Our previous two posts reviewed the preliminary report of the Commission’s state aid sector inquiry into electricity capacity mechanisms of 13 April 2016 and discussed when these mechanisms constitute state aid under Article 107(1) TFEU. Once a capacity mechanism constitutes state aid, it can nonetheless be declared compatible with the internal market under the guidelines on State aid for environmental protection and energy 2014-2020 (hereafter the “guidelines”), which contains a specific chapter on generation adequacy measures, or under Article 106(2) TFEU and the Package of 2011/2012 on services of general economic interest. It is interesting to note that the guidelines unfortunately do not address the application of Art 106(2) TFEU.
Written by Leigh Hancher The EU Treaty state aid rules (Articles 107 and 108) have a major role to play in the energy sector. […] read more