ANNOUNCEMENT 23 Jul 2014

In July 2014, the government of Germany announced a change in production support.

NUMBER OF INTERVENTIONS

1

  • 1 harmful
  • 0 neutral
  • 0 liberalising
Inception date: 01 Aug 2014 | Removal date: open ended

Production subsidy

 On 23 July 2014, the European Commission approved the German renewable energy law EEG 2014. The law expands on the state aid offered in the previous law (cf. Related Measures), by offering more electricity subsidies for energy-intensive industries.
It also includes a new aid framework for producers of renewable energies. According to a press release by the Commission, "producers of renewable electricity will be obliged to sell on the market. They will obtain support in the form of market premiums paid on top of the market price for electricity. Until 31 December 2016 the market premiums will be determined by reference to administratively set reference values. In the case of solar installations on the ground, a pilot tender will be organised. It will determine the level of the premiums and allocation of the aid between participants to the tender. As of 2017, tenders should be generalised but a new law is required to introduce them. The support to renewable electricity is therefore approved until 31 December 2016. Small installations (below 100 kW) will continue to benefit from feed-in tariffs and are not obliged to sell on the market. This part of the scheme was approved for 10 years".
According to the 24th subsidy report by the Finance Ministry (cf. Sources), the subsidies for energy-intensive industries shall encompass 350 million EUR in 2014 alone. The report also mentions that the subsidies are planned to expire on 31 December 2020.
The new law entered into force on 1 August 2014.
In the GTA database the determination of whether a policy instrument discriminates against foreign commercial interests turns on whether it creates or alters the relative treatment of domestic firms versus foreign commercial interests. On this metric, the state aid proposed here is discriminatory because the state aid is not available to competing firms outside of the implementing jurisdiction.
 

AFFECTED SECTORS

 

AFFECTED PRODUCTS