Invitation to submit comments pursuant to Article 1(2) in Part I of Protocol 3 to the Surveillance and Court Agreement concerning aid measure — proposed aid scheme to utilise energy from final waste treatment plants (State aid SAM 030.03001)
Date: 2003-12-11
Institutions: EFTA Surveillance Authority
Subjects: Norway, State aid, control of State aid, energy production, waste recycling

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Invitation to submit comments pursuant to Article 1(2) in Part I of Protocol 3 to the Surveillance
and Court Agreement concerning aid measure — proposed aid scheme to utilise energy from final
waste treatment plants (State aid SAM 030.03001)

(2004/C 82/06)

By means of Decision 257/03/COL of 11 December 2003, reproduced in the authentic language on the
pages following this summary, the EFTA Surveillance Authority initiated proceedings pursuant to Article
in Part I of Protocol 3 of the Agreement between the EFTA States on the establishment of a
1(2)
Justice (Surveillance and Court Agreement). The Norwegian
Surveillance Authority and a Court of
Government has been informed by means of a copy of the decision.

The EFTA Surveillance Authority hereby gives the EFTA States, EU Member States and interested parties
notice to submit their comments on the measure in question within one month from the publication of
this notice to:

EFTA Surveillance Authority
74, rue de Trèves/Trierstraat 74
B-1040 Brussels

The comments will be communicated to the Government of Norway. Confidential treatment of the identity
of the interested party submitting the comments may be requested in writing, stating the reasons for the
request.

SUMMARY

Procedure

the
By letter of 29 January 2003 (Doc. No 03-654-A),
to
Norwegian authorities notified the Authority pursuant
Article 1(3) in Part I of Protocol 3 to the Surveillance and
Court Agreement of their intention, as from 1 July 2003, to
introduce a new aid scheme aimed at the promotion of energy
production from landfills and final waste treatment plants.

2003,

In March
additional
the Authority
information, in particular information necessary for assessing
the scheme under option 1 and 3 on operating aid for
renewable energy sources of Chapter 15 of the Authority's
State Aid Guidelines regarding environmental aid.

requested

Description of the aid measure

The notification concerns an aid scheme for the utilisation of
energy from final waste treatment plants that are required to
pay tax on final waste treatment (‘Tilskudd til utnyttelse av
energi fra avgiftspliktige sluttbehandlingsanlegg for avfall’).

The objective of
to increase energy
the aid scheme is
production from waste, thereby achieving Norway's climate
and waste policy goals. While the scheme aims to increase
energy production from waste,
it also aims to compensate
the aid beneficiaries for increased costs for waste incinerations
resulting from an intended change in the waste
plants,
treatment tax.

In May 2003, the Norwegian authorities submitted additional
information. Since the Norwegian authorities suggested that the
scheme should be assessed under option 3 on operating aid for
renewable energy sources of Chapter 15 of the Authority's
State Aid Guidelines, they did not fully supply the information
requested under the part of the Authority's information request
which dealt with option 1 under the same Chapter. Further
information was submitted in October 2003. The Norwegian
authorities stated that some of the information and documen-
tation the Authority requested was not available and that
Norway considered the notification to be complete. Norway
further informed the Authority that
the implementation of
the proposed aid scheme was postponed until 1 July 2004.

By letter dated 19 November 2003 (Doc. No 03-7885-D) the
Authority informed the Norwegian Government of its doubts
regarding the compatibility of the scheme with Article 61(3)(c)
of the EEA Agreement.

At present, there is a tax on final waste which is paid by
landfill operators and waste incineration plants and is levied
on the tonnage of waste delivered. The tax is differentiated in
that tax deductions are available for waste incineration plants
which utilise the energy produced by the waste incineration,
for heat or electricity. The Norwegian Government
either
informed the Authority that
the differentiated tax will be
replaced by a new regime which levies taxes on the actual
emissions of pollutants from the incineration. The present
system of
tax deductions was considered an inadequate
to waste based energy production, and it was
stimulus
proposed to adopt a separate aid scheme based on the actual
energy produced and delivered to the consumer rather than
having reduced tax rates according to the percentage of
thereby
energy utilised. The system of
abolished,
leading to increased costs for waste incineration
plants. According to the Norwegian authorities, without state
support, waste incineration plants would not be able to
compete with other energy producers who do not have to
pay a similar tax on the release of pollutants.

tax deductions is

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The amended waste treatment tax

In its 2003 budget, the Norwegian Parliament decided to alter
the existing final waste treatment
tax (see St.prp. nr. 1
(2002-2003) Skatte-, avgifts-, og tollvedtak). The restructuring
the tax requires amending Regulation No 1451 of 11
of
December 2001 on special taxes. Section 3-13 of this Regu-
lation concerns the special provisions on taxes on final waste
disposal. The Authority understands that while the tax on
landfills has already entered into force on 1 July 2003, the
tax on waste incineration is postponed until 1 July 2004.

The main change of the tax scheme is the change of the tax
from a tonnage rate to a tax on actual emissions, with a rate
the release of
based on the actual environmental costs of
pollutants in incineration plants. The tax deductions for the
utilisation of waste energy will be repealed, which, according
to the Norwegian authorities, leads to higher unit production
costs and creates a competitive disadvantage for energy
production from waste in comparison to energy production
from other sources. The increased unit costs of utilising
energy in the incineration plants is assessed to be about
NOK 0,10 pr. kWh.

The notified aid scheme

The notified aid scheme should compensate for these higher
costs and also stimulate the utilisation of
the unexploited
potential for energy production from waste.

Legal Basis

The legal basis of the aid scheme will be a special regulation
pursuant
to Section 33 of Act of 13 March 1981 No. 6
relating to Protection against Pollution and on Waste (‘Lov
om vern mot forurensninger og om avfall’), i.e. a (draft) Regu-
lation on aid for the utilisation of energy from final waste
treatment plants that are required to pay tax on final waste
treatment (‘Utkast til forskrift . . . om tilskuddsordning til ener-
giutnyttelse fra avgiftspliktige sluttbehandlingsanlegg for avfall’),
hereinafter the Draft Regulation.

Form of aid and aid beneficiaries

The potential aid recipients must be waste incineration plants
or landfills covered by the waste treatment tax. The aid is given
in the form of grants.

Eligible costs

The grant is connected to the energy production from the
renewable part of the waste. The energy production that is
related to the incineration of the fossil non-renewable part of
the waste (plastic) is deducted from the grant. This leads to the
creation of two different aid rates.

(a) A high rate will apply to incineration plants which can
document that they only incinerate separated fractions of
waste that do not contain plastic or other fossil materials.

The high rate also applies to all landfills.

(b) A low rate, which constitutes 60 % of the high rate, will
apply to those waste incineration plants, which incinerate
waste that may contain fossil material.

fossil materials

the average content of

The difference between the two rates is based on estimates
showing that
in
household or mixed municipal waste is 13 %, which accounts
for 40 % of the energy potential contained in the waste. The
firms who receive the low rate thus receive a grant corre-
sponding to the estimated 60 % of
the energy potential
sources. The Norwegian
which stems
13 % of
proportion
Government
of
non-renewable
an average
in waste
estimate. The same is the case for energy potential (40 %) as
a result of using non-renewable material. According to the
Norwegian Government,
to get
information on the exact fractions for each individual waste
incineration plant. Norway presented a formula, according to
which the application of the high rate and the low rate would
require an estimated budget of NOK 80 million for 2003.

from renewable
the
that
sources

it would be

difficult

energy

states

is

Various cost calculations provided by Norway

Norway has submitted various cost calculations for assessing
the aid primarily under option 3 on operating aid for
renewable energies in Chapter 15 of the Authority's Guidelines.
These calculations concerned inter alia the production costs of
various energy sources and a comparison of the production
costs of waste-based energy with the market price for elec-
tricity.

For the purpose of analysing the proposed aid scheme under
option 3 on operating aid for renewable energy, the Norwegian
authorities submitted external costs of different energy carriers
and a comparison of energy production from waste with
energy production from heavy oil to see which environmental
costs are paid by the energy producers. External costs are the
environmental costs that society would have to bear if the
same amount of energy were produced by a production
forms of energy for the
plant operating with conventional
treatment of waste.

Details of these calculations can be taken from the text of the
decision below.

Appreciation of the aid

The proposed aid scheme constitutes aid within the meaning of
the EEA Agreement. The Authority then
Article 61(1) of
examined whether
could be
justified according to Article 61(3)(c) of the EEA Agreement
in conjunction with Chapter 15 of the Authority's State Aid
Guidelines on aid for environmental protection.

the proposed aid scheme

Option 3 on operating aid to renewable energies under Chapter 15,
D.3.3.3 — of the Authority's State Aid Guidelines

The Authority first assessed the proposed scheme under
Chapter 15, D.3.3.3 — Option 3 of the Authority's State Aid
Guidelines, which in paragraph 58 stipulates the ‘EFTA States
may grant operating aid to new plants producing renewable
energy that will be calculated on the basis of the external costs
avoided’. The Authority had the following doubts as to whether
the proposed aid scheme could be justified on the basis of that
provision:

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Waste is a renewable energy source within the meaning of the
Authority's State Aid Guidelines and Directive 2001/77/EC.
The Authority is, however, concerned to which degree the
proposed aid scheme will also support
the fossil elements
contained in mixed waste. The Authority is aware that there
are two different aid rates for mixed waste (containing fossil
material) and waste which does not contain any fossil elements.
However, on the basis of the given information, the Authority
the low aid rate suggested by the
cannot be certain that
too generous and supports
is not
Norwegian authorities
waste incineration of waste containing fossil material to the
detriment of separating and recycling waste.

Aid Guidelines. On the basis of the given information, the
Authority could not form a final view on this question.

The Authority finally does not have sufficient information as to
whether the aid scheme is to support to ‘new plants’ or new
investments as required by option 3 on operating aid for
renewable energy in Chapter 15 of the Authority's State Aid
Guidelines, since the system is aimed at the support of existing
plants. The Authority also has doubts as to whether the
requirement to invest any aid exceeding the amount of aid
resulting from option 1 of Chapter 15 on operating aid for
renewable energy would be respected.

As to the comparison of external costs incurred and paid for
by waste-based energy producers in comparison to energy
producers who use heavy oils,
the Authority had the
following doubts. Firstly, the Norwegian authorities have not
explained why the comparison with light oils was omitted for
the purpose of calculating the external costs avoided. Secondly,
it was also not explained why the comparison with heavy oil
was regarded as the most relevant comparison, given the fact
that figures on district heating demonstrate that the production
is the closest
of heat by electricity (based on hydro energy)
substitute for waste-based production of heat energy. The
Authority
calculation of
external costs for waste-based energy can be based on high
the
technology waste plants given the fact at present
scheme is directed at existing waste incineration plants which
are not necessarily equipped with the high technology
standard. These plants might cause higher environmental
costs, which are not fully paid for by the waste-to-energy
producers.

thirdly questions whether

that

the

When calculating the high and low aid rates based on the
figures for the external costs avoided in the production of
energy from heavy oil,
the Authority could not exclude a
risk of overcompensation. According to the Authority's calcu-
lation on the basis of the figures presented by Norway, a much
lower yearly budget
than NOK 80 million (i.e. NOK 46
million) would be sufficient. Contrary to the suggestion by
the Norwegian authorities, the Authority's preliminary view is
that for the calculation of external costs paid by the producer
of energy based on heavy oil, the heating oil tax must be taken
into account, given that it has a discernable positive effect on
the environment as stipulated in paragraph 7 of Chapter 15 of
the Authority's Guidelines and should be regarded as an
environmental tax.

The
information given by Norway only concerned the
production of heat energy by waste incineration plants.
Consequently,
sufficient
information to assess the compatibility of aid for electricity
production from energy. Nor can it assess the aid scheme
with regard to heat or electricity production by landfills.

does not have

the Authority

Assessment under option 1 on operating aid for renewable energies
according to Chapter 15, D.3.3.1 of the Guidelines

The Authority has also made an assessment under the above
mentioned option 1 on operating aid for renewable energies
which stipulates that ‘EFTA States may grant aid to compensate
for the difference between the production cost of renewable
energy and the market price of the form of power concerned’.

However, on the basis of the given information, the Authority
has doubts as to whether the aid scheme is compatible under
that option. The Authority does not have any information as
regards waste-to-energy production by landfills.

As to the production costs of waste incineration plants, the
Authority notes that it still has not received any detailed and
precise cost calculation method. Details on cost savings, as well
as on the depreciation rate and time have not yet been given.

Furthermore, the Authority cannot be certain that the calcu-
lation of the production costs will only cover that part directly
related to the production of energy and leave aside those costs
which result from the treatment of waste as such. While the
this
Authority
in obtaining
information,
the aid does not support
activities and mitigate the related costs which the undertakings
have to bear according to obligations resulting from regulatory
national and European law.

it must ensure that

takes note of

difficulties

Conclusions

The aid proposed for the project constitutes aid within the
meaning of Article 61(1) of
the EEA Agreement. The
Authority has doubts as to whether the notified aid may be
regarded as compatible with the functioning of
the EEA
Agreement, and in particular Article 61(3)(c), because the
information submitted by the authorities does not demonstrate
that the conditions set out in Chapter 15 of the Authority's
State Aid Guidelines are fulfilled.

The Authority also had doubts as to whether the methodology
applied by the Norwegian authorities, the so-called abatement
cost method, was applied consistently to the calculation of all
environmental costs and moreover whether this method was
‘internationally recognised’ as required by the Authority's State

Consequently, the Authority is obliged to open the formal
investigation procedure provided for in Article 1(2) in Part I
of Protocol 3 to the Surveillance and Court Agreement against
the proposed aid scheme to utilise energy from final waste
treatment plants.

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‘I. FACTS

1. Procedure

By letter of 29 January 2003 from the Mission of Norway to
the European Union, forwarding letters from the Ministry of
Trade and Industry and from the Ministry of Environment both
received and registered by the
dated 24 January 2003,
Authority on 31 January 2003 (Doc. No 03-654-A),
the
in
to Article 1(3)
Norwegian authorities notified pursuant
Part I of Protocol 3 to the Surveillance and Court Agreement (1)
an aid scheme to utilise energy from final waste treatment
plants.

In this letter the Norwegian Government notified the Authority
of the intention, as from 1 July 2003, to introduce a new aid
scheme aimed at the promotion of energy production from
landfills and final waste treatment plants.

By letter of 3 March 2003 (Doc. No 03-682-D) the Authority
acknowledged receipt of
the notification and requested
additional information, in particular information necessary for
assessing the scheme under option 1 and 3 on operating aid
for
the
Authority's Environmental Guidelines.

energy resources of Chapter 15 of

renewable

By letter dated 5 May 2003 from the Mission of Norway to the
European Union forwarding letters dated 30 April 2003 from
the Ministry of Trade and Industry and the Ministry of the
Environment, received and registered by the Authority on 7
May 2003 (Doc. No 03-2862-A), additional information was
submitted. Since the Norwegian authorities suggested assessing
the scheme under option 3, they did not fully supply the
information requested under
the Authority's
information request which dealt with option 1.

the part of

By letter dated 7 July 2003 (Doc. No 03-3716-D),
the
Authority acknowledged receipt of the additional information
and requested further
the
Norwegian authorities, the deadline to respond to this letter
was extended by the Authority.

information. On request of

By letter from the Norwegian Mission to the European Union
dated 7 October 2003, forwarding letters from the Ministry of
Trade and Industry and the Ministry of Environment of 6
October 2003, Norway provided further
information. The
letter was received and registered by the Authority on 9
letter
October 2003 (Doc. No 03-6911-A).
the
Norwegian authorities stated that some of
the information
requested, was not
documentation the Authority
and
available and that Norway had no further information to
give.
that while there would always be a
further possibility of refining the information, the Norwegian
authorities had supplied as complete information as possible
related to the notification of the proposed aid scheme. Norway
complete. The
thus
Norwegian authorities
the
regards
the proposed aid scheme, which was
implementation of

considered the notification to be

indicated, however, as

It also stated,

In this

(1) Article 1(3) in Protocol 3, before the amendments to Protocol 3 of
the Surveillance and Court Agreement, agreed upon by the EFTA
States on 10 December 2001, entered into force. The amendments
entered into force on 28 August 2003. The former Article 1(3) is
now laid down in Part I of Protocol 3.

originally foreseen for 1 July 2003, they would provide further
information as requested at a later stage.

By letter from the Norwegian Mission to the European Union
dated 21 October 2003, forwarding letters from the Ministry of
Trade and Industry and of the Ministry of the Environment
both dated 17 October 2003,
the Norwegian authorities
informed the Authority that the aid scheme would not be
implemented before 1 July 2004. This letter was received
and registered by the Authority on 22 October 2003 (Doc.
No 03-7281-A). The Authority acknowledged receipt by
letter dated 31 October 2003 (Doc. No 03-7468-D).

By letter dated 19 November 2003 (Doc. No 03-7885-D), the
Authority informed the Norwegian Government about
its
doubts
scheme with
Article 61(3)(c) of the EEA Agreement.

compatibility of

regarding the

the

The Norwegian authorities acknowledged receipt of this letter
by letter
from the Ministry of Trade and Industry dated
8 December 2003 (03-8647-A).

2. Description of

the proposed waste-to-energy aid

scheme

2.1. Title and objective of the aid scheme

The notification concerns an aid scheme for the utilisation of
energy from final waste treatment plants that are required to
pay tax on final waste treatment (‘Tilskudd til utnyttelse av
energi fra avgiftspliktige sluttbehandlingsanlegg for avfall’).

The objective of
to increase energy
the aid scheme is
production from waste, thereby achieving Norway's climate
and waste policy goals.

2.2. Background

While the scheme aims at increasing energy production from
it also aims at compensating the aid beneficiaries for
waste,
increased costs for waste incinerations plants, resulting from an
intended change in the waste treatment tax.

At the present time, there is a tax on final waste which is paid
by landfill operators and waste incineration plants and is levied
on the tonnage of waste delivered. The tax is differentiated in
that tax deductions are available for waste incineration plants
which utilise the energy produced by the waste incineration,
for heat or electricity. The Norwegian Government
either
informed the Authority that
the differentiated tax will be
replaced by a new regime which levies taxes on the actual
emissions of pollutants from the incineration. The present
system of
tax deductions was considered an inadequate
to waste based energy production, and it was
stimulus
proposed to adopt a separate aid scheme related to the
actual energy produced rather
than having reduced rates
according to the percentage of energy utilised. The system of
tax deductions is thereby abolished, leading to increased costs
for waste incineration plants. According to the Norwegian
authorities, without state support, waste incineration plants
would not be able to compete with other energy producers
which do not have to pay a similar tax on the releases of
pollutants.

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the Norwegian authorities propose an aid
Consequently,
scheme of direct grants whose potential beneficiaries are
those undertakings which are subject to the (amended) tax
on final waste treatment.

In order to understand this background,

it is appropriate to

— explain the present waste treatment tax (2.2.1),

— present the intended changes in the waste treatment tax
about which Norway informed the Authority in the
context of the notification of the aid scheme (2.2.2)

before the notified aid scheme is described in 2.3.

The current tax rate for landfills is NOK 327 (4) per tonne
waste delivered. The tax rate for waste incineration plants
consists of two elements, a basic rate applicable to all plants
(at NOK 82) and an additional tax, depending on whether the
plant makes use of the energy produced in the waste treatment
process, either for electricity or heat (up to a maximum of
NOK 245). The basic tax is therefore gradually increased
according to the degree to which the waste incineration
plant does not make use of the energy produced. A plant
that does not use any of its incinerations to produce energy
is levied with the same tax rates as landfills (NOK 82 plus
NOK 245 = NOK 327). Thus,
the tax rate is differentiated
according to the degree of energy recovery and utilisation.

2.2.1. The current tax rules on final waste treatment

2.2.2. The amendments to the waste treatment tax

The current tax on final waste treatment was introduced 1
January 1999 as one of several measures designed to fulfil
Norway's obligations under the Kyoto Protocol. The purpose
of the tax is to put a price on the emissions resulting from final
treatment of waste and to provide an incentive to reduce the
amount of waste, to recycle waste and to utilise waste for
energy purposes. Norway considers the tax to be an environ-
mental tax (2).

The tax is paid by waste incineration plants and landfill
operators. It is levied on the deposit of waste to landfills and
to incineration plants, based on the tonnage of waste delivered.
General exemptions from the tax apply for:

— high-risk (hazardous) waste subject to special regulations

and delivered to special receiving stations,

— deposits for

for
reuse or
recycling (not delivered to landfills or incinerations plants),

to be sorted out

recycling,

— deposits of homogenous, inorganic material disposed of in
separate storage (not leading to emission of greenhouse
gases),

— industrial plants that incinerate processed waste (avfalls-
baserte brensler) and utilise the energy recovered for
industrial production, are deemed as recovery plants and
are not covered by the tax,

— residual waste from utilization of recycled fibres in the pulp

and paper industry and

— deposits of waste consisting of polluted soil and waste

banks.

As stated by the Norwegian authorities, plants covered by the
tax and the proposed scheme in general are plants that
incinerate municipal waste or similar waste from business
incinerate ‘processed waste’ (3) and
activities, or plants that
use the energy for heating houses (i.e. not for ‘industrial use’).

(2) The current

tax is based on the annual

tax decisions by the
Parliament with further regulations in Section 3-13 of the Regu-
lation on Excise Duties of 11 December 2001 No. 1451.

In its budget of 2003, the Norwegian Parliament decided to
alter the existing final waste treatment tax. The amendments to
the tax framework were proposed in St.prp. nr. 1 (2002-2003)
Skatte-, avgifts-, og tollvedtak. The restructuring of the tax
requires amending Regulation No 1451 of 11 December
2001 on special
this Regulation
taxes. Section 3-13 of
the special provisions on taxes on final waste
concerns
disposal. The Authority understands that while the tax on
landfills has already entered into force (5) on 1 July 2003, the
tax on waste incineration is postponed until 1 July 2004.

The main change of the tax scheme is the change of the tax
from a tonnage rate to a tax on actual emissions, with a rate
based on the actual environmental costs of the releases in
incineration plants. According to the Norwegian Government,
this reflects the true environmental costs in a more precise
manner. The present
tax differentiation system will be
abolished and the tax deductions for the utilisations of waste
energy will be repealed and be replaced by a grant scheme.

The scope of the waste treatment tax

While the amendment of the waste treatment tax brings about
a change in the levy of the tax from a tonnage based to an
emission based tax, the general scope of the waste treatment
tax has not been amended. The exemptions to the waste
treatment
tax as adopted in 1999 remain the same (see
above, point I, 2.2.1).

The tax rates

W a s t e i n c i n e r a t i o n p l a n t s

The tax rates shall be levied on emissions of different pollutants
measured, except for CO2, for which the tax rate is fixed at
NOK 39 per
tonne waste delivered. According to the
Norwegian Government, the taxation based on weight is due
the Directive 2000/76/EC (6) has no
to the
requirements to measure emission of CO2 and that releases
of CO2 cannot be rinsed at a reasonable cost.

that

fact

(3) Processed waste is defined by the Norwegian authorities as waste
that consists of material suitable for incineration; waste that has
been sorted and processed in some manner; waste that has a spe-
cification in real market and will compete with other energy
carriers; waste which has a net caloric value of at least 15 MJ/kg;
waste which is stable for storing.

(4) Figure for 2003 (first half). The tax remained largely unchanged

over the past four years.

(5) See ‘Budsjett 2004, 14 Resultatområde 6: Avfall og gjenvinning’.
(6) OJ L 332, 28.12.2000, p. 9, incorporated into Annex XX, point 20
of the EEA Agreement by Joint Committee Decision 57/2003.

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The tax rate is based on an average estimate of the contents of
fossil material in waste for households. Incineration plants that
do not burn fossil material are exempted from this tax.

2.3.3. Form of aid and aid beneficiaries

The potential aid recipients must be waste incineration plants
or landfills covered by the waste treatment tax (9).

L a n d f i l l s

For landfills, no tax rates directly related to the environmental
costs of releases have been established. However, there is an
fulfilling the
for
increase
requirements in the Landfill Directive 1999/31/EC (7).

landfills not

tax rate

in the

Accordingly, two rates now apply, a rate of NOK 327 for
landfills
regulation dated
21 March 2002 (implementing the Landfill Directive), and
NOK 427 for landfills not meeting these requirements.

requirements of

fulfilling

the

2.3. The notified aid scheme

2.3.1. Introduction

The new tax regime, as described above, no longer provide for
tax reductions depending on energy utilisation. According to
the Norwegian authorities, this leads to higher unit production
costs and creates a competitive disadvantage for energy
production from waste in comparison to energy production
from other sources. The increased unit costs of utilising
energy in the incineration plants is assessed to be about
NOK 0,10 pr. kWh (8).

To stimulate the utilisation of unexploited potential
(which
according to the Norwegian Government involves an increase
by 2 TWH by 2010 and an annual increase of 300 GWh), a
grant scheme is proposed, which relates to the actual amount
of energy produced, rather than having reduced tax rates
according to the percentage of
the energy utilised by the
plants as under the current system. The Norwegian authorities
argue that direct subsidies can be targeted more precisely
towards energy utilisation than the former tax differentiations.

2.3.2. Legal Basis

The legal basis of the aid scheme will be a special regulation
pursuant to Section 33 of Act of 13 March 1981 No 6 relating
to Protection against Pollution and on Waste (‘Lov om vern
mot forurensninger og om avfall’), i.e. (draft) Regulation on aid
for the utilisation of energy from final waste treatment plants
that are required to pay tax on final waste treatment (‘Utkast til
forskrift
. . . om tilskudddsordning til energiutnyttelse fra
avgiftspliktige sluttbehandlingsanlegg for avfall’), hereinafter
the Draft Regulation.

The Legal Basis for the State support is the annual budget
decision by Parliament, St.prp.no 1 (2002-2003) Miljøvernde-
partementet and B.innst S.Nr.9 (2002–2003).

This implies that the waste incineration plants covered by the
tax and the proposed scheme in general will be plants that
incinerate municipal waste or similar waste from business
activities, or plants that incinerate ‘processed waste’ and use
the energy for heating houses, i.e. not for ‘industrial use’.

The Norwegian Government has identified 21 waste incin-
eration plants as potential beneficiaries of the scheme, i.e. the
undertakings being covered by the current tax on final waste
treatment as of 1 January 2002.

As for the landfills,
the aid will be given for the energy
production from landfill gas. No further details on the
expected aid beneficiaries were given, since very few landfills
use energy recovered from landfill gas today.

The aid is given in the form of grants.

2.3.4. Eligible costs

The aid is granted on the basis of the energy produced and
marketed. A distinction is made on energy used for heating
purposes and energy converted to electricity.

According to section 3-1 of the Draft Regulation, in the case of
energy which is delivered as heat energy for district heating or
collective heating, aid shall be given for the number of kWh
for which delivery can be documented. Energy converted into
electric power, can receive aid for the amount of energy
measured in kWh that is delivered as actual electric power to
a specific customer or to the power grid. The aid is conditional
on invoices or other equivalent documentation confirming the
actual energy delivered.

The grant is connected to the energy production from the
renewable part of the waste. The energy production that is
related to the incineration of the fossil non-renewable part of
the waste (plastic) is deducted from the grant. This leads to the
creation of two different aid rates.

(a) A high rate will apply to incineration plants which can
document that they only incinerate separated fractions of
waste that do not contain plastic or other fossil materials.

It also applies to all
landfills, which utilise methane gas as
energy, because energy production from methane gas from
land fillings is solely based on the biodegradable fraction in
the waste.

(b) A low rate, which constitutes 60 % of the high rate, will
apply to those waste incineration plants, which incinerate
waste that may contain fossil material.

(7) OJ L 182, 16.7.1999, p. 1, incorporated into Annex XX, point 32d
of the EEA Agreement by Joint Committee Decision 56/2001.
(8) Based on the value of the tax deductions divided by the amount of

energy produced in 2001 (960 GWh).

(9) The landfills and plants exempted from the tax will not be granted
aid in order to avoid the unintended benefit of both avoiding the
tax and in addition being eligible for grants.

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fossil materials

the average content of

The difference between the two rates is based on estimates
showing that
in
household or mixed municipal waste is 13 %, which accounts
for 40 % of the energy potential contained in the waste. The
firms who receive the low rate thus receive a grant corre-
sponding to the estimated 60 % of
the energy potential
sources. The Norwegian
which stems
proportion
Government
13 % of
of
non-renewable
an average
in waste
estimate. The same is the case for energy potential (40 %) as
a result of using non-renewable material. According to the
Norwegian Government, it would be very difficult and costly
to get information on the exact fractions for each individual
waste incineration plant.

from renewable
the
that
sources

energy

states

is

The rates are based on the yearly Parliamentary budget
decisions. In the latter half of 2003, the rates are estimated
to be respectively NOK 0,10 pr. kWh (high rate) and
NOK 0,06 per kWh (low rate). These figures are derived
from the following calculation, based on the budgetary allo-
cation of NOK 80 million and on the estimated output from
the two types of processes.

1 300 000 000 kWh × 0,60 X + 50 000 000 kWh × X =
NOK 80 000 000,

(i.e. waste

the high rate, and 0,60 X the low rate.
whereby X is
1 300 000 000 kWh are expected to be calculated with the
low rate
containing fossil material), whereas
50 000 000 kWh are calculated according to the high rate.
On that basis, the high rate is calculated and rounded off to
NOK 0,10 and the low rate is consequently NOK 0,06 per
kWh.

This level would — according to the Norwegian Government
— imply a compensation level of the same magnitude as the
value of the current tax differentiation.

According to the Norwegian Government, the grant rate will
be determined annually and be dependent on the general price
of
competing energy. The Norwegian Government has
accepted that the rate should not exceed the maximum of
EUR 0,05 (some 0,40 NOK) per kWh permissible under the
Authority's State Aid Guidelines, Chapter 15, paragraph 58,
and has proposed to insert this maximum threshold into the
Draft Regulation.

2.3.5. Calculations

submitted by the Norwegian authorities

for
analysis of the aid scheme under the Authority's State Aid
Guidelines

Information submitted for
operating aid for
Authority's State Aid Guidelines

the assessment under option 1 on
renewable energy sources of Chapter 15 the

The Norwegian Government submitted that, due to waste-
to-energy production requiring a considerable investment in
production and cleansing technology, producers of energy
from waste will have to bear environmental costs which they
will not be able to get credit for in the energy market. The
Norwegian authorities
submitted a comparative table on
estimated production costs in the notification:

TABLE 1

Production costs of various energy sources

Energy source

Energy production
costs
(EUR/kWh)

Energy production
costs
(NOK/kWh) (*)

Light oils

Heavy oils

Gas

Waste to energy (100 % energy
utilisation)

Waste to energy (75 % energy
utilisation)

0,052

0,038

0,040

0,420

0,310

0,326

0,045

0,367

0,060

0,489

(*) Exchange rate: 1 EUR = 8,16 NOK, calculated by the Authority.

This information on the production costs is necessary for an
assessment of the aid scheme under option 1 in Chapter 15
regarding operating aid for renewable energy of the Authority's
State Aid Guidelines. However,
the Norwegian Government
had not submitted any market price for the energy concerned,
as required under paragraph 54 of Chapter 15.

that

The Norwegian Government admits
the figures on
production costs in Table 1 contain elements of uncertainty,
and that the numbers on waste-to-energy are based on a high
technology plant. Firstly, as regards the waste-to-energy figures,
the Norwegian Government submits that the production cost is
connected to a certain size of such plants and that alternative
costs related to other energy carriers may vary widely. Other
crucial
the alternative costs are
connected to old or new installations and what prices each
project achieves
the Norwegian
in the market. Secondly,
Government states that the costs related to energy productions
are difficult
to separate from the costs related to waste
treatment as a whole.

factors could be whether

The Norwegian authorities have later submitted data which
compare production costs of heat energy based on waste
with market prices for regular electricity for industry and
households.

TABLE 2

Production costs of waste-based-energy compared with the market price
for electricity

Production cost
Waste based energy
(based on a medium sized plant,
75 % energy utilisation)

NOK 0,45 kWh (*)
containing
(not
treatment cost of waste)

negative

Market price electricity

Industry

Households
including tax
on electricity

NOK 0,176 kWh NOK 0,357 kWh

(*) Table submitted by the Norwegian authorities. The small deviation compared
to the production costs for this type of plant as given in Table 1, results from
the conversion factor.

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Information submitted for
operating aid or renewable energy sources of Chapter 15 of
Authority's State Aid Guidelines

the assessment under option 3 on
the

In its notification, the Norwegian Government first submitted
the following table, demonstrating the environmental costs
associated with various energy carriers. A background calcu-
lation was submitted to the Authority upon request (10).

on such heavy oil. The theoretical environmental costs of the
energy production from heavy oil are calculated on the basis of
how emissions from such production would be taxed if they
were taxed as emissions from waste based production. Thus,
the emissions caused by heavy oil energy production are
multiplied with the tax rates which apply for waste-to-energy
production. As to the parameters used for determining the
emissions, the Norwegian authorities refer to the parameters
used in Directive 2000/76/EC on the incineration of waste.

TABLE 3

External costs of different energy carriers

EUR/kWh

NOK/kWh (*)

Waste to
energy plant

0,0025

0,020

Light oils

Heavy oils

0,0063

0,051

0,024

0,196

(*) Exchange rate: 1 EUR = NOK 8,16, calculated by the Authority.

In order to provide a comparison with the environmental costs
incurred and not paid by energy sources competing with waste,
the Norwegian Government subsequently submitted the three
tables below. It should be noted that the comparison provided
by the Norwegian authorities only concerned heat production
by heavy oil. There is no comparison given between waste-
to-energy production and other energy sources as regards elec-
tricity production. Electricity production by waste is considered
by the Norwegian authorities to be of insignificant amounts
and therefore considered as not relevant, due to competition in
the electricity market.

As to the tables below, Table 4 provides a review of the
emissions caused by a waste-to-energy production plant and
the environmental costs of such production. These costs are
set equal to the payable taxes on emissions according to the tax
rates of the new tax system. The table also provides figures on
emissions from a plant of the same energy production capacity,
but based on heavy oils. The table finally shows a calculation
of theoretical environmental costs by energy production based

taxes

the tax rates of
According to the Norwegian Government,
environmental
to
measure external costs. The Norwegian Government submits
that presently there are three main methods used in the deter-
mination of environmental costs:

the most appropriate manner

is

— damage costs, whereby the physical damage caused by the
emissions is described, and then the value of the damages is
estimated,

— abatement costs, which present marginal costs on actions
to reduce emissions as an indication of what the society is
willing to pay to reduce the emissions. An environmental
tax can be seen as a valuation of marginal reduction in
emissions,

— environmental

indexes, which is a method connected to
estimation of external costs due to emission of hazardous
chemicals.

i.a.

emission of

The Norwegian authorities base themselves on the abatement
cost method. As stated by the Norwegian Government that is
is bound by international environ-
‘due to that Norway,
mental agreements, which lays down several goals on the
substances. Through the
complete
agreements,
negotiation processes
the
its methods of
Norwegian Authorities have
evaluation of damages caused by the various emissions. Thus,
this method also makes the basis of the development of tax
rates in the new proposed tax scheme (Rapport 85/00, Miljø-
kostnader ved avfallbehandling, ECON)’ (11).

led to the
expressed

various

that

(10) That background table is not copied in the Decision, because —
while explaining the details of the calculation of external costs for
waste, heavy and light oil — it is only on heavy oils that the
Norwegian Government also presents a calculation for external
costs paid by the producer.

(11) Letter by the Norwegian authorities of 30.4.2003 (Doc. No

03-2862-A).

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TABLE 4

Tax rates, emissions and environmental costs for energy plants producing 85 GWh of energy based on waste and heavy oil (1)

High technology waste-to-energy plant
85 GWh
35 000 tons combustible waste

Heavy oil
85 GWh
8 900 tons heating oil

Parameter (2)

Tax rates (3)
(NOK/kg)

Actual emissions (4)
kg

Payable
environmental
costs (5)

Actual emissions (6)
kg

Theoretical
environmental
costs (7)

Dioxins

2 350 000 000

0,00

15 980,00

0,00

19 975,00

Dust (PM10)

Hg (mercury)

Cd (cadmium)

Pb (lead)

Cr (chromium)

Cu (copper)

Mn (manganese)

As (arsenic)

Ni (nickel)

HF (hydrogen fluoride)

577

225,00

129 825,00

11 560,00

6 670 120,00

27 600

53 100

63 400

571 000

307

95 000

9 710

9 300

20 400

1,80

0,01

0,02

0,07

0,07

0,07

0,01

0,07

0,70

49 680,00

477,90

1 426,50

38 542,50

20,72

6 412,50

109,72

627,75

0,00

0,20

2,40

0,20

0,70

0,30

0,10

0,00

10 620,00

152 160,00

114 200,00

214,90

28 500,00

971,00

42,50

395 250,00

14 280,00

8,50

173 400,00

HCI (hydrogen chloride)

102

1 057,00

107 865,00

238,00

24 276,00

Nox
dioxide)

(NO2)

(nitrogen

Sox (SO2) (sulphur dioxide)

CO2

Environmental costs NOK

Environmental costs NOK
per kWh

15

17

15 975,00

239 625,00

37 655,00

564 825,00

2 295,00

39 015,00

110 330,00

1 875 610,00

0,2

7 350 000,00

1 470 000,00

24 114 500,00

4 822 900,00

2 113 887,60

14 853 021,90

0,0249

0,1747

(1) The Authority assumes that some inaccuracies in the figures result from a round off effect.
(2) In accordance with Directive 2000/76/EC of the European Parliament and of the Council of 4 December 2000 on the incineration of

waste.

(3) The tax rates are in accordance with the legal act introducing the new tax scheme for the latter half of 2003, except the tax on CO2,

which is based on an evaluation according to the Kyoto Protocol.

(4) Source: Energos miljønotat Nr. 5 June 2000.
(5) Actual payable environmental tax, according to the external costs produced = Tax rates × actual emissions.
(6) Source: Energos miljønotat Nr. 5 June 2000.
(7) Theoretical environmental costs due to the tax rates (external costs) on incineration of waste.

The following calculations (Table 5 and Table 6) show how much of the estimated external costs are paid
by the energy producers who base their production on heavy oil. Firstly the taxes paid by producers from
heavy oil are calculated. For this purpose, the taxes on

— heating oil,

— CO2 and

— sulphur

are taken into account (Table 5).

However, since the Norwegian Government argues that the heating oil tax is not an environmental tax, it
provides two calculations, one including, another excluding, that tax.

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TABLE 5

Taxes on energy plant using heating oil (1)

Tax rates 2003 NOK/litre

Tax on heating oil
converted to NOK/kg

Tax on heating oil = 0,398

Tax on CO2 = 0,50

Tax on sulphur = 0,21

0,410

0,520

0,216

Payable tax

3 649 000

4 583 500

1 922 400

Total

8 873 300

NOK per kWh

0,119

Payable tax, except the tax
on heating oil

4 583 500

1 922 400

5 224 300

0,077

(1) Energy plant using 8 900 tons heating oil for producing 85 GWh of heat energy as stipulated in Table 4. The table has been

submitted by the Norwegian authorities. Some inaccuracies seem to result from a calculation error.

Table 6 compares the theoretical external costs of energy production from heavy oil with the costs actually
paid by the producers. Again, two calculations are presented, depending on whether the heating oil tax is
considered to be relevant for the present assessment.

Heat production from heavy oil: external costs not paid, with and without the tax on heating oil

TABLE 6

Taxes included

Total external
costs (1)

External costs
paid due to the
taxes on oil

External costs not
paid

NOK per kWh

NOK per kWh

CO2, SO2, Heating oil

CO2, SO2

0,175

0,175

0,119

0,077

0,055

0,098

(1) Figure taken from Table 4.

Not taking the heating oil tax into account, the Norwegian
Government argues that an amount of 0,098 NOK per kWh
of external costs is not paid by the non-renewable energy
producers, whereas waste-to-energy producers pay their full
environmental costs via the tax scheme.

As to the energy production from methane from landfills,
Norway stipulates that waste-to-energy producers pay their
full tax. Contrary to the waste incineration tax, this tax is
not emission based, but a differentiated tax at NOK 327 and
427 respectively. No calculation is given as to the external
costs caused by landfills.

the activities of Enova will ensure that the cumulation rules of
the State Aid Guidelines are respected.

2.3.7. Duration/budget

The notified aid scheme is envisaged to enter into force on 1
July 2004. The scheme is not
the
Norwegian Government has agreed to a re-notification within
five years.

limited in time, but

The Norwegian Parliament will decide to continue the scheme
through annual budget allocations. For 2003 Parliament had
originally foreseen NOK 40 million for the latter half of 2003.
NOK 80 million are foreseen on an annual basis.

2.3.6. Cumulation of aid

3. General comment by Norway

Final waste treatment plants might be eligible for investment
aid through the Grant program for introduction of new energy
technologies, which is a programme funded by the Norwegian
Energy Fund and managed by the newly established admini-
strative body Enova. The programme was notified to the EFTA
Surveillance Authority on 10 June 2003 (Doc. No 03-3705-A).
The Norwegian authorities state that the Norwegian Pollution
Control Authority and Enova will coordinate the aid schemes
in accordance with Chapter 15 of the Authority State Aid
Guidelines and that the rules governing the Energy Fund and

the Authority's State Aid Guidelines,

In its notification, the Norwegian authorities argued that the
aid scheme, which grants operating aid for renewable energy
sources, falls within the scope of what should be permitted
under
in particular
Chapter 15 on Environmental Aid. In view of the superior
objectives of
the Norwegian
the Environmental Guidelines,
Government argues that the Authority's State Aid Guidelines
should be interpreted broadly and that option 3 (Chapter 15,
section D.3.3.3) and option 1 (Chapter 15, section D.3.3.1)
may cover the aid scheme.

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The Norwegian Government admits that although various
proposals could fit different options under the Guidelines, the
complete aid scheme did not completely fit any of the three
the rules applicable to operating aid for
options under
the
its
renewable
Authority subsequent to the notification, Norway asked the
Authority to assess the compatibility of the system primarily
under option 3.

correspondence with

resources.

In

II. APPRECIATION

1. Scope of the present decision

The present decision deals with the aid scheme for the utili-
sation of energy from final waste treatment plants that are
required to pay tax on final waste treatment, as notified by
the Norwegian authorities.

2. Procedural requirements

in Part

I of Protocol 3 to the
Pursuant
to Article 1(3)
Surveillance and Court Agreement,
‘the EFTA Surveillance
Authority shall be informed, in sufficient time to enable it to
submit its comments, of any plans to grant or alter aid [. . .].
The State concerned shall not put its proposed measures into
effect until the procedure has resulted in a final decision’.

By submitting the notification for the aid scheme for the utili-
sation of energy from final waste treatment plants that are
required to pay tax on final waste treatment by letter dated
29 January 2003 (Doc. No 03-654-A), the Norwegian auth-
orities have complied with the notification requirement. The
the Norwegian
Authority
Government has respected its obligations pursuant to Article
1(3)
in Part I of Protocol 3 to the Surveillance and Court
Agreement.

can therefore

conclude

that

3. State aid within the meaning of Article 61(1) of the
EEA Agreement

Article 61(1) of the EEA Agreement reads as follows:

‘Save as otherwise provided in this Agreement, any aid granted
by EC Member States, EFTA States or through State resources
in any form whatsoever which distorts or threatens to distort
competition by
the
production of certain goods shall, in so far as it affects trade
between Contracting Parties, be incompatible with the func-
tioning of this Agreement.’

certain undertakings or

favouring

In order for the notified aid scheme to be qualified as State aid
within the meaning of Article 61(1) of the EEA Agreement, the
following criteria must be fulfilled:

3.1. Presence of State resources

The grants are based on State budgetary allocations and
constitute state resources.

3.2. Favouring certain undertakings or the production of

certain goods

The grants to waste incinerations plants and landfills, which are
subject to the waste treatment tax, give these undertakings a
financial advantage which they otherwise would have not
enjoyed. The grants indirectly mitigate — at least in part —

the charges resulting from the payment of the waste treatment
tax.

The support will only favour a limited group of waste incin-
eration plants and landfills (an estimated number of 21 under-
takings), namely those which are paying the final waste
treatment
tax and which provide waste based energy for
collective/district heating and/or electricity to the power grid.

The financial assistance provided to this selective group of
waste-to-energy producers strengthens their position in the
energy market
(for heat and electricity). The undertakings
receiving financial support under the aid scheme will also
enjoy a financial advantage over
those waste incineration
plants and landfills which do not recover and utilise the
waste for energy production.

3.3. Distortion of

competition and effect on trade

between Contracting Parties

The aid beneficiaries exercise an economic activity on energy
and waste treatment markets where there is, or could be, trade
between Contracting Parties. As can be seen from Table 7 of
this decision, energy production from waste competes with
other energy sources, which could be provided by other under-
taking in the EEA. The strengthening of the position of the
relevant undertakings as compared with other undertakings
competing with them within the EEA must
therefore be
regarded as distorting, or threatening to distort, competition
and affecting trade between the Contracting Parties.

3.4. Conclusion

The proposed aid scheme constitutes state aid within the
meaning of Article 61(1) of
In the
following,
the proposed aid
scheme is compatible with Article 61(3) of the EEA Agreement.

it will be analysed whether

the EEA Agreement.

4. Compatibility of the aid scheme with Article 61(3) of
the EEA Agreement in combination with Chapter 15 of
the Authority's State Aid Guidelines on Aid for Environ-
mental Protection

Article 61(3)(c) of the EEA Agreement regards aid to facilitate
the development of certain economic activities, where such aid
trading conditions to an extent
does not adversely affect
the Contracting Parties, as
contrary to the interests of
compatible with the functioning of the EEA Agreement. The
Authority has undertaken an assessment of the compatibility of
the notified aid scheme under Article 61(3)(c) of
the EEA
Agreement,
in line with the Authority's State Aid Guidelines
on Aid for Environmental Protection. The Authority has doubts
whether the proposed aid scheme fulfils the criteria set out in
the relevant Chapter 15 of the Guidelines.

The aid granted by the Norwegian Government constitutes
operating aid, which relieves waste incineration plants and
landfills of the expenses which a company normally would
have had to bear in its day-to-day management or its usual
activities (12). Chapter 15 of
the Authority's State Aid
Guidelines (hereinafter ‘the Guidelines’) sets out specific rules
according to which operating aid for environmental purposes
should be assessed.

(12) For the definition of operating aid, see Case T-459/93 Siemens SA

v. Commission [1995] ECR II, p. 1675.

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Since the Norwegian Government argued that the proposed
scheme should be assessed primarily under Chapter 15, D.
3.3.3 — option 3 — for assessing operating aid,
the
assessment below will commence with this option.

4.1. Compatibility of the aid scheme under Chapter 15,

D.3.3.3 — Option 3

Paragraph 58 of the Guidelines stipulate that ‘EFTA States may
grant operating aid to new plants producing renewable energy
that will be calculated on the basis of
the external costs
avoided’.

4.1.1. Renewable energy

According to paragraph 7 of Chapter 15 the Guidelines in
conjunction with Article 2(a) of Directive 2001/77/EC (13)
renewable energy sources shall mean renewable non-fossil
energy sources, inter alia comprising biomass and landfill gas.
Biomass means the biodegradable fraction of products,
for
waste the biodegradable fraction of industrial and municipal
waste (Article 2(b) of Directive 2001/77/EC). The Norwegian
authorities have argued that the proposed aid scheme is limited
to energy production based on biomass in the meaning of
Directive
the
Norwegian authorities confirmed that every utilisation of
methane gas from land fillings is solely based on the biode-
gradable fraction and will therefore receive the high grant rate
(see point 2.3.4).

2001/77/EC.

(methane)

landfill

For

gas

For waste, two aid rates are established, depending on whether
the application for support is made for waste which is free
from fossil fractions or whether the waste is ‘mixed’. Incin-
eration plants using fossil-free waste get
the full grant,
stipulated presently at NOK 0,10 per kWh. The incineration
plants which use mixed waste receive 60 % of this grant, i.e.
NOK 0,06 per kWh. For establishing this reduced rate,
it is
contains 13 %
assumed that ordinary municipal waste
non-renewable fossil energy material, which constitutes 40 %
of the potential energy contained in the waste. Renewable
materials, which are non-fossil, are consequently supposed to
account
for 60 % potential energy in mixed waste. The
Norwegian authorities argue that while accepting that in an
individual case aid might be given to companies whose waste
than the
contains a higher proportion of
assumed average of 13 % (which are assumed to result
in
40 % of potential energy contained), it would not be possible
to calculate the exact amount
firm.
According to the Norwegian authorities, a company interested
in receiving the high rate, would have all interest to establish
mechanisms to demonstrate that its energy production is based
on waste with a lesser fraction of fossils.

for each individual

fossil material

While the Authority does not, in general, rule out that due to
the difficulties in gathering company data, an average calcu-
lation might be acceptable, the Authority notes that it has not
been given any information, on how the Norwegian Pollution
Control Agency established the percentages 13 % of
fossil
content and 40 % in energy potential. Especially, since the
that
Norwegian Government points out
it does not have
the Authority has no
access to individual company data,
means of assessing on which basis the quoted percentages

(13) Directive 2001/77/EC of

the
Council on the promotion of
from
renewable energy electricity market (OJ L 283, 27.10.2001, p. 33).

the European Parliament and of

electricity produced

have been calculated and what any range of deviation from
this apparent average figure might amount to. It would for
example be of
the highest possible
percentage of fossil material
(i.e. the ‘worst case’ which —
due to the proposed average calculation — would still profit
from the 60 % rate) a waste treatment undertaking would
handle.

to know what

interest

i.e.

in order to ensure that

Such information is important for the Authority's assessment
under the State Aid Guidelines, according to which, aid should
be given only to renewable energy sources,
the biode-
gradable fraction of waste. Support under the Guidelines is
not envisaged for fossil material. The information is further
necessary,
the Norwegian support
scheme does not promote the incineration of non-separated
municipal waste,
if such promotion undermines the waste
treatment hierarchy, as stipulated in recital 8 of Directive
2001/77/EC in combination with Articles 3 and 4 of
Directive 75/442/EEC (14). The Authority notes that there are
no general restrictions concerning the amount of plastics in the
waste in place, so that it must be ensured that the granting of
aid does not
lead to wrong incentives which provoke a
lessening of recycling. While not excluding that the tax on
waste incineration might favour recycling at the expense of
incineration, and that the aid scheme favours the utilisation
of waste at the expense of landfills in line with the waste
hierarchy, the Authority is still concerned that, by allowing a
possibly too generous rate of 60 % for mixed wastes containing
incentives for plants to separate
fossil elements, the general
waste for recycling purposes are reduced. Since it appears
that waste incineration resulting in energy utilisation cannot
automatically be regarded as a recovery operation rather than
a disposal operation (15), the Authority is concerned that a too
generous low grant rate would support waste incineration to
the detriment of separating and recycling waste.

The Authority is not yet convinced that a lower grant rate
(based e.g. on the worst case scenario) than the notified low
grant rate, would jeopardize the efficiency of the aid system.

4.1.2. The calculation of external costs avoided

According to paragraph 58 of Chapter 15 of the Guidelines,
aid may be granted on the basis of external costs avoided.
According to the Guidelines,

‘[external costs] . . . are the environmental costs that society
the same amount of energy were
would have to bear if
produced by a production plant operating with conventional
forms of energy. They will be calculated on the basis of the
difference between, on the one hand,
the external costs
produced and not paid by renewable energy producers and,
on the other hand, the external costs produced and not paid
by non-renewable energy producers. To carry out these calcu-
lations, the EFTA State will have to use a method of calculation
that is internationally recognised and has been communicated
to the Authority. It will have to provide among other things a

(14) Directive 75/442/EEC (OJ L 194, 25.7.1975, p. 39), incorporated

into Annex XX, point 27 of the EEA Agreement.

(15) Judgement of the European Court of Justice of 13 February 2003,
Case C-458/00 Commission v. Luxembourg [2003] ECR I-1553,
paragraph 31 seq. See also COM(2003) 301 final, where it is
expressed that while e.g. landfill taxes are an incentive to change
waste management choices, these taxes must be complemented by
other instruments so as to avoid diverting mixed waste in bulk
towards incineration.

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reasoned and quantified comparative cost analysis, together
with an assessment of competing energy producers' external
costs, so as to demonstrate that
the aid does genuinely
compensate for external costs not covered. At any event, the
the aid thus granted to the renewable-energy
amount of
producer must not exceed EUR 0,05 per kWh . . .’

(3) The Authority cannot exclude a risk of overcompensation
for heat production. As stated above (see calculation under
point
foresees an
annual budget of NOK 80 million in support of waste
incineration plants.

the Norwegian Government

I, 2.3.4),

In their notification, the Norwegian authorities submitted a
table which compared the external costs of waste-to-energy
production with light oil and heavy oils (see Table 3 above).
In further correspondence with the Authority, a more detailed
comparison was only submitted with regard to heavy oils (see
Table 4, above point I, 2.3.5).

The Authority finds, that — following the comparison with
heavy oils (see above Table 6 at point I, 2.3.5) — if the
external costs avoided were to be quantified at NOK 0,55
per kWh,
the budgetary allowance should not exceed
NOK 45,65 million (18). This includes the payment of the
heating oil tax by energy production based on heavy oil.

The Authority has the following doubts as to whether the
calculation of external costs on that basis can be considered
sufficient under paragraph 58 of Chapter 15 of the Guidelines,
and as to whether the calculation demonstrates that the aid is a
genuine compensation for external costs not covered.

(1) The Norwegian authorities have not explained why the
original comparison with light oils was omitted for the
purpose of calculating the external costs avoided. The
Norwegian authorities have simply stated that waste-
to-energy plants will, to a large extent, substitute oil, but
have not explained why their comparative cost analysis (16)
does not extend to light oils. Furthermore, the Authority
cannot exclude that there are other competing sources for
heat production (district and collective heat), e.g. electricity,
for which no comparative data have been supplied or
explained why they are not relevant (see also below).

(2) For district heating — not for collective heating — the
Norwegian authorities have submitted an overview of
different energy carriers (17), which shows that also bio
energy, heat pumps, oil, gas and in particular electricity
are used for heat production. However,
the Norwegian
Government has not provided any comparative data for
these other energy carriers, so that it is not possible for
the Authority to make an assessment of the external costs
In particular it
avoided under the State Aid Guidelines.
appears
the more
least
relevant comparison would have been the production of
heat by
substitute
according to the table below.

electricity which is

for district heating,

that, at

closest

the

TABLE 7

Energy sources used for district heating

Coal

Waste

Waste heat (surplus heat)

Bio energy

Heat pump

Oil

Electricity

Gas

0,04 TWh

0,82 TWh

0,16 TWh

0,16 TWh

0,16 TWh

0,16 TWh

0,52 TWh

0,04 TWh

(16) Corresponds to Table 3, Comparative cost analysis in the letter of
the Norwegian authorities dated 30.4.2003 (Doc. No 03-2862-A).
(17) Table 1 in the letter of the Norwegian Government of 6.10.2003.

(4) The Norwegian Government argues, however,

that

the
heating oil tax should not be taken into account for calcu-
lating the amount of external costs paid. The Authority is
tax should not be
the heating oil
not convinced that
regarded as an environmental tax and therefore not be
taken into account when calculating the external costs
paid by producers of heat using heavy oils as a source.
The Norwegian Government has
the
heating oil tax was introduced to avoid substitution of
the use of electricity by the use of heating oil. However,
since the introduction of
the electricity tax aims at
decreasing consumption for environmental purposes (19),
the corresponding rise of
tax likewise
follows an environmental purpose, namely preventing
that the environmental aim of the electricity tax being
jeopardized, due to a switch to heating oil.

the heating oil

explained that

Even if this was considered as an indirect environmental
effect, in the Authority's preliminary view, this is sufficient
to classify the tax as ‘environmental’ under the Guidelines
(Paragraph 7), which stipulate that ‘one likely feature for a
levy to be considered as environmental would be that the
taxable base of the levy has a clear negative effect on the
environment. However, a levy could also be regarded as
environmental
it has a less clear, but nevertheless
discernable, positive effect’. The Norwegian Government
had itself argued that the heating oil tax was introduced
to ‘prevent an environmental unfortunate increase in the
use of oil for heating purposes’ (20).

if

(5) The Authority further notes that the calculation of external
costs and consequently the level of taxation is based on
high technology waste-to-energy plants. However, as the
Norwegian Government states, the existing waste incin-
low technology plants with
eration plants also cover
presumably higher emission levels. While the Authority
could possibly accept
that due to stringent regulatory
demands,
in the future low technology plants will close
down and should not be used as a reference factor for
the future, the Authority also notes that the Norwegian
Government has stressed that,
the
scheme is aimed at existing (at the moment 21 identified)
waste incineration plants, see also below 4.1.4.

for the time being,

(18) 1 300 000 000 kWh × 0,60 × NOK 0,055 + 50 000 000 kWh

× 0,055 = 45 650 000 NOK.

(19) See Str.prp. nr. 1, 1999-2000, point 3.8 avgift på elektrisk kraft.
(20) Letter by the Norwegian Government of 30.4.2003 (Doc. No

03-2862-A).

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existing plants

The Authority has not received information on how many
of
low technology plants.
are
the
Consequently,
the Authority cannot be sure that an
external cost calculation based solely on high technology
plants is the correct basis for approving aid under the
Authority's State Aid Guidelines. To the extent that waste
incineration plants cause more pollution and consequently
bring about higher environmental costs than they are
charged in taxes, the external costs avoided through such
plants will be reduced compared to conventional energy
production.

(6) The Authority also notes

that as

to waste-to-energy
production for the purposes of electricity, the Norwegian
Government has not submitted a calculation comparing the
external costs produced and paid by renewable energy
producers and producers producing energy from traditional
energy sources. The Norwegian Government stated that in
2001, heat production from waste amounted to 0,9 TWh,
while electricity production based on waste constituted
0,05 TWh implying that heat energy constituted about
95 % of all the waste based energy production. However,
the envisaged aid scheme mainly
while it
the fact cannot be neglected
concerns heat production,
that, with regard to electricity production, the aid scheme
has an effect on competition in the electricity market. In
that respect, Norway has not submitted any data which
would make it possible for the Authority to assess the
external costs. Neither has it received sufficient information
on the competitive situation in the electricity market.

is true that

tax on landfills

the landfills pay their

(7) The Authority notes in particular, that no calculation has
been presented for landfills. The Norwegian Government
full external costs
that
argues
through the
respectively
NOK 427). However, the Authority notes that the calcu-
lation of the tax is not based on emissions and that the low
tax rate is the same as the one which was applied in 1999
when the tax was first introduced. The Authority does not
have sufficient information on whether the calculation of
the landfill tax rate at the time was based on environmental
impacts, which are still valid today.

(NOK 327,

4.1.3. Internationally recognised method

The Authority notes that only with regard to heavy oils has a
more detailed and reasoned calculation been submitted (see
I, 2.3.5), whereas comparisons with
Table 4 under point
other competing energy sources for heat production and
figures regarding the use of waste for electricity production
have not been submitted.
the
It
comparison between waste-to-energy and heavy oils for heat
production that the Authority is able to assess whether the
calculation submitted by the Norwegian authorities is based
on an internationally recognised method.

therefore only for

is

The Norwegian authorities have explained (see above point I,
2.3.5) that there are three methods regarding the calculation of
external costs: damage costs, abatement costs and environ-
mental indexes. The method primarily used for the calculation
is
the abatement cost method, which according to the
Norwegian authorities and with references to international
costs on
environmental
actions to reduce emissions as an indication of what
the
society is willing to pay to reduce the costs. The Norwegian
authorities see environmental taxes as a valuation of marginal
reduction in emissions. However, for the following reasons, the

calculate marginal

agreements,

Authority has doubts as to whether the calculation can be
accepted as being based on an internationally recognised
method.

the

the

stipulates,

calculation. As

(1) Firstly, the Authority notes that the abatement method has
the
not been used throughout
Norwegian Government
valuation of
various gases are ‘mostly’ based on the abatement cost
analysis. The Authority can therefore not assess, whether
the method is deviated from for certain emissions. The
estimate on dust is based on valuation of health damage
and the valuations of hazardous substances are bases on
indexes that rank these substances according to damage
potential.
the calculation of
is based rather on a combination of
external costs
methods than the abatement costs method alone. The
Authority does not have sufficient information to assess,
and presently doubts, whether this combination is a correct
basis for calculating external costs under the Guidelines.

therefore appears

that

It

(2) Secondly, Norway has not yet

substantiated that

this
method (or combination of methods as described above)
is internationally accepted. Norway has stated that
the
figures presented in the evaluation of external costs are
based on methods used within basic research in Norway
which are not different from the internationally approved
methods used in other countries. No proof has been given
to show that the methods used by Norway are in line with
international standards — the report 1999/32 by Norway
Statistics has not been submitted to the Authority (Frem-
skrivning av avfallsmengder og miljøbelastninger til sluttbe-
handling av avfall).

by

it
international

is bound to use the
Norway further has stated that
abatement method
environmental
agreements, and that through the negotiation process that
the Norwegian authorities have
led to the agreements,
expressed
damages.
of
However, from the ‘expression of methods’ the Authority
cannot conclude that
the methods are indeed inter-
nationally accepted. The report 85/00 Miljøkostnader ved
avfallsbehandling, ECON, has not been submitted to the
Authority.

its methods

evaluation

of

The Authority further notes that the 2001 external costs
study undertaken by the European Commission ‘ExternE’
concerning environmental costs of electricity production
(bottom-up) method,
was based on the damage cost
which also included waste incineration. That
research
project was undertaken in 20 sub-research projects over
10 years and has developed a methodology — the
impact pathway
the
emissions and dispersions and assesses the impact of
these emissions (e.g. on health, marine life, etc.) (21). The
ExternE cost methods expresses
some reservations as
regards so-called cost control or abatement method (22).

approach — which measures

(21) Press release 20 July 2001, IP/01/1047. The project is continued with
a follow-up project, NewEXT, see publication of 7.11.2002 on
http://europa.eu.int/comm/research/news-centre/en/env/02-10-
env02.html

(22) http://externe.jrc.es/Method+Approaches.htm. ExternE comments
on the cost-control method as follows:
‘the method is entirely
self-referencing — if the theory was correct, whatever level of
pollution abatement
the
economic optimum. Although knowledge of control costs is an
important
regulations,
presenting them as if they were damage costs is to be avoided’.

is agreed would by definition equal

formulating prescriptive

element

in

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In the absence of precedents in case practice, the Authority
therefore cannot — without further investigation — assess
whether for the purpose of calculating aid, the abatement
cost methods is appropriate.

4.1.4. New plants

According to paragraph 58 of
the Authority's State Aid
Guidelines operating aid should only be given to new plants.
Even if the notion of ‘new plants’ could possibly be read to
cover ‘new investments’, the Authority is not entirely certain
whether and to what extent,
the simple continuation of
support to waste incineration qualifies under that system. In
this regard, the Authority notes that it is still unclear which
objectives the scheme intends to follow and in which respect
the aid scheme is a means to achieve them. Norway argues that
the aid scheme should bring about an increase of waste-
to-energy production of 300 GWh annually and a total
increase by 2 TWh by 2010. At the same time Norway is
arguing that the support is necessary to avoid a decrease in
production resulting from the repeal of the tax reductions.
While the Authority takes note of Norway's reasoning that
there is still capacity for increased productions in the existing
plants, for accepting an incentive effect, it needs to understand
how this increased production would be possible if the amount
of support has the same magnitude as the advantage the under-
takings enjoyed under the current tax differentiation scheme.
Whether a support scheme which simply aims at avoiding a
decrease in production due to a change in the tax system, can
qualify under paragraph 58 of Chapter 15 of the State Aid
Guidelines, needs
to be assessed further. The Authority
therefore still has doubts whether aid to existing plants under
option 3 can be accepted.

4.1.5. Re-investment

the Authority's State Aid
According to paragraph 58 of
Guidelines,
the amount of aid granted to producers that
exceeds the amount of aid resulting from option 1 must be
reinvested by the firms in renewable sources of energy. This
requirement applies to any operating aid below EUR 0,05 per
kWh which is otherwise permissible. In this respect, it should
be borne in mind that operating aid for renewable energy
under option 1 is only allowed for plant depreciation.
In
order to avoid overcompensation,
the Guidelines require a
re-investment of that amount of aid authorised under option 3.

The Authority takes into account the argument of Norway that
the level of aid is well below the threshold of EUR 0,05 per
kWh, as stipulated in the Guidelines, and that the aid — as
stipulated in the Norwegian draft regulation — will not exceed
the permissible amount of aid under option 1. A reinvestment
clause is therefore not considered to be necessary by the
Norwegian authorities.

the requirement not

the Authority notes that

to
However,
exceed the threshold of EUR 0,05 per kWh is independent
from the requirement to avoid overcompensation. According
to the Guidelines, every payment which exceeds the amount of
aid resulting from option 1 must be reinvested, regardless
the threshold of EUR 0,05 per kWh is met, or
whether
whether the aid stays below that
threshold. The Authority
has not received sufficient information on the fulfilment of
the criteria of option 1. The Authority has doubts as to the
compatibility of the aid in this respect.

if the Authority were to allow aid to existing
In particular,
plants under option 3,
it needs to be certain that the plant
depreciation, which should not be exceeded, takes into account
that, for existing plants, some of the investment might already
have been depreciated. In that regard, only the part which has
not yet been depreciated should be taken into account.

Conclusion: The Authority presently has doubts — based on the
the proposed aid scheme is
given information — that
compatible with option 3 on operating aid for renewable
energy sources in Chapter 15, D. 3.3.3 of the Guidelines.

4.2. Compatibility of the aid scheme under Chapter 15,

D.3.3.1 — Option 1

Because of the doubts regarding the compatibility with option
3 of Chapter 15, D.3.3.3 of the Guidelines, the Authority has
also carried out an assessment of the compatibility of the
scheme under option 1 on operating aid for
renewable
energies in Chapter 15, D.3.3.1 of the Guidelines.

According to paragraph 54 of Chapter 15 of the Guidelines,
‘EFTA States may grant aid to compensate for the difference
between the production cost of renewable energy and the
market price of the form of power concerned. Any operating
aid may then be granted only for plant depreciation. Any
further energy produced by the plant will not qualify for any
assistance. However, the aid may also cover a fair return on
capital if EFTA States can show that this is indispensable given
the poor competitiveness of certain renewable energy sources.
In determining the amount of operating aid, account should
also be taken of any investment aid granted to the firm in
question in respect of
the new plant. When notifying aid
schemes to the Authority, EFTA States must state the precise
support mechanisms and in particular the methods of calcu-
lating the amount of aid.
the Authority authorises the
If
scheme, the EFTA State must then apply those mechanisms
and methods of calculation when it comes to granting aid to
firms’.

According to paragraph 55 of the Guidelines, operating aid
might be given to biomass if
the
aggregate costs borne by firms after plant depreciation are
still higher than the market price.

the State shows that

In its original notification, the Norwegian authorities submitted
the abovementioned Table 1 to show the different productions
costs of various energy sources. However, since no market
price was delivered to the Authority, an assessment under
option 1 in Chapter 15 was not possible. Despite detailed
questions in the Authority's letter of 3 March 2003 (Doc. No
03-682-D), the Norwegian authorities did not submit sufficient
information — in particular not market prices — to make such
an assessment possible (23). The Authority was
therefore
requested to assess
the
the system under option 3 of
Guidelines.
submission of 6.10.2003 (Doc. No
In its
03-6911-A), the Norwegian authorities then confirmed that
they would respect the requirements of option 1 (aid only

(23) Letter by the Norwegian authorities dated 30.4.2003 (Doc. No

03-2862-A).

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given for plant depreciation, fair return on capital necessary
because of the poor competitiveness etc.). The Norwegian auth-
orities also submitted data on the price of regular electricity for
households and industry in Table 2, referring to Commission
Decision N 239/2001, arguing that this Decision demonstrates
that this comparison is appropriate and sufficient to accept the
compatibility of aid under option 1. However, the Authority
notes that this information and argumentation is given in the
context of assessing option 3. The Norwegian authorities did
not confirm that they would calculate aid on the basis of the
difference between market price and depreciation costs as
required by option 1. The Norwegian Government has
consequently only suggested amending the Draft Regulation
in order to incorporate the necessity of not exceeding plant
depreciation and including a fair return on capital. The very
principle of option 1 is not integrated into the Draft Regu-
lation.

(1) However, even with the figures presented in Table 2, the
to the compatibility of
the
Authority has doubts as
measure under option 1,
in particular since it has not
been provided with a cost calculation method as required
by paragraph 54 of the Guidelines. Firstly, the Authority
notes that the production costs of landfills are missing. As
to the production costs of waste incineration plants, the
Authority notes that it still has not received any detailed
and precise cost calculation method. Details on cost
savings, as well as on the depreciation rate and time
have not yet been given. The Authority can further not
the potential 21 beneficiaries are
assess how many of
medium-sized,
large or small waste incineration plants
and whether the production costs of medium-sized plants
are representative. With regard to plant depreciation, the
Authority would in particular have to assess to which
extent
investments already have been depreciated. This
results from the fact that the aid is given to 21 existing
undertakings and that it is not clear to the Authority to
which degree the envisaged aid mechanism is favouring an
increase of renewable energy production or mainly aiming
at maintaining the favourable conditions resulting from the
existing system of tax differentiation. The Authority notes
that in the Dutch case to which the Norwegian authorities
submitted to the
information was
have referred,
European Commission (24). With regard to the quoted
market price for energy, the Authority notes that it has
not
received any information from which source the
market price stems and where future market prices will
be taken from.

this

(2) The Norwegian Government

that

states

further

the
production costs in paragraph 51 in Chapter 15 of the
societal production
Guidelines must be interpreted as
costs. In line with Commission practice (25), the Authority
does not agree with this view, which also makes the
the
distinction between option 1 and option 3 of
Guidelines
the
statement,
redundant. Based on that
Authority presently has doubt that the Norwegian auth-
the notion of production costs
orities would interpret
within the meaning of
the State Aid Guidelines, when
calculating aid.

(24) Also in other Commission cases, to which the Authority has drawn
Norway's attention in its information request of 30 March 2003,
detailed information has been submitted by the notifying EU
Member State (N 651/01, N 278/01 and in particular N 707/02).

(25) See e.g. cases referred to in footnote 37.

(3) Furthermore,

is difficult

the Authority cannot be certain that

the
calculation of the production costs will only cover that
part directly related to the production of energy and
leave those costs which result
from the treatment of
waste aside. The Norwegian Government has stated that
it
to separate the costs related to energy
production from the costs of waste treatment as a whole.
In the Norwegian authorities' view, if special costs related
to waste collection, sorting and treatment are left out, there
the price of
remains a question of how to adjust
waste-based fuel for the pre-processing that is inherent in
most waste incineration process. While the Authority takes
it also points out that it must
note of these difficulties,
ensure that
support activities and
mitigate the related costs, which the undertakings have to
bear according to obligations resulting from regulatory
national and European law (i.e. Directive 2001/77/EC and
Directive 75/442/EC). The Authority notes that in its latest
the
submission the Norwegian authorities
production costs do not
include ‘negative treatment of
waste’. However, the Authority is not certain what this
statement
implies and would also — on the basis of
former statements by the Norwegian authorities which
argued that it was impossible to separate waste treatment
costs from the costs of waste-to-energy production —
require a detailed analysis and calculation of
the cost
items under the heading ‘production costs’.

the aid does not

state

that

Conclusion: The Authority presently has doubts — on the basis
of the given information — that the proposed aid scheme is
compatible with option 1 on operating aid for renewable
energies in Chapter 15, D. 3.3.1 of the Guidelines.

4.3. Other provisions

The Norwegian authorities have questioned whether paragraph
63 of the Guidelines could serve as a legal basis for approving
aid. Paragraph 63 of the Guidelines merely stipulates that ‘The
Kyoto Protocol calls for a limitation or reduction in greenhouse
gas emissions during the period 2008-2012. The Authority
takes the view that some of the means adopted to comply
with the objectives of the Protocol could constitute State aid
but it is still too early to lay down the conditions for auth-
orising any such aid’, but does not contain a legal basis for
authorising aid. In addition, paragraph 63 addresses flexible
the Kyoto Protocol, such as emission
mechanisms under
quota trading, and does not cover grant schemes like the one
notified.

issue is not degressive and therefore also not
The aid at
compatible according to paragraphs 37 and 40 of Chapter
15 of the Authority's State Aid Guidelines. Paragraph 40 in
conjunction with paragraph 37 of the Guidelines provides that
operating aid for the promotion of waste management is ‘. . .
subject to a limited duration of five years where the aid is
‘degressive’. Its intensity may amount to 100 % of the extra
costs in the first year but must have fallen in a linear
fashion to zero by the end of the fifth year’. The Authority
does not have sufficient information to assess whether the aid
would be compatible under paragraph 37 in combination with
paragraph 41 of the State Aid Guidelines. The Authority does
not have any information on the extra production costs, the
aid being in line with the waste hierarchy and respecting the
aid intensity of 50 %.

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HAS ADOPTED THIS DECISION:

1. The Authority opens the formal

investigation procedure
pursuant to Article 1(2)
in Part I of Protocol 3 to the
Surveillance and Court Agreement against the aid scheme
to utilise energy from final waste treatment plants.

2. The Norwegian Government is invited, pursuant to Article
6(1) in Part II of Protocol 3 to the Surveillance and Court
Agreement, to submit its comments to the present decision
within six weeks from receipt of the present decision.

4. Other EFTA States, EC Member States and interested parties
shall be informed by the publishing of this decision in the
EEA Section of the Official Journal of the European Union
and the EEA Supplement thereto, inviting them to submit
comments within one month from the date of publication.

5. The decision is authentic in the English language.

Done at Brussels, 11 December 2003.

3. The Norwegian Government

is requested to submit all
information necessary to enable the Authority to examine
the compatibility of the proposed State aid under Article
61(3)(c) of
in combination with
Chapter 15 of the Authority's State Aid Guidelines on Aid
for Environmental Protection, within six weeks from receipt
of the present decision. Otherwise the Authority will adopt
a decision on the basis of the information in its possession.

the EEA Agreement,

For the EFTA Surveillance Authority

Einar M. Bull

President

Hannes Hafstein

College Member’