UK relegated in energy index
11 Nov 2015
A fall in the UK’s energy equity has resulted in the loss of its ‘AAA’ energy score, the annual Energy Trilemma Index reveals.
The fall from ‘AAA’ to ‘AAB’ was caused by a downgrade in the country’s energy equity score, which measures the accessibility and affordability of energy.
Energy equity forms part of the Energy Index’s energy ‘trilemma’ - a system that ranks the energy and climate policies of 130 countries across three measurements: energy security, energy equity and energy sustainability.
If the UK is to remain ahead of the pack, and regain its ‘triple A’ positioning, the government must give more predictability to investors
Trilemma study chairman Joan MacNaughton
According to the Index, the UK’s score has suffered as a direct result of electricity becoming comparatively more expensive.
That is despite the fact the UK maintained a stable position on its energy security score, though the country does continue to face “significant challenges” in securing its future energy supply, the Index suggests.
Executive chairman of the World Energy Trilemma study Joan MacNaughton said: “If the UK is to remain ahead of the pack, and regain its ‘triple A’ positioning, the government must give more predictability to investors in the way the electricity market reforms are progressed.
“More transparency is needed about the future approach to contracts for difference and the levy control framework.”
This year’s Index also reveals two new additions to the negative watch list: the US and South Africa.
The US has been added to list, which includes Germany, Italy, Japan and the UK, because a lack of investment in ageing infrastructure and exposure to extreme weather event – both of which pose threats to the country’s currently strong energy security performance.
South Africa, meanwhile, finds itself on the negative watch list because of its electricity crisis.
Elsewhere, MacNaughton said the report highlights a major issue for the 21st Conference of the Parties (COP), which will tackle climate change concerns in Paris next month.
She said the issue lays in translating the Intended National Determined Contributions (INDC) from international objectives into national level actions for energy.
INDCs are designed so that countries publically outline the climate actions they intend to take post-2020.
“The investment required is huge, and driving it to the right places will require a balanced approach if countries are to meet the three goals of the trilemma,” MacNaughton said.
