WRITTEN QUESTION E-1709/97 by Hiltrud Breyer (V) to the Council (22 May 1997)

Subject: Electricity Grid Feed Act

The letter of 26 October 1996 from Commissioner Van Miert to Germany's Federal Minister for Economic Affairs, Rexrodt, refers to adverse effects of the Electricity Grid Feed Act on intra-Community trade in electricity. In connection with the letter, Directorate-General XVII was also asked to deliver an opinion. An internal note to DG IV from DG XVII dating from summer 1996 mentions alleged 'disproportionately high windfall profits' associated with new or prospective wind power facilities in Germany. In the meantime (at the beginning of 1997), studies by German research institutes concerning trends in the cost of wind power have been published showing that the Electricity Grid Feed Act clearly does not result in excessive subsidies being paid. These studies demonstrate that only at favourable coastal sites do the rates of subsidy currently granted permit the facilities to operate economically. This calculation does not even take account of the impact of possible future damage to facilities and repair work.

1. Is the Council aware of these studies?

2. What is the Council's view of the call in the above-mentioned internal note for renewable energy to be promoted purely by means of public budget funding rather than by maintaining and further developing the most successful instruments for the promotion of renewable energy supplies, which do not require any public funding at all (such as the Electricity Grid Feed Act)? Is not such a call for public funding contrary to the Maastricht criteria, which require restrictive budgetary policies?

3. According to the information available to the Council, what methods of promoting renewable energy have been most successful in recent years? Is not a system of guaranteed minimum prices the most efficient way of ensuring that renewable energy penetrates markets as rapidly as possible?

Joint answer to Written Questions E-1707/97, E-1709/97, E-1711/97 and E-1713/97 (25 September 1997)

1. The Council agrees with the Honourable Member that renewable energy has an important role to play in the endeavours of the Community and the Member States to protect the environment. In its common position on the review of the European Community programme of policy and action in relation to the environment and sustainable development "Towards sustainability¨ ((OJ C 157, 24.5.1997, p. 12. )), the Council suggested priorities for the energy sector. Among these priorities are: to promote energy efficiency and the rational use of energy and to support the development and application of energy-saving technologies and practices including programmes and measures, awareness-raising and information measures, and to develop criteria for the screening of subsidy schemes in order to redress incentives which have an adverse effect.

Furthermore, the Council Resolution on renewable sources of energy agreed upon by Energy Ministers at the Council meeting on 27 May 1997 contains the position of the Council on various issues connected with renewables and, more specifically, questions raised in the Commission's Green Paper for a Community Strategy - Energy for the future: renewable sources of energy. The resolution lists a series of measures that could increase the consumption of renewable energy. These include actions and measures in the fields of research, development and demonstration; market conditions; consumer information and confidence; and coordination and monitoring. The resolution also notes that an active governmental policy, both at Member State and at Community level, is necessary to improve the competitiveness of renewables.

Thus, the Council is well aware of the efforts required to meet the indicative target to double the overall share of renewables by 2010.

2. It is not for the Council to express an opinion on legislative measures taken in one of the Member States of the European Community. Pursuant to article 93 of the EC Treaty, the Commission is endowed with the powers to keep under review all systems of aid existing in Member States in order to ascertain that they are compatible with the Common Market.

3. The Council has no knowledge of the letter referred to in the questions. Nor is the Council aware of an "internal note¨ of the Commission services mentioned in the questions of the Honourable Member.