The EU Commission has published draft guidelines for state aid in the field of energy. People could comment on this draft until last Friday, which means I am late with this blog post.
That is a sad state of affairs. On the other hand, the Commission would probably not listen to my comments anyway, so there’s not much harm done.
I am not going to comment on the whole document, but only on the part dealing with renewable energy (points 110 to 137).
For one, the Commission doesn’t even address in any way the most important question. Which is why exactly they get to order Member States around on how to build their feed-in tariff systems.
The basic principle in EU law is that the EU has only as much competences as the Member States have surrendered to the EU. The German government has made it quite clear that the EU Commission should mind its own business and stop meddling in German feed-in tariff policy.
As well they should. Nobody elected Commissioner Almunia in the latest German election. His democratic mandate for deciding about German renewable energy policy doesn’t exist.
I recall that the European Court of Justice has repeatedly decided about these issues. As far as the German feed-in tariff system is concerned, the Commission lost with its attempt at a power grab (Preussenelektra). They won in the latest French case (more here), but the French system is completely different from the German one.
It would be interesting to hear what the Commission thinks about the latest European Court of Justice case. But I couldn’t find any reference to it.
That would be interesting because the Commission’s proposals suck big time. So German politicians need to figure out what exactly they have to do to keep the Commission from meddling in German politics.
On the other hand, the Commission is a party to this dispute over an attempted power grab, so even if they said something about the matter in their Guidelines, it would probably be as worthless as their ideas about how a feed-in tariff should look.
That said, let’s have a look at what the Commission wants Germany to do.
The main point is the stupid dumb harmful idea in point 120 (a) requiring the feed-in tariff to be based on “a competitive bidding process”.
The result of that would of course be to grant the feed-in tariff only to whatever technology happens to be the cheapest at the particular point in time of the bidding process.
It would have meant that solar energy would never had a chance to take off if that harmful idea had been in place in the original German feed-in tariff legislation.
It will mean that Germany can’t build offshore wind, since that technology is much more expensive than onshore wind.
Again: Any decision of the EU Commission affecting the right of Germany to choose its energy sources is not compatible with Article 194. I blogged about that before.
After that blog post, the German Federal Constitutional Court recently published a decision where a majority ruled for the first time that an act of an EU institution is ultra vires. That’s Latin, and it means “exceeding competence”.
This attempted power grab of the EU Commission would be an excellent candidate for the next such decision by the German Federal Constitutional Court.
So, in short, the proposals in these “Guidelines” should be firmly rejected. And just as a matter of law, Germany is in no way obliged to follow these Guidelines, since the German feed-in tariff system is not state aid in the first place.