OPINION OF ADVOCATE GENERAL

CAMPOS SÁNCHEZ-BORDONA

delivered on 14 April 2016 ( 1 )

Case C‑574/14

PGE Górnictwo i Energetyka Konwencjonalna S.A.

v

Prezes Urzędu Regulacji Energetyki(Request for a preliminary ruling from the

Sąd Najwyższy (Supreme Court, Poland))

‛Internal market in electricity — State aid — Commission Decision finding State aid to be compatible with the common market — Article 107 TFEU — Article 4(3) TEU — Decision 2009/287/EC — Stranded Costs Methodology — Calculation of the annual adjustment of compensation for stranded costs — Situation of the relevant market — Powers of the national authorities and courts’

1. Directive 96/92/EC ( 2 ) concerning common rules for the internal market in electricity laid down the principle of and legal bases for the opening-up to competition of the electricity sector of the Member States. The gradual transition to those new arrangements was accompanied, in some of the Member States, by State aid granted to their electricity undertakings.

2. In that connection, the Commission adopted in 2001 a methodology for analysing whether the relevant State aid was compatible with the internal market. In particular, the Commission laid down the method which would be applicable to the calculation of so-called stranded costs, that is the costs — which could be offset by State aid — incurred as a result of the fact that it was economically unviable for undertakings in the sector to honour, in the new open-competition model, their prior commitments or guarantees regarding the supply of electricity.

3. Subsequently, in accordance with that methodology, the Commission was required to give a determination on a number of State systems for providing assistance to undertakings in the electricity sector. One of those was the system set up by the Republic of Poland, with which the present reference for a preliminary ruling is concerned.

4. In 2007 the Republic of Poland adopted a law on compensation payable to electricity generating companies for the stranded costs which they might incur. ( 3 ) In particular, the Polish authorities laid down in that law the conditions for defraying the costs incurred by power generators as a result of the early termination of long-term contracts concluded for the purchase of electricity. The Commission decided that that State aid was compatible with the common market in its Decision 2009/287/EC. ( 4 )

5. The dispute which has arisen is confined, in short, to determining whether payment of the State aid authorised by the Commission must be effected according to the ‘original’ situation of the beneficiary electricity undertakings (and their generation units), as reflected in the 2007 Law, or according to the situation obtaining at the time of implementation of the aid (in the instant case, the 2009 financial year).

6. The reference for a preliminary ruling will enable the Court, first, to confirm its case-law on the exclusive competence of the Commission to determine whether State aid is compatible with the common market. Second, it will be necessary to establish which of the two interpretations advocated by the parties to the proceedings (which they call ‘static and dynamic interpretations’) is to prevail for the purposes of the application of Decision 2009/287.

I – Legislative framework

A – EU law

1. Commission Communication relating to the methodology for analysing State aid linked to stranded costs ( 5 )

7. On 26 July 2001 the Commission adopted a communication relating to the methodology for analysing State aid linked to stranded costs (‘the Stranded Costs Methodology’).

8. Pursuant to Section 2, sixth paragraph, of the Stranded Costs Methodology, its purpose ‘is to show how the Commission intends to apply the Treaty rules on State aid in the case of aid measures designed to compensate for the cost of commitments or guarantees that it might no longer be possible to honour on account of [the opening-up to competition of the European electricity sector provided for in] Directive 96/92/EC’.

9. Section 3 of the Stranded Costs Methodology defines the commitments or guarantees of operation which qualify as stranded costs, and point 3.3 provides: ‘Such commitments or guarantees of operation must run the risk of not being honoured on account of the provisions of Directive 96/92/EC. In order to qualify as stranded costs, commitments or guarantees must consequently become non-economical on account of the effects of the Directive and must significantly affect the competitiveness of the undertaking concerned. Among other things, this must result in that undertaking’s making accounting entries (e.g. provisions) designed to reflect the foreseeable impact of the commitment or guarantee. Especially where, as a result of the commitments or guarantees in question, the viability of the undertakings might be jeopardised in the absence of aid or any transitional measures, the commitments or guarantees are deemed to meet the requirements laid down in the preceding paragraph. The effect of such commitments or guarantees on the competitiveness or viability of the undertakings concerned will be assessed at the consolidated level. For commitments or guarantees to constitute stranded costs, it must be possible to establish a cause-and-effect relationship between the entry into force of Directive 96/92/EC and the difficulty that the undertakings concerned have in honouring or securing compliance with such commitments or guarantees. In order to establish such cause-and-effect relationship, the Commission will take into account any fall in electricity prices or market share losses suffered by the undertakings concerned. Commitments or guarantees that could not have been honoured irrespective of the entry into force of the Directive do not constitute stranded costs.’

10. Section 4 of the Stranded Costs Methodology refers to the calculation of permitted State aid, and point 4.2 states: ‘The arrangements for paying the aid must allow account to be taken of future developments in competition. Such developments may be gauged in particular by way of quantifiable factors (prices, market shares, other relevant factors indicated by the Member State). Since changes in the conditions of competition have a direct effect on the level of eligible stranded costs, the amount of the aid paid will necessarily be conditional on the development of genuine competition, and the calculation of aid paid over time will have to take account of changes in the relevant factors in order to gauge the degree of competition achieved.’

11. Pursuant to point 4.5 of Section 4 of the Stranded Costs Methodology: ‘The maximum amount of aid that can be paid to an undertaking to offset stranded costs must be specified in advance. It must take account of productivity gains that may be achieved by the undertaking. Similarly, the detailed arrangements for calculating and financing aid designed to offset stranded costs and the maximum period for which such aid can be granted must be clearly spelt out in advance. Notification of the aid will specify in particular how calculation of the stranded costs will take account of changes in the various factors mentioned in point 4.2.’

2. Decision 2009/287

12. Article 1 of Decision 2009/287 states: ‘1. The Power Purchase Agreements between Polskie Sieci Elektroenergetyczne S.A. [the publicly owned operator of the Polish electricity network] and the companies indicated in Annex 1 to the Act on the rules governing the covering of costs incurred by enterprises in connection with the early termination of Power Purchase Agreements constitutes state aid within the meaning of Article 87(1) of the EC Treaty to electricity generators. 2. The state aid referred to in Article 1(1) was awarded unlawfully and is incompatible with the common market.’

13. According to Article 4 of the same decision: ‘1. The compensation provided for in the [Law on cost coverage] constitutes state aid within the meaning of Article 87(1) of the EC Treaty to the electricity generators listed in Appendix 2 to [the Law on cost coverage]. 2. The state aid referred to in Article 4(1) is compatible with the common market on the basis of the Stranded Costs Methodology. 3. The maximum amount of compensation provided for in the [Law on cost coverage] shall be the amount following deduction of the total revenue generated by the assets under the PPAs and which is available to cover investment costs.’

B –National law

14. In accordance with Article 2(7) of the Law on cost coverage, ‘power generator’ means ‘an energy undertaking carrying on an economic activity in the field of electricity generation which is party to a long-term contract, with the exception of Polskie Sieci Elektroenergetyczne S.A., established in Warsaw’.

15. Article 2(12) of the Law on cost coverage defines ‘stranded costs’ as ‘the costs of a power generator which are not covered by income from sales of electricity generated, reserve capacity and system services on the competitive market following the early termination of a long-term contract, which relate to the generation of electricity and which the power generator incurred up to 1 May 2004’.

16. Pursuant to Article 32(1) of the Law on cost coverage, ‘[i]f a power generator which has concluded a termination agreement forms part of a group, the calculation of stranded costs shall take into account the amounts, indicated by the letters “N”, “SD”, “R” and “P”, referred to in Article 27(1) in relation to each power generator and each undertaking forming part of the group and carrying on an economic activity in the field of electricity generation on Polish territory at the generation units mentioned in Annex 7 to the Law [on cost coverage]’.

17. Annex I to the Law on cost coverage includes a list of power generators which have concluded long-term contracts for the acquisition of electricity, referring to the generation units concerned.

18. Annex 2 to the Law on cost coverage lays down the maximum amounts of compensation for stranded costs payable to the power generators benefitting from State aid, as at 1 January 2007.

19. Annex 7 to the Law on cost coverage contains a list of the generation plants that are taken into consideration for the calculation of the stranded costs of power generators, and that are take into account in the adjustments of those costs.

II – Facts

20. As is clear from the order for reference and the observations of the parties, PGE Górnictwo i Energetyka Konwencjonalna S.A. (‘PGE’) is a power generator which, as the successor to PGE Zespól Elektrowni Dolna Odra, took over the latter’s legal position.

21. For its part, PGE Zespół Electrowni Dolna Odra concluded with Polskie Sieci Elektroenergetyczne S.A., before 2007, certain long-term contracts for the purchase of electricity, in which it undertook, in return, to make certain investments.

22. Pursuant to those contracts, PGE Zespół Elektrowni Dolna Odra (subsequently PGE Górnictwo i Energetyka Konwencjonalna S.A.) undertook to create new generating capacity, to modernise equipment and to supply Polskie Sieci Elektroenergetyczne S.A. with a fixed minimum quantity of electricity. The latter company (the publicly owned network operator), for its part, undertook to purchase at least the agreed minimum quantity of electricity at a price based on the principle of passing costs on to the consumer.

23. In 2007, after the accession of the Republic of Poland to the European Union and while Directive 96/92 was in force, the Law on cost coverage was adopted, providing for a right of compensation for stranded costs. At the time of adoption of that Law, PGE was part of a group of companies which also included, in addition to other power generators, PGE Elektrownia Bełchatów S.A. (previously called Elektrownia Belchatów S.A.; ‘ELB’).

24. However, PGE and ELB did not form part of the same group of companies when the former took over the long-term contracts for the purchase of electricity. As I stated above, both companies belonged to the same group of companies on the date of adoption of the Law on cost coverage (29 June 2007) and on the date of adoption of Decision 2009/287 (25 September 2009).

25. Neither the annexes to the Law on cost coverage nor the annexes to Decision 2009/287 mention PGE and ELB as companies belonging to the same group of companies.

26. In the list (Annex 7 to the Law on cost coverage) of electricity generating plants taken into account for the allocation of stranded costs, the plants belonging to PGE appear separately from those of ELB. For its part, ELB appears as part of the holding company BOT Górnictwo i Energetyka S.A.

27. The compensation mechanism laid down in the Law on cost coverage provides for power generators to be paid an advance, the amount of which must not exceed that stipulated by the Law itself, and also for an annual payment to be made by the president of the Urzędu Regulacji Energetyki (Energy Sector Regulatory Authority; ‘URE’), calculated on the basis of a power generator’s actual financial results.

28. Annex 1 to the Law on cost coverage refers to PGE as a power generator, within the meaning of Article 2(7) thereof. According to Annex 2 to the Law on cost coverage, the maximum amount of compensation for stranded costs for that company is PLN 633496000.

29. By decision of 30 July 2010, the President of URE fixed at PLN 24077793 the amount of annual compensation payable to PGE for 2009. In fixing that sum, the president took account of ELB’s financial results, since he took the view that, in 2009, that company was part of the same group as PGE.

30. PGE brought an action contesting the decision of the President of URE before the Sąd Okręgowy w Warszawie (District Court, Warsaw), arguing that Article 32(1) of the Law on cost coverage is applicable only in the case of undertakings which are listed as belonging to the same group in Annex 7 to the Law on cost coverage and that, according to that annex, PGE was not part of the same group as ELB.

31. The District Court upheld PGE’s action and gave judgment in its favour on 4 June 2010, calculating the amount of annual compensation for stranded costs for 2009 to be PLN 116985205.

32. The appeal lodged by the President of URE was dismissed by the Sąd Apelacyjny w Warszawie (Court of Appeal, Warsaw) by judgment of 17 January 2013. In the opinion of that court, in order to take into account the financial results of another company (ELB), the latter must belong to the same group as PGE in accordance with Annex 7 to the Law on cost coverage, which was not the case.

33. The President of URE lodged an appeal on a point of law against the appellate judgment with the Sąd Najwyższy (Supreme Court), based on the alleged infringement of Articles 2(1) and (32) of the Law on cost coverage. The President of URE argued that the Law on cost coverage should be interpreted in line with the Stranded Costs Methodology and that, according to points 3.3 and 4.2 of that methodology, the stranded costs must be calculated by taking account of which companies actually belong to the group of power generators subject to the Law on cost coverage in the year to which the compensation relates.

34. Against that background, the Sąd Najwyższy made this reference for a preliminary ruling.

III – The questions referred

35. The questions in the order for reference, which was received at the Court Registry on 11 December 2014, are worded as follows: ‘(1) Is Article 107 [TFEU], read together with Article 4(3) [TEU] and Article 4(2) of the Commission Decision of 25 September 2007, to be interpreted as meaning that, where the European Commission classifies State aid as being compatible with the common market, the national court is not entitled to review whether the domestic provisions which have been deemed to constitute permitted State aid are consistent with the assumptions made in the [Stranded Costs Methodology]? (2) Is Article 107 [TFEU], read together with Article 4(3) [TEU] and Article 4(1) and (2) of the Decision of the European Commission of 25 September 2007, interpreted in the light of points 3.3 and 4.2 of the Stranded Costs Methodology, to be interpreted as meaning that, in the context of the implementation of a State aid programme which the European Commission has found to be compatible with the common market, the annual adjustment of the stranded costs incurred by group-affiliated power generators is carried out on the assumption that the position with respect to the group affiliation of the power generator as recorded in the annexes to the legislative measure examined by the Commission is alone decisive, or is it necessary to verify in respect of every year for which stranded costs are adjusted whether, during that period, the beneficiary of the State aid programme linked to the stranded costs actually belongs to the group to which the other power generators covered by the aid programme also belong?’

IV – Procedure before the Court of Justice

36. Written observations were lodged by PGE, the President of URE, the Polish Government and the Commission.

37. At the hearing, held on 27 January 2016, oral argument was presented by PGE, the Polish Government and the Commission.

V – Submissions

A –The first question

38. PGE maintains that, when the Commission assesses the compatibility of State aid with the common market, the national court does not have the power to verify whether that aid is consistent with the principles of the Stranded Costs Methodology. Otherwise, there would be an infringement of the exclusive competence of the Commission under Article 108 TFEU and, in the instant case, the national court could disregard de facto Decision 2009/287, a possibility which is expressly precluded by points 16, 17 and 20 of the Commission notice on the enforcement of State aid law by national courts. ( 6 ) Without prejudice to the fact that, faced with uncertainties concerning the interpretation of Decision 2009/87, the national court may use the Stranded Costs Methodology as an interpretative tool to resolve those uncertainties, that court may not contradict the decision itself in its rulings.

39. The President of URE contends that national courts must interpret national provisions in a way which ensures the full effectiveness of EU law on State aid. In its submission, this means that in proceedings concerning the grant of disputed State aid, the national court must interpret national law in the light of Article 4 of Decision 2009/287 and points 3.3 and 4.2 of the Stranded Costs Methodology.

40. The Polish Government, relying on the exclusive competence of the Commission to determine whether State aid is compatible with the common market, also agrees that, following the adoption of a Commission Decision, circumstances may arise which impede its implementation, a situation which would call for the Commission and the national authorities to draw up joint measures. Therefore, the Polish Government submits that, in a case like the instant case, the national court has the power, even the obligation, to verify whether the national provisions providing for the authorised aid conform to the principles of the Stranded Costs Methodology. That would ensure the correct implementation of Decision 2009/287 and, ultimately, the protection of the conditions of competition in the common market.

41. For its part, the Commission adopts essentially the same stance as that put forward by PGE. The Commission adds that, since it evaluated the Polish system of stranded costs (that is, the 2007 Law) in Decision 2009/287 on the basis of points 3 and 4 of the Stranded Costs Methodology and declared that system to be compatible with the internal market, the national court does not have the power to verify whether the Law on cost coverage was compatible with the Stranded Costs Methodology at the time when the compensation was actually paid.

B –The second question

42. PGE submits that the annual adjustment of compensation must take into account the situation obtaining at the time when the Commission examined the State aid scheme provided for in the Law on cost coverage. PGE contends that, when the Commission reviewed that scheme, it analysed and approved the rules on stranded costs laid down in the Law on cost coverage, including the different provisions of that Law. Given that the Commission authorised the method for calculating compensation at consolidated level, within the meaning of Annex 7 to the Law on cost coverage, there should be strict reference to the provisions of that Law alone in order to determine whether each power generator belongs to a certain group of undertakings.

43. The President of URE, the Polish Government and the Commission favour a ‘dynamic interpretation’ of whether a power generator belongs to a group of undertakings for the purpose of the annual calculation of compensation for stranded costs. They submit that points 3.3 and 4.2 of the Stranded Costs Methodology refer to the actual future development of competition and, therefore, to the actual market conditions at the time of payment of the State aid. They conclude from that proposition that precedence should be given to the actual composition of groups of undertakings during the year for which the adjustments are made. The Commission points out that, otherwise, if the ‘static interpretation’ put forward by PGE were adopted, any alteration of the structure of the groups of undertakings would have to be construed as falling outside the scope of Decision 2009/287, meaning that the payment of compensation in that new context would require prior notice under Article 108 TFEU.

VI – Assessment

A –The first question

44. The first question referred seeks to ascertain whether Article 107 TFEU and Article 4(3) TEU, in conjunction with Decision 2009/287 and the Stranded Costs Methodology, must be interpreted as meaning that, once the Commission has declared State aid to be compatible with the common market, the national courts may review, at the time of its implementation, whether that aid is consistent with the Stranded Costs Methodology.

45. Formulated in those terms, which are the ones used by the referring court, the question is too abstract to warrant anything other than a negative answer.

46. It is settled case-law of the Court that the Commission has exclusive competence to assess the compatibility of State aid with the common market. ( 7 ) The national courts are not entirely excluded from the system of control of State aid but their task is confined to ensuring the effectiveness of the prior control of planned State aid. In that connection, the Commission and the national courts carry out roles which are ‘complementary but separate’, ( 8 ) so that, while ‘assessment of the compatibility of aid measures with the common market falls within the exclusive competence of the Commission, subject to review by the Courts of the European Union, it is for the national courts to ensure the safeguarding, until the final decision of the Commission, of the rights of individuals faced with a possible breach by State authorities of the prohibition laid down by Article 108(3) TFEU’. ( 9 )

47. Accordingly, national courts do not have jurisdiction to rule on the compatibility of State aid with the common market or to give judgment on the validity of decisions adopted in that regard by the Commission. ( 10 )

48. In fact, the referring court does not call into question that case-law, for its question does not assume that it is entitled to rule on the validity of Decision 2009/287 as such. Nor does it ask whether it is entitled to review the contents of that decision and give a fresh ruling on whether the State aid is compatible with the common market. More subtly, the referring court seeks to ascertain whether, when interpreting and applying to the case the national legislation (the Law on cost coverage) governing the programme of aid with which Decision 2009/287 is concerned, it may ‘adjust the actual amount of the State aid granted to electricity generators under the Law on cost coverage … by reference to the assumptions on which the Commission Decision is based’. ( 11 )

49. In its own words, what the referring court asks is whether the national legislation ‘is to be interpreted as meaning that the aid mechanism provided for in the Law on Cost Coverage, the compatibility of which with the common market was examined even before it was actually implemented, must a priori be regarded as being consistent with the Stranded Costs Methodology and that there is no longer any need to verify its consistency with that methodology when the mechanism is implemented, or whether the State aid granted in implementation of the Law on Cost Coverage must be examined by national authorities and courts to determine whether it is compatible with that methodology every time the Law on Cost Coverage is applied’. ( 12 )

50. This therefore means applying the Law on cost coverage by reference to an ‘interpretative model’, ( 13 ) the ‘basis’ for which is Decision 2009/287 ‘together with the Stranded Costs Methodology’. ( 14 ) Consequently, the application of that ‘model’ could lead to aid, which, at the time of its implementation, should have been declared incompatible with the common market, nevertheless warranting no scrutiny by the Commission when carrying out only ‘a general assessment of the mechanisms of the State aid programme provided for in [the Law on cost coverage]’. ( 15 )

51. In my view, that approach cannot be accepted.

52. The State aid scheme laid down in the Law on cost coverage was given final approval under Decision 2009/287, in Article 4 of which the Commission, applying the Stranded Costs Methodology, determined that the compensation for stranded costs was compatible with the common market. That decision cannot simply be the ‘basis’ on which to construct an ad hoc criterion for interpretation which, in reality, is the Stranded Costs Methodology applied directly by national courts to reach different conclusions. Such an operation would be tantamount to the assumption by those courts of an exclusive competence of the Commission.

53. Nevertheless, after the Commission gave a decision on the particular State aid scheme laid down by the Law on cost coverage, it is possible that, in subsequent practice, there may be supervening circumstances giving rise to effects which would have led the Commission, had it known about or foreseen them, to adopt a different decision. That is the concern which appears to underlie the referring court’s questions, in the interests of ensuring compliance with EU law on State aid.

54. It is a legitimate concern which, however, cannot be addressed by attributing to the national authorities competences which are exclusive to the Commission. On the contrary, the solution must be sought in the delimitation of the ‘complementary but separate’ roles of the Commission and the Member States in this field, as described above.

55. In fact, the reply to the first question may not be particularly helpful if it is dissociated from the answer to the second question submitted by the referring court, which concerns the possible effects of the supervening changes in the facts on which the Commission relied when it adopted Decision 2009/287.

56. In any event, since the question has been formulated in general or abstract terms, it can only be answered in the negative. When the Commission declares that State aid, as laid down in a particular national law, is compatible with the common market, the national court does not have jurisdiction to review whether the law providing for that State aid is consistent with the assumptions made in the Stranded Costs Methodology.

B – The second question

57. The referring court asks whether, for the purpose of the annual calculation (that is, in order to fix the amount applicable to each year in which the adjustment is made) of compensation for stranded costs payable to an electricity generating undertaking, the fundamental factor must be: a) whether the generating undertaking belonged to a group of companies in line with the position recorded in the annexes to the Law on cost coverage, or b) whether the generating undertaking actually belonged to a different group of electricity generators from that recorded in those annexes or to the same group but composed of different companies.

58. The answer will have immediate consequences for the instant case. If the second approach (favouring a ‘dynamic interpretation’ of the composition of groups of undertakings) is accepted, the group’s financial results in the year to which the compensation payment corresponds will be relevant for the calculation. That is the view of the Polish energy regulatory authority in the main proceedings, since it decided, in line with that view, to reduce the amount payable to PGE. PGE maintains the opposite view, endorsed by the first-instance and appellate courts, which only took account of the position recorded in Annex 7 to the Law on cost coverage.

59. The second question is therefore expressed in terms which are far removed from the abstract nature of the first question. In short, the uncertainty is whether the calculation of the annual adjustment of compensation for stranded costs due to PGE for the year 2009 must take account strictly of the generation plants and electricity-sector undertakings as recorded in Annex 7 to the Law on cost coverage, or of the generation plants and electricity-sector undertakings which, in 2009, formed part of the same group of undertakings as PGE, even though the plants concerned were included in Annex 7 as forming part of a different group from PGE.

60. However, I fear that the answer to the second question will not resolve the central issue in the main proceedings, which actually concerns the interpretation and application of the Law on cost coverage rather than EU law. As PGE states in its observations (points 30 and 54), neither Decision 2009/87 nor the Stranded Costs Methodology dispel by themselves the uncertainties raised, the answer to which depends above all on the application of Articles 2 and 32 of the Law on cost coverage, in conjunction with Annex 7 thereto. Those are the provisions which will make it possible to ascertain whether the financial result of ELB in 2009 is capable of affecting, in a downward direction, the adjustment of the compensation payable to PGE, even though, according to Annex 7 to the Law on cost coverage, the planned aid did not take that factor into account.

61. From the perspective of EU law, Decision 2009/287 is merely a ‘declaration of compatibility’ of the aid with the internal market, sent to the Polish authorities so that, should they consider it expedient, they may provide State resources to undertakings in the electricity sector up to a maximum of PLN x million in successive annual periods. If, during those annual periods or financial years, the Polish authorities decide to construe the Law on cost coverage in terms which reduce — and never increase — the amount of authorised ‘costs’, their conduct cannot give rise to objections based on Decision 2009/287 itself. The decision does not, I repeat, ‘make compulsory’ or require the provision of State aid and merely declares that it is compatible with the internal market.

62. Subject to that condition, which I shall stress below, I, generally and as a matter of principle, favour the second of the two conflicting approaches: a ‘dynamic interpretation’ based on the supervening change of circumstances. Decision 2009/287 provides for the annual adjustment of compensation for stranded costs to reflect the actual situation of the market at the time the compensation is paid, which entails an assessment of developments in competition and in the market itself. The composition of groups of undertakings during the year to which the adjustment refers may reveal, from that perspective, an improvement or a worsening of the effective competition conditions in the electricity market, an adjustment factor which the decision does not exclude.

63. The requirements set out in points 3.3 and 4.2 of the Stranded Costs Methodology allow for a number of variable factors to be taken into account. According to point 3.3, ‘[i]n order to establish such cause-and-effect relationship, the Commission will in particular take into account any fall in electricity prices or market share losses suffered by the undertakings concerned’. According to point 4.2, ‘[t]he arrangements for paying the aid must allow account to be taken of future developments in competition’. Those developments ‘may be gauged in particular by way of quantifiable factors (prices, market shares, other relevant factors indicated by the Member State)’. Lastly, point 4.2 also states that ‘the amount of the aid paid will necessarily be conditional on the development of genuine competition, and the calculation of aid paid over time will have to take account of changes in the relevant factors in order to gauge the degree of competition achieved’.

64. However, it has to be assumed that the Commission weighed up all that evidence prospectively before adopting Decision 2009/287 and authorising the compensation scheme laid down by the Law on cost coverage. The Commission was aware, when examining the compatibility with the internal market of the aid linked to stranded costs, that it was giving a decision on a compensation scheme — laid down by the Law on cost coverage — which was intended to apply over a long period and was, therefore, subject to economic variables. The data used at the time of the adoption of the Law on cost coverage (including, inter alia, data relating to ownership of the generation units and the formation of undertakings into groups of companies) were not set in stone.

65. In particular, as far as it is relevant in this context, the Commission could not, quite logically, ignore the possibility of subsequent changes in the composition of the consolidated groups leading to the alteration of market conditions, which could affect the calculation of the adjustment provided for in the Law on cost coverage. Although recital 352 in the preamble to Decision 2009/287 states that ‘[t]he Commission has also taken account of the fact that the impact of stranded costs is calculated with reference to the consolidated groups’, the possibility of changes in the composition of those groups could not have been ruled out.

66. The Commission’s position in relation to the Law on cost coverage, which was adopted by taking the data set out in Annex 7 thereto to be relevant data, does not therefore exclude the fact that subsequent changes may have a bearing on the annual adjustment if they concern factors provided for in the Stranded Costs Methodology and Decision 2009/287.

67. The competitive situation in the electricity sector was one such factor. Specifically for that reason, point 4.3 of the Stranded Costs Methodology stipulates that ‘[t]he Member State must undertake to send to the Commission an annual report that, in particular, describes developments in the competitive situation on its electricity market by indicating among other things the changes observed in the relevant quantifiable factors’. ( 16 ) According to recital 369 in the preamble to Decision 2009/287, ‘[i]n accordance with point 4.3 of the Stranded Costs Methodology, the Polish authorities have undertaken to provide the Commission with an annual report on implementation of the [Law on cost coverage]’.

68. To my mind, that is the proper channel for bringing the scheme of compensation for stranded costs, laid down in the national law, into line with the actual situation in the electricity market at the time when successive adjustments of that aid are calculated.

69. Any alterations to the list of generation plants assigned to the associated undertakings (and, accordingly, to the groups of companies to which they belong), which were recorded in the annexes to the Law on cost coverage, were one of the ‘quantifiable factors’ referred to in point 4.2 of the Stranded Costs Methodology as being relevant to the assessment of ‘future developments in competition’. They were, therefore, relevant data for determining the amount of aid, the calculation of which was required to take account, ‘over time[,] … of changes in the relevant factors in order to gauge the degree of competition achieved’.

70. I believe that, in so far as it uses the Stranded Costs Methodology, Decision 2009/287 establishes a mechanism for ensuring, over time, that State aid reflects changes in the factors which determine its annual adjustment. Decision 2009/287 opted for a ‘dynamic interpretation’ of the composition of the groups of companies and of the changes in the ownership of generation units, and it also furnished, for that same purpose, the channel for communication by the Member States to the Commission of any alterations made to the consolidated groups referred to in the annexes to the Law on cost coverage.

71. As long as the Polish authorities did not inform the Commission of changes occurring in relation to the plants referred to in Annex 7 to the Law on cost coverage, they would have to comply with the contents of that annex in the manner in which it was supported by the Commission through Decision 2009/287. The Polish authorities cannot apply the Stranded Costs Methodology themselves when they carry out the annual adjustment of compensation, since in doing so they undermine Decision 2009/287.

72. It was established at the hearing that, at the relevant time, the Polish authorities submitted the annual report referred to in point 4.3 of the Stranded Costs Methodology, setting out the changes which had occurred in the structure of the electricity market. According to the statements made by its representative at the hearing, the Commission took note of those changes and concluded that, since the national authorities had complied with the maximum payment limit laid down, it was not appropriate to adopt any additional national measures, since the ‘dynamic interpretation’ of Decision 2009/287 itself allowed adjustment of the calculation of the compensation.

73. Once the Polish authorities had confirmed the new composition of the groups of companies and its effect on the allocation of the plants or generation units referred to in the annexes to the Law on cost coverage, the Commission could determine the effects of that on the calculation of the annual amount and, possibly, in the exercise of its exclusive powers, bring the provisions of Decision 2009/287 into line with the new market situation. The payment of compensation following a change in the circumstances set out in the Law on cost coverage does not necessarily require the prior control procedure established in Article 108 TFEU to be reopened. More accurately, it would be a question of using the adjustment process provided for in Decision 2009/287 itself, by means of the annual report referred to in recital 369 in the preamble thereto, as occurred in the instant case.

74. The terms in which I propose to frame the answer to the second question are, to my mind, consistent with the logic of the system of the procedure for authorising such State aid and, at the same time, respect the exclusive competence of the Commission, on the one hand, and the best guarantee of the effectiveness of the system itself, on the other, since they ensure that calculation of the aid reflects the facts at the time of implementation of the aid.

75. It should be made clear that the answer I propose is concerned solely with the Community aspect of the State aid scheme laid down in the Law on cost coverage. It is not for the Court to interpret the legislative system provided for in Polish law to address problems created following the transition to competition in the national electricity market. Subject to the condition or restriction that they must not exceed the amount of State aid declared to be compatible by Decision 2009/287 or undermine its provisions, the Polish authorities and courts may interpret their own domestic provisions on State aid linked to stranded costs as they see fit. More specifically, there is nothing to preclude their interpretation of the Law on cost coverage, based either on the contents of the annexes or on changes in the conditions of the electricity market, from leading to a higher or lower amount of annual compensation for stranded costs, provided that that compensation does not exceed the limit I have mentioned.

76. I mean by this that Decision 2009/287 is concerned simply with giving the green light to the aid planned by the national authorities, after the Commission established its compatibility with the internal market. From the perspective of Article 107 TFEU, that fact does not lead to a subjective right of possible beneficiaries to receive the aid. The existence of any such subjective right and its scope is something which must be provided for in national law, as interpreted by the competent national courts.

77. Finally, although the Polish authorities have been authorised by the Commission to grant the disputed aid, they could, for reasons considered strictly at national level and based on national law, later reduce or even abolish that aid, subject to the restrictions imposed by their own constitutional provisions. Likewise, if the national courts were to rule, when interpreting their domestic legislation, that the amount of State resources, the payment of which to undertakings in the electricity sector has been declared compatible with the internal market, should be reduced (in the instant case, that the annual compensation should be adjusted so that it is lower than that resulting from Decision 2009/287), that would not be open to objection under Article 107 TFEU either.

78. Therefore, I propose a twofold answer to the second question: a) Article 107 TFEU, in conjunction with Article 4(3) TEU, Article 4(1) and (2) of Decision 2009/287, and points 3.3 and 4.2 of the Stranded Costs Methodology, does not preclude the annual adjustment of stranded costs from being carried out on the basis of the situation of the groups of undertakings, as recorded in the national legislation governing the State aid scheme authorised by the Commission, and b) it is for the national court to interpret its national law in order to establish thereunder the consequences of changes occurring in the composition of the groups of undertakings in the electricity sector benefitting from State aid, provided that the fixing of the amount of that aid, following the adjustment as a result of the new circumstances, does not exceed the maximum amount stipulated in, or undermine, Decision 2009/287.

VII – Conclusion

79. In the light of the foregoing considerations, I propose to the Court that it reply as follows to the questions referred for a preliminary ruling: (1) Article 107 TFEU, read together with Article 4(3) TEU and Article 4(2) of Commission Decision 2009/287/EC of 25 September 2007 on State aid awarded by Poland as part of Power Purchase Agreements and the State aid which Poland is planning to award concerning compensation for the voluntary termination of Power Purchase Agreements, must be interpreted as meaning that, when the European Commission declares that State aid is compatible with the internal market, the national court does not have jurisdiction to review whether the national provisions providing for that State aid are consistent with the guidelines in the Stranded Costs Methodology. (2) Article 107 TFEU, read together with Article 4(3) TEU, Article 4(1) and (2) of Decision 2009/287 and points 3.3 and 4.2 of the Stranded Costs Methodology, must be interpreted as meaning that it does not preclude the annual adjustment of stranded costs from being carried out on the basis of the situation of the groups of undertakings, as recorded in the national legislation governing the State aid scheme authorised by the Commission. It is for the national court to interpret its national law in order to establish thereunder the consequences of changes occurring in the composition of the groups of undertakings in the electricity sector benefitting from State aid, provided that the fixing of the amount of that aid, following the adjustment as a result of the new circumstances, does not exceed the limits stipulated in, or undermine, Decision 2009/287.

( 1 ) Original language: Spanish.

( 2 ) Directive of the European Parliament and of the Council of 19 December 1996 (OJ 1997 L 27, p. 20).

( 3 ) Law of 29 June 2007 on the principles governing cost coverage by power generators in the event of the early termination of long-term contracts for the supply of electrical power and energy (Ustawa o zasadach pokrywania kosztów powstałych u wytwórców w związku z przedterminowym rozwiązaniem umów długoterminowych sprzedaży mocy i energii elektrycznej, Dz. U. No 130, Item 905 as amended (‘the Law on cost coverage’ or ‘the 2007 Law’).

( 4 ) Commission Decision of 25 September 2007 on State aid awarded by Poland as part of Power Purchase Agreements and the State aid which Poland is planning to award concerning compensation for the voluntary termination of Power Purchase Agreements (OJ 2009, L 83, p. 1).

( 5 ) Commission letter SG(2001) D/290869 of 6 August 2001, http://ec.europa.eu/competition/state_aid/legislation/specific_rules.html. The division into sections of the Spanish version of the following text differs from that of the Polish version (http://www.uokik.gov.pl/pomoc_publiczna_2.php#faq330).

( 6 ) OJ 2009 C 85, p. 1.

( 7 ) For example and in general, the judgment in Lucchini, C‑119/05, EU:C:2007:434, paragraphs 51 and 52.

( 8 ) Judgment in Deutsche Lufthansa, C‑284/12, EU:C:2013:755, paragraph 27.

( 9 ) Judgment in Deutsche Lufthansa, C‑284/12, EU:C:2013:755, paragraph 28, citing the judgments in van Calster and Others, C‑261/01, EU:C:2003:571, paragraph 75, and Transalpine Ölleitung in Österreich, C‑368/04, EU:C:2006:644, paragraph 38.

( 10 ) As the Court pointed out in the judgment in Lucchini, C‑119/05, EU:C:2007:434, paragraph 53, ‘[w]hile national courts may, in principle, have occasion to consider whether a Community act is valid, they nonetheless have no jurisdiction themselves to declare acts of Community institutions invalid ([judgment in Foto-Frost, 314/85. EU:C:1987:452] paragraph 20). The Court of Justice alone therefore has jurisdiction to determine that a Community act is invalid ([judgments in Zuckerfabrik Süderdithmarschen and Zuckerfabrik Soest, C‑143/88 and C‑92/89, EU:C:1991:65], paragraph 17, and [IATA and ELFAA, C‑344/04, EU:C:2006:10], paragraph 27)’.

( 11 ) Page 13 of the original text of the order for reference.

( 12 ) Page 14 of the original text of the order for reference.

( 13 ) Page 16 of the original text of the order for reference.

( 14 ) Loc. cit.

( 15 ) Page 14 of the original text of the order for reference.

( 16 ) Point 4.3 goes on to state that that report ‘will give details of how the stranded costs taken into account for the relevant year have been calculated and will specify the amounts of aid paid’.