Industry bosses have warned Jean-Claude Juncker and Theresa May that the all-Ireland Single Electricity Market faces an “existential risk” if tariffs are slapped on energy trading between the UK and the EU following Brexit.

The open letter sent to both the president of the European Commission and the British prime minster, also raises concerns that efforts to combat climate change will be “set back” unless flows of energy via the interconnectors between the EU and the UK are exempt from trading barriers.

The letter’s signatories include Vincent Dufour, EDF Group senior vice president for European Affairs, and Energy UK chief executive Lawrence Slade.

It calls for negotiations on the future relationship, currently taking place between the EU and the UK, to prioritise a “comprehensive” climate and energy chapter.

Key items in this chapter should include agreement on tariff-free trade in energy, efficient interconnector trading arrangements and cooperation on developing markets for shared balancing services.

It says: “Any imposition of tariff or non-tariff barriers to the flows of energy across interconnectors would increase the cost of the low carbon transition and set back action on climate change.

“The aim therefore must be to ensure that trading of energy operates freely across borders on a level playing field that keeps costs down for consumers and ensures decarbonisation and security of supply.

“The Irish Single Electricity Market (SEM), one of the many benefits that resulted from the Good Friday Agreement, would face a possibly existential risk if cross-border electricity tariffs were applied.”

The chapter should also contain an agreement on no tariff or non-tariff barriers for low carbon goods and services such as by ensuring mutual recognition of guarantees of origin for renewable electricity between the EU and the UK.

And it calls for agreement on the UK’s ongoing participation in the EU Emissions Trading System (EU ETS) until at least the end of phase four in 2030 as well as diplomatic cooperation on energy and climate change through the establishment of joint ministerial councils.

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