WRITTEN QUESTION E-2650/98

by Friedhelm Frischenschlager (ELDR) to the Commission

(1 September 1998)

Subject: Unauthorised subsidies for nuclear energy

The liberalisation of the European energy market is marching onwards and within the next few years will lead to substantial reductions in energy prices, to the benefit of citizens, as a result of increasing competition. However, the process set in train by the Commission must be subject to continuing monitoring over the next few years to ensure that subsidies (in the broadest sense) do not lead to market distortions which would have economically and environmentally undesirable long-term consequences. The peaceful use of nuclear energy, in particular, prompts the question as to whether this sector does not enjoy such subsidies on a massive scale, thereby affecting the market opportunities of other forms of energy production, particularly production from renewable sources.

Does the Commission consider that nuclear power stations and/or their operators receive subsidies, in the broad sense, which are incompatible with EU law, e.g. in the form of inadequate regulations and liability provisions, (misdirected) research funding, State guarantees, etc.?

If not, can the Commission confirm that the cost accounting of nuclear power station operators makes adequate provision for:

- the damage and devastation that might occur in the event of an accident (worst-case scenario);

- the final storage of radioactive material or the complete reprocessing thereof;

- safe closure and preservation of nuclear power stations for the period of time during which they represent a health and environmental risk, or environmentally safe scrapping at the end of their relatively short operating life?

If not, how does the Commission explain the price structure of nuclear energy? Would the Commission accept such incomplete cost accounting and its consequent price structure from other energy producers, particularly private-sector energy producers?

What does the Commission consider to be the likelihood of success if a traditional energy producer were to bring proceedings under competition law against a nuclear operator?

Answer given by Mr Van Miert on behalf of the Commission

(1 October 1998)

With the exception of a complaint currently under examination, the Commission currently has no evidence of subsidies for nuclear power plants that are incompatible with Community law.

The regulations on the obligation to build up reserves for nuclear damage, disposal of fuel elements and decommissioning fall under the competence of the Member States. Partly, they are based on international conventions aiming at the establishment of a general safety framework for nuclear risks.

Under Article 24 of Directive 96/92/EC of the Parliament and of the Council of 19 December 1996 concerning common rules for the internal market in electricity(1), Member States have the possibility to notify to the Commission commitments or guarantees of operation given before the entry into force of the directive, which may not be honoured on account of the provisions of the directive, with a view to applying the transitional arrangements indicated in that article. The Commission is about to examine those notifications. Should the Commission - in this or any other context - be provided with concrete information about cost advantages that are not in line with Community state aid rules, it will examine them diligently.

The Commission is obliged to examine complaints from undertakings or people against breaches of Community competition rules. The likelihood of success depends upon the individual case and cannot be assessed in advance.

(1) OJ L 27, 30.1.1997.