Energy prices will rise by as much as 30 per cent by 2020 driven by a multitude of factors, most of which, but not all, are unconnected to the UK’s decision to leave the EU.

Nick Proctor, managing director of amber energy, explains what some of these influences are and warns business owners not to be fooled by those that may blame Brexit for political gain.

For several years now, the European Commission has been investing heavily in creating a pan-European energy infrastructure, which would allow energy to flow freely across the EU with no technical or regulatory barriers. The idea is that this will facilitate a truly free market keeping prices competitive and allowing the area to fulfil its renewable energy potential.

As things stand, it is unclear whether the UK will opt to stay within Europe’s internal energy market. This will likely form part of negotiations around the terms of an exit. However, given that the project is more about having the right infrastructure in place it is unclear that this would lower energy bills anyway. As a result, it is impossible to say what bearing this would have on energy prices going forward.

Given the uncertainty and the fact this is more an infrastructure project for now, its effect on energy prices has to be regarded as neutral at this stage.

It is tough to forecast how the UK leaving the EU might influence the global economic outlook but the consensus seems to be that there could be a negative reaction and a drop in UK GDP.

Even if this were the case, however, the impact of any economic downturn in the UK would make little difference to the world oil markets.

In other words, the impact would be minimal but would marginally favour a potential decrease in energy prices.

True to its EU commitments, the UK produces around 50 per cent of its electricity from gas now. Despite our historic relationship with coal, just six per cent of our energy production comes from coal now.

The majority this supply (54 per cent) comes from Europe and another 15 per cent from outside Europe. As the value of sterling has plummeted post the Brexit vote, the cost of importing this gas has increased.

Unless the value of the pound recovers, the cost of gas will increase.

The future of the much delayed Hinkley Point C nuclear power station which would construct a 3,200 MWe nuclear power station in Somerset, potentially lowering energy prices long term, has naturally been questions since the Brexit vote.

On balance this is a close call that would probably have to go to penalties. Essentially the chairman at EDF has said Hinkley Point will go ahead despite the EU leave vote. We should indeed expect investors to consider investment in the UK on its own merits; if there is a good deal to be done global firms will likely take them history tells us. However, the project could do without further delays and the uncertainty created by the Brexit vote means it is a tough one to call.

The UK needs Hinkley Point to go ahead and it seems likely but it could be further delayed.

As the fifth largest economy in the world, it is hard to conceive that just because we are no longer in the EU we won’t be capable of arranging competitive deals with non EU countries. However, the argument stands that European countries, whether happy to invest in the UK infrastructure or not, may impose higher energy prices to the UK. It all depends on the outcome of some very complex wider negotiations to come.

It depends on the outcome of a negotiation with too many moving parts to call it.