Brussels, 21/05/2007 (Agence Europe) - The European Commission does not believe that any amendment to the special state aid rules in the coal industry is necessary. This is the main conclusion of a report adopted on Monday following consultation. Adopted at the time of the expiry of the European Coal and Steel Treaty in 2002, special state aid rules constitute an exception to the general prohibition of state aid to the restructuring of the coal industry, which has been unprofitable for a number of years in most member states. They will expire at the end of 2010.The report illustrates important differences in the competitive situation of coal mines in Europe. Whereas mines in Germany, Spain, and Hungary have production costs of more than twice the world market price for coal, and are therefore dependent on operating aid, mines in the Czech Republic, Poland, Great Britain and Slovakia are more or less competitive on the world market. These mines receive either no subsidies at all, or subsidies for new investments and/or mitigating inherited liabilities only. Under the Accession Treaty, Romania and Bulgaria have to inform the Commission of the needs for subsidies to their mines by the end of April 2007. The report describes the changes to state aid policies which have taken place in the member states since the Coal Regulation came into force.
It focuses particularly on types of aid which have been introduced by the member states and the results of the restructuring processes conducted in the coal sector with the use of subsidies. The report also provides an overview of the impact of state aid to the coal industry on the internal market, namely on the production of coal, electricity, coke and steel.
In view of the fact that the global coal market appears to function efficiently, the report concludes that it is not necessary to propose amendments to the Coal Regulation. The Commission has now invited the Parliament, the Council, the Economic and Social Committee, the Committee of the Regions and all stakeholders concerned to provide their input on the report.
Andris Piebalgs declared: “Domestic coal production reduces the energy dependency of the Union and contributes to a diversification of our sources of energy supply”. The European commissioner for energy added: “Coal can be part of a low carbon energy future, provided we develop the necessary low carbon technologies.” (ol)