EU Opens Probe Into Germany’s Renewable Energy Subsidies

  • Date: 18/12/13
  • Vanessa Mock, The Wall Street Journal

European Union regulators Wednesday launched a probe into Germany’s energy subsidies system, which could see the country’s heavy industry sector having to pay back several billion euros.

The move puts Brussels on a potential collision course with Berlin, after Chancellor Angela Merkel said she would block any changes to the country’s renewable energy law if it meant putting German jobs at risk.

EU regulators say they are looking into the German law’s exemptions scheme, the so-called EEG-Act, which dispenses more than 2,000 heavy energy users, including chemical company BASF and steel producer ThyssenKrupp AG, from paying a green surcharge. The surcharge, which is instead passed on to consumers, was imposed to fund the nation’s exit from nuclear power and fossil fuels in the coming decades in favor of wind, solar and other renewable energy sources.

The European Commission will also investigate the reduction on a surcharge granted when a supplier sources half of his electricity portfolio from domestic renewable electricity, in the so-called “green electricity privilege.”

The move, which had been anticipated, has drawn ire from Berlin. Ms. Merkel said earlier Wednesday: “This is about companies and when it’s about companies it’s about jobs…Of course we will work closely with the Commission, but we will also make clear that Europe won’t be made stronger by jobs in Germany being put at risk.”

The Commission can ask governments to recover aid granted to companies if this is found to have breached EU rules.

The opening of an investigation doesn’t prejudge its outcome.

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