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War on Subsidies: Brussels Takes Aim at German Energy Revolution

Frank Dohmen, Christoph Pauly, Gerald Traufetter — Der Spiegel — May 29, 2013

As part of Germany’s switch to renewables, industry has been exempt from paying higher prices associated with solar and wind energy. The European Commission, however, believes the practice distorts competition on the Continent. Huge penalties could be in store.

The audience was small and exclusive, which helps explain why little has emerged thus far of what European Energy Commissioner Günther Oettinger said at the Hotel Stanhope in Brussels on May 6. It was enough to cause something of a stir among his listeners.

For the European Commission and for Competition Commissioner Joaquín Almunia, Oettinger said during a dinner event, it is clear that price concessions for energy-intensive companies in Germany amount to an inadmissible subsidy. In the best-case scenario, he said, the Commission would ban such subsidies. But, he added, the worst case could see Brussels demanding that such companies pay back the money they had saved as a result of the discounts they have received.

Competitors and neighboring countries had filed an official complaint about these benefits with the European Commission, prompting the EU competition authority to launch an investigation. The German commissioner had sought to assure industry representatives that the process was only just beginning and the outcome remained unclear.  Continue reading, here….

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