1. Security of Ireland's supply of energy could be put at risk - Ireland has invested heavily in energy interconnection with the UK but currently has no gas or electricity interconnector to any other country. Brexit may affect the way in which UK interconnection capacity is utilised and could, at least in theory, put the security of energy supply in Ireland at risk.
  2. Risk of EU and UK energy laws diverging - The EU has been working towards a harmonised energy market which the UK could move away from with the imposition of its own energy regulations post-Brexit. Although we consider any substantial departure by the UK unlikely, it could be particularly problematic in the case of Northern Ireland if different regimes were to apply on the island of Ireland as an all-island electricity market has operated on the island since 2007 and that market is currently being redesigned to further integrate that all-island market into the EU energy markets.
  3. Risk of imposition of tariffs on energy imports - A very significant amount of Ireland's energy products are imported from the UK. A Brexit scenario could result in the imposition by the EU of tariffs and duties on the import of these UK products. However, the risk of this happening appears relatively low as there is already a precedent for tariff-free trade in energy products between EU and non-EU countries.
  4. Risk of the UK favouring national energy companies - Following Brexit, EU State aid rules would not apply to the UK meaning that it could favour domestic businesses through State subsidies or favourable tax rates. This could put Irish energy companies trading in the UK at a competitive disadvantage and could, if measures are not adopted by the EU, give those UK energy companies trading in Ireland an advantage.
  5. Delayed Investment - Investment in energy projects and infrastructure requires a long term investment horizon and the deployment of significant capital. Uncertainty as to the regulatory and commercial evolution of the energy markets in a Brexit scenario would almost certainly delay key milestone and final investment decisions and undoubtedly lead to the cancellation of certain time sensitive projects.