proponent of a Brexit, does not support limits on pollution from power stations. He’s also called for the country’s Department of Energy and Climate Change to be completely scrapped.
What’s more, some observers say the Brexit could spark a hydraulic fracturing boom. Hydraulic fracturing, or fracking, a form of natural gas extraction widely criticized by environmentalists, is currently regulated by the European Union. Brexit could give the industry carte blanche to develop, experts say, at least until the country puts its own regulations on the books.
The UK’s auto industry will also be impacted by the break with Brussels. Currently, EU safety standards and environmental rules allow manufacturers based in Britain to sell their vehicles anywhere in the EU’s common market. Now, however, a whole new set of regulations will have to be hammered out. This will likely make international trade and business more cumbersome, and could negatively impact the environmental protection rules the industry is currently forced to follow.
And perhaps most important for consumers, the Brexit could cause energy prices in Britain to rise and investment in clean energy to fall, experts say
“There is more market uncertainty because people don’t know what the regulatory environment is or what the investment climate will be,” says Tom Cunningham, Deputy Director of the Atlantic Council’s Global Energy Center.
“If the UK is not part of a broader energy market then it will not benefit from being fully integrated into a larger body of energy consumers,” he adds. “And the bigger the market the more competitive it can be, the lower the prices.”
No instant breakup
Still, even if the Britain begins the process to exit the EU immediately, it will take several years for the country to extricate itself completely. In order for the process to begin, the British government must trigger article 50 of the Lisbon Treaty, the constitutional basis of the EU. Officials on both sides of the Brexit debate say it’s likely that won’t happen until October when Cameron is expected to step down.
Meanwhile, EU officials are adamant that no negotiations will take place until article 50 is triggered, meaning the status quo will persist for now. Climate advocates say they’re hopeful the Paris climate treaty will be ratified before Britain makes its official exit.
“In general until the UK has notified and concluded its negotiations on its relationship with the EU, the UK remains a member of the EU and will in principle have to comply with its entire aquis [obligations] like the other 27 member states,” says Philippa Jones, communications manager at the European Environmental Bureau, adding that it is too early to judge how a Brexit will impact the EU’s climate ambitions.
In the wake of the referendum, influential companies like Shell and British Petroleum said they will continue working in Britain for the time being. Plans for the Hinkley C power plant, a new nuclear reactor in Somerset, will also go forward.
Speaking at a conference on business and climate change on Wednesday, Secretary Rudd said the French energy company building the Hinkley power plant was “absolutely committed” to making a final investment decision.
“We are still full tilt on Hinkley Point,” she added.
And despite the hype, Mr. Cunningham says the biggest energy infrastructure projects are unlikely to be impacted by the Brexit
“[Those] Energy investments are a 20 or 30 year project or longer,” he says. “So I think they’ll be a little more resilient to the uncertainty.”