UK Renewables Projects In Doubt Over EU State Aid Rules

  • Date: 12/02/14
  • Guy Chazan, Alex Barker and Pilita Clark, Financial Times

Some of Britain’s flagship renewable energy projects have been thrown into doubt over EU concerns that the subsidies that support them might be a waste of taxpayer money.

To the alarm of some of the UK’s biggest energy companies, ministers are struggling to deliver schemes to foster investment in low-carbon power generation after underestimating EU rules against anti-competitive state subsidies.

Hitches in securing European Commission state aid approval threaten to delay the rollout of the first batch of “contracts for difference”, or CFDs, a form of subsidy providing long-term, stable prices for renewable and nuclear projects. It is the centrepiece of the coalition’s energy bill, passed late last year.

According to people involved in the informal talks, concern in Brussels has focused on an early form of CFD that the government wants to award to nine projects in April. These interim arrangements were created to ensure the nine ventures can go ahead quickly without having to wait for the official CFD rollout later in the year.

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