Brussels, 04/04/2014 (Agence Europe) - In an opinion published on 4 April, the Committee of the Regions (CoR) states that the new rules on state aid for energy and the environment must promote renewable energy and allow the government to grant subsidies for the development of these.
Ahead of the Commission's publication, on 9 April, of new guidelines on state aid for energy and the environment, the CoR is taking position in favour of a flexible support regime which does not compromise the EU's commitment to green energy. The CoR takes the view that the current guidelines lay down ceilings which are too low, limiting the number of companies in the green energies sector eligible to receive state support. As well as increasing these upper limits, the EU should take advantage of the new regime to put an end to subsidies for fossil fuels and nuclear energy, in the opinion of the assembly of local and regional representatives of the EU.
Whilst acknowledging that state aid can create an unfair advantage, the CoR stresses that the new rules should give the member states the flexibility they need to support renewable energy, allowing them to fulfil their climate change obligations. The opinion of the CoR, which was drafted by Gusty Graas (ADLE, Luxembourg), stresses that “competition and the existence of a free market in energy are not ends in themselves”.
“State aid for renewables must contribute to a safer and more secure energy supply, a cleaner environment and a stronger job market. At the same time, it is clear that innovative technologies can only prosper under fair and competitive market conditions. We need to adopt a pragmatic approach that involves the local level and focuses on the sustainable development of both the economy and ecology”, Graas stressed.
The CoR raises the question of the proposal for feed-in tariffs for renewable energies - which would allow producers of green energy to receive a fixed price per kilowatt-hour (KWh) - to be the exception, focusing instead on tradable green certificates. The institution argues that this initiative could compromise trust amongst investors and undermine decarbonisation projects in Europe. The CoR believes that the ceiling for eligibility for subsidies for companies active in the renewable energies sector should be raised from one megawatt to five, and to fifteen megawatts for wind energy; subsidies to fossil fuels should be reduced considerably and subsidies to nuclear energy stopped altogether. In addition, “just as national governments are free to decide on their own energy-mix, local and regional authorities should also be given flexibility to decide how to use the financial assistance for environmentally sound technology projects”, according to the CoR.
Energy poverty - a political priority. Over and above their contribution to sustainable growth and the fight against climate change, the CoR also takes the view that renewables can ultimately help to reduce energy poverty in Europe, which it feels should be a “political priority”. In an opinion by Christian Illedits (PES, Austria), the Committee rejects the idea that investment in renewable energies is counter-productive in the supply of affordable energy. It argues that the social and environmental costs of fossil fuels and nuclear power far exceed all of the other costs of energy, and adequate investment in energy efficiency and renewable energies can help to create jobs and reduce energy poverty.
“Europe's local and regional governments have sent a strong signal that European politics needs to urgently tackle the problem of spiralling energy poverty. The right path to dealing with this worrying issue must be through renewable energy, which requires investment at a regional level. Using EU structural funds, my region [Burgenland, in Austria] has become a true model for this approach: by investing in green energy locally, we are starting to win the battle against energy poverty”, stressed Illedits.
As a starting point, Illedits calls on the EU to agree on an EU-wide definition of energy poverty, which would allow flexibility and take account of the various regional situations and contexts. The definition of this kind should be based around a number of indicators, including a share of 10% or more of net available household income earmarked for energy.
The guidelines on state aid for the environment currently applicable entered into force in 2008. New guidelines on state aid for energy and the environment for the period 2014-2020 are scheduled to be adopted on 9 April. The draft new guidelines envisage, amongst other things, the fact that the member states can grant partial dispensations for high energy-consuming companies from funding the production of renewable energy. (EH)