France’s Wind Sector Support Upheld by EU

(CN) - Upholding France's scheme to offset the extra costs of purchasing wind-generated electricity on Thursday, Europe's highest court called it an "intervention through state resources."

French law requires electric companies that produce wind energy to purchase the electricity the turbines generate, usually at a rate higher than market price. Previously, the government offset the difference with money managed by an agency known as the Fund for Deposits and Consignments.

Now, however, lawmakers require electric companies to pass the added costs of wind energy on to the end consumers of electricity throughout France. A French anti-wind energy coalition known as the Angry Wind Association and other groups petitioned France's Council of State to overturn the amended law as illegal state aid.

The French court acknowledged that charging higher rates for wind energy creates an advantage that could affect both trade and competition. It asked the Court of Justice of the European Union, however, whether France's intervention constitutes state aid under EU law.

The Luxembourg-based high court found Thursday that offsetting wind-energy costs by charging end users higher rates is an intervention through state resources.

Whether the scheme qualifies as state aid, however, is a matter for the French court to resolve, according to the ruling.

"It is clear that the offset mechanism at issue in the main proceedings was established by law and must therefore be regarded as attributable to the state," the court wrote.

The court also emphasized how the French energy minister sets the additional charges or nonpayment penalties and deposits said money into the government-held Fund for Deposits and Consignments.

"The court has held that funds financed through compulsory charges imposed by the legislation of the member state, managed and apportioned in accordance with the provisions of that legislation, may be regarded as state resources within the meaning of EU law even if they are managed by entities separate from the public authorities," the court concluded.

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