Unfair Competition? EU Takes on German†Green Energy Law

German renewable energy is being subsidized through a charge on energy bills -- but many companies are exempted from the charge. Zoom
DPA

German renewable energy is being subsidized through a charge on energy bills -- but many companies are exempted from the charge.

The European Commission plans to launch a probe this Wednesday into Germany's renewable energy law. Brussels says it†breaches EU competition law because it†exempts many companies from charges levied to fund green subsidies.

The European Commission plans to open proceedings on Wednesday against Germany's renewable energy law on the grounds that it breaches EU competition regulations.

Under the law, German electricity users pay a charge that goes towards funding renewable energy generation. Competition Commissioner Joaquin Almunia believes that exemptions granted to some energy-intensive German companies from those charges run counter to EU law.

The Commission plans to launch proceedings aimed not only at banning such exemptions in the future, but also requiring companies to repay the charges they were exempted from in the past.

Energy Commissioner GŁnther Oettinger even called the entire renewable energy law into question in remarks to a conference hosted by German energy company E.on last week.

Too Many Exemptions?

Oettinger said many provisions in the law appeared to be in breach of EU single market rules and competition law. For example, he said, it wasn't acceptable that Germay subsidizes its own wind power but makes no subsidies available to operators from Denmark and Norway that deliver windpower to Germany.

Some 4,500 companies have so far applied to be exempted from the renewable energy charge. The German Economy Ministry, responding to a written question from the opposition Greens, confirmed that even golf clubs have largely been freed from paying the charge.

On Sunday, Chancellor Angela Merkel said Brussels had raised questions about the law and she reiterated her intention to amend it if she wins a third term in the September 22 election. The law was introduced over a decade ago, before Merkel came into office.

The charges have financed large incentives to renewable energy providers, triggering a boom in green power production. But they have also driven up the cost of electricity for users who have to pay the charge. "We urgently need an amendment to the renewable energy law," Merkel told ARD television.

SPIEGEL/cro

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1. There is no just reason for any new charges
Inglenda2 07/15/2013
The European Commission is itself an expensive organisation for which there is little need. To open proceedings on Wednesday against Germany's renewable energy law, on the grounds that it breaches EU competition regulations, is just another waste of taxpayers money. The law, causing German electricity users pay a charge that goes towards funding renewable energy generation is, as we all know, a farce, but it is the exemptions which Competition Commissioner Joaquin Almunia is protesting against, not the charge itself. Thereby, the German government has never made it at all clear, why free energy is dearer than complicated Gas, coal and Atomic systems. All of these have at times benefited from subsidies and that is the problem. Instead of using taxes for the good of the people, Germany pumps money into inefficient banks, pays the research outlay for industrial companies - which could quite well afford the expenditure themselves - through profits made and spends enormous amounts funding wars and losing lives, in countries which have never been a threat to Europe. What we are seeing here is a form of political argumentation, which deliberately bypasses the truth, by starting with a complaint against exemptions, rather than against a law the funding the, often very profitable energy companies. In such cases of waste, the EU Commission and parliament, are certainly no better than the national governments. All have their own clientele and it merely a question of who gets what, in the struggle for power, privileges and financial backing. Those paying the bill,(the constituents), have little or nothing to say
2. UK has a similar law, which the EU forced them to keep
greanknight 07/16/2013
The UK has a similar law. But in the case of the UK, the law is unpopular and parliament tried to get out of the subsidy arrangement. Needless to say, because the UK wanted out of the green energy subsidy law the EU forced them to stay in it.
3. optional
kielbasinski 07/16/2013
Most of the European regulations are unnecessary.
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