EU-UK relations: Council greenlights talks on electricity and cohesion deals, as well as UK’s participation in Erasmus+ for 2027
Today, the Council formally authorised the Commission to open negotiations with the UK on two agreements regarding the latter’s participation in the EU’s internal electricity market and on an appropriate UK financial contribution to the EU’s cohesion policy. The Council also agreed to allow UK’s participation in the EU’s Erasmus+ programme for the year 2027.
Strengthening the Union’s relations with the United Kingdom is a key priority of the Cyprus presidency. Today’s decisions mark tangible progress in delivering on the outcomes of the first EU–UK Summit held in May last year, where we opened a new chapter in our partnership. By promoting learning mobility via Erasmus+, we are advancing shared interests and reinforcing people-to-people ties, especially for our youth. At the same time, by deepening cooperation in electricity, we are enhancing energy security and creating new opportunities for businesses. These decisions undoubtedly mark a significant step in forging a strong, mutually beneficial, and forward-looking EU-UK partnership.
Marilena Raouna, Deputy Minister for European affairs of the Republic of Cyprus
The aim of the electricity agreement is to allow the UK’s participation in the EU’s internal electricity market by aligning respective rules, thus significantly contributing to energy security for both parties, especially amid the current geopolitical turmoil.
The agreement on the UK’s financial contribution towards reducing disparities between the EU regions by increasing the bloc’s economic, social and territorial cohesion is part of a consistent EU policy that couples the granting of market access to a third country with a fair financial contribution reflecting the benefits derived from such access.
Electricity agreement
The electricity agreement would allow the UK’s participation in the EU’s internal electricity market, both the wholesale and retail market, and envisages dynamic alignment of UK laws to EU rules, to create a level playing field between the parties.
Allowing the UK to participate in the EU’s internal electricity market would improve the efficiency of the electricity trading between the parties, and facilitate investments in electricity infrastructure, including renewable electricity generation that is necessary to achieve both sides’ net zero ambitions while safeguarding the level playing field between the EU and the UK.
Agreement on the UK’s financial contribution to cohesion
The agreement would establish a permanent mechanism for an appropriate financial contribution of the UK towards reducing economic, social and territorial disparities between the regions of the EU, applicable to the electricity agreement and any further agreement affording the UK access to the Union’s internal market. The financial contribution of the UK should appropriately reflect the relative size of the UK’s economy and the proportion of the internal market in which the UK aims to participate in line with consistent EU policy.
It is important for the EU that both agreements should follow parallel paths and enter into force and apply simultaneously.
Participation in Erasmus+
The Council decision will allow the UK’s association to the EU’s Erasmus+ programme on education, training, youth and sport for the year 2027. The decision sets out the specific terms and conditions, including financial ones, of the UK’s participation.
A review is foreseen after ten months from the start of the UK’s participation, to inform future decision making as regards the possible UK participation going forward, without prejudging the necessary legislative procedures, including as regards the next Multiannual Financial Framework (MFF) 2028-2034.
Next steps
Following today’s adoption, the Commission is authorised to open negotiations with the UK on the two agreements in question. Once negotiations are finalised, the agreements will have to be endorsed by the Council before they can enter into force.
For UK’s participation in the Erasmus+ programme, the EU-UK Specialised Committee on Union Programmes is now expected to adopt the relevant joint decision shortly, thus enabling the UK’s participation in the programme on 1 January 2027.
Background
On 19 May 2025, the EU-UK summit adopted a joint Statement, reaffirming the commitment to the full, timely and faithful implementation of the Withdrawal Agreement, including the Windsor Framework, and the Trade and Cooperation Agreement (TCA). They welcomed a renewed agenda for EU-UK cooperation – Common Understanding, which committed the Commission and the UK to explore in detail the necessary parameters for the UK’s possible participation in the EU’s internal electricity market.
The EU’s Erasmus+ programme for education, training, youth and sport was established in May 2021. Following the EU-UK summit of 19 May 2025, the Commission and the UK reached a Common Understanding to work towards the association of the United Kingdom to the Erasmus+ programme.
