Viewpoint: UK Prime Minister mentions of certainty and policy could ultimately affect Europe’s marine energy industry

In a portion of her statement delivered yesterday to the European Union, United Kingdom Prime Minister Theresa May said, “I hereby notify the European Council in accordance with Article 50 of the Treaty on European Union of the United Kingdom’s intention to withdraw from the European Union.”

May’s statement triggered Article 50, which irrevocably commits the UK’s exit (Brexit) from the EU. As a result, numerous financial and policy-related consequences will emerge.

The EU administrates Horizon 2020, one of many financial instruments implementing initiatives aimed at securing Europe’s global competitiveness.

According to the EU, Horizon 2020 is the largest-ever EU research and innovation program, and it has nearly €80 billion (US$86.1 billion) of funding available over seven years from 2014 to 2020. Millions of dollars from Horizon 2020 fund marine energy development.

Could Brexit effect, via Horizon 2020, investment in research and development, financing new projects or repairing and maintaining existing test sites in Europe’s marine energy industry?

At this point, definitive answers to this question could suffer wide-ranging debate. But, it is fair to say two points in May’s statement, which indicate financial concerns and policy decisions, could directly impact Europe’s marine energy industry.

In her statement under the section titled “Proposed principles for our discussions,” May mentions funding for investment and maintaining existing regulatory frameworks between the UK and EU.

Viewed through the lens of the latest and largest EU investment relating to European marine energy – Horizon 2020 – one could see May prioritizes the continued use of programs to better Europe.

May said the following points in her statement:

iv. We should work together to minimize disruption and give as much certainty as possible.

  • Investors, businesses and citizens in both the UK and across the remaining 27 member states – and those from third countries around the world – want to be able to plan. In order to avoid any cliff-edge as we move from our current relationship to our future partnership, people and businesses in both the UK and the EU would benefit from implementation periods to adjust in a smooth and orderly way to new arrangements. It would help both sides to minimize unnecessary disruption if we agree this principle early in the process.

vi. We should begin technical talks on detailed policy areas as soon as possible, but we should prioritize the biggest challenges

  • Agreeing a high-level approach to the issues arising from our withdrawal will of course be an early priority. But we also propose a bold and ambitious Free Trade Agreement between the United Kingdom and the European Union. This should be of greater scope and ambition than any such agreement before it so that it covers sectors crucial to our linked economies such as financial services and network industries. This will require detailed technical talks, but as the UK is an existing EU member state, both sides have regulatory frameworks and standards that already match. We should therefore prioritize how we manage the evolution of our regulatory frameworks to maintain a fair and open trading environment, and how we resolve disputes. On the scope of the partnership between us – on both economic and security matters – my officials will put forward detailed proposals for deep, broad and dynamic cooperation.

Within the Horizon 2020 framework, no widely publicized credible debate exists negating Horizon 2020 and its continued importance to further research and investment in the European marine energy industry.  And, May made no specific mention of the financial and regulatory framework impact Brexit may have in general on EU programs or specifically on Horizon 2020.

Horizon 2020 funds for EU marine energy

Currently, Horizon 2020 has the political backing of Europe’s leaders and the members of the European Parliament, according to the EU. Member states agreed that research is an investment in the EU’s future and so put it at the heart of the EU’s blueprint for smart, sustainable and inclusive growth and jobs.

Prior to establishing Horizon 2020, the EU studied potential investments across Europe that could “kick-start” ambitious plans for infrastructure development. In 2014 HydroWorld.com reported the EU issued a report that lists about €1.3 trillion (US$1.6 trillion) of potential infrastructure development, including hydropower development.

Since then, Horizon 2020 funding has been dispersed for researching, developing and testing marine energy systems available to companies that are EU-based or established in a country associated to Horizon 2020.

In 2015, Marine renewable energy company Minesto and eight partners received US$5.5 million in financing through the Horizon 2020 research and innovation program to further develop Minesto’s “Deep Green” technology within a project called “PowerKite.” The program aims to produce the next generation of Deep Green units.

According to the European Marine Energy Centre (EMEC), in 2016 the EU awarded just over €3.9 million (US$4.1 million) to support tidal energy testing and demonstration in the waters of Orkney, Scotland, under the Fast Track to Innovation (FTI) scheme.

In February 2016, Dutch tidal energy developer, Tocardo, signed an agreement with EMEC for a 20-year pre-commercial array during which time Tocardo would install eight T2 turbines across two systems at the Fall of Warness.

FTI provides funding for bottom-up proposals for close-to-market innovation activities in any area of technology or application.

In January 2017, UK-based Marine energy developer Atlantis Resources Ltd. was awarded US$24.6 million from Horizon 2020 grant funding to help design, build and operate the second phase of its MeyGen tidal array.

On March 20, Ireland-based companies DesignPro Ltd. and GKinetic Energy Ltd. announced they are using US$3 million from Horizon 2020 to collaborate on developing a new range of run-of-river hydrokinetic turbines.

DesignPro applied for the EU’s Small and Medium-sized Enterprises instrument and secured Horizon 2020 Phase 2 funding to commercialize river turbines up to 100 kW using GKinetic’s technology.

Currently, there is a two-year timetable for Brexit during which time the UK and EU member states must define specific agreements on how they will work together to administer the many instruments under the EU’s purview, including Horizon 2020.

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Gregory B. Poindexter is an associate editor for HydroWorld.com . He also provides social media updates via HydroWorld.com's Facebook , Twitter and LinkedIn accounts.

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