State aid: Commission approves German renewable energy law (EEG 2014) for railway sector

The European Commission has found that a German scheme promoting electricity production from renewable energy sources and benefitting railway companies is in line with EU state aid rules. The Commission concluded that the aid is limited to compensating railway companies for the opportunity costs that arise from using rail transport rather than a more polluting mode of transport, and therefore furthers common transport objectives without unduly distorting competition in the Single Market.

The German Renewable Energy Act (Erneuerbare-Energien-Gesetz – EEG) 2014 provides support for electricity production from renewable energy sources and from mine gas. This support is financed by contributions levied on electricity consumers (the "EEG-surcharge"). The EEG 2014 grants certain energy-intensive users, including railway companies, reductions from the EEG-surcharge. These reductions constitute state aid because they give their beneficiaries an economic advantage over other companies who have to pay the full surcharge. 

The Commission verifies whether such aid is in line with EU state aid rules that allow granting aid to further certain objectives of common interest. The Commission assessed the EEG 2014 on the basis of the new Environmental and Energy Aid Guidelines, and approved it in July 2014. The EEG 2014 entered into force on 1 August 2014. However, specific state aid rules are in force for the railway sector. Therefore, the EEG-surcharge reductions for those companies had to be assessed separately under the provisions of the 2008 Railway Guidelines.

read full article at European Commission