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EU Competition Law, Renewable Energies and the Tendering Model: Quantity Control Versus Price Control in Climate Politics

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New Developments in Competition Law and Economics

Part of the book series: Economic Analysis of Law in European Legal Scholarship ((EALELS,volume 7))

Abstract

State aid law is a key element of EU competition law. It is currently the subject of a heated debate in the wake of the energy transition. The focus is particularly on support systems for renewable energies and on the EU Commission’s attempt to force the member states to make a consistent transition towards the tendering model. However, the idea that the tendering system is particularly competitive and cost-saving proves to be poorly documented. Under EU state aid law, it is also difficult to derive an obligation to a specific support system. Furthermore, various indirect subsidies in favour of fossil fuels are far more problematic in terms of state aid law. Overall, the discussion about the call for tenders can also be read as a continuation of the controversy over quantity control versus price control in energy policy—in which the former is slightly superior, but primarily if it is used to phase out fossil fuels (in a timely manner and in all sectors). Obligations under international climate law also point in this direction.

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Notes

  1. 1.

    Ekardt et al. (2009); Ekardt (2019), ch. 4.2.

  2. 2.

    European Commission: Community Guidelines On State Aid For Environmental Protection, Official Journal of the EU 2008 C 82/1, p. 1, No. 6; also Scheel (2009), pp. 529 et seq. See also communication COM (2014) 2322 on the “generally” passed version of this guidelines on state aid as well as Zeit (2014).

  3. 3.

    See Koenig (1996), p. 943; Ekardt (2016), § 7 D.

  4. 4.

    More on the methodology Ekardt (2019), ch. 1.6–1.7.

  5. 5.

    IPCC (2014); for an overview see Ekardt (2019), ch. 1.2.

  6. 6.

    IPCC (2014) and OECD (2015).

  7. 7.

    Critically Becker and Richter (2015), pp. 3 et seq.; Hennig (2017); Ekardt (2019); Moreno et al. (2015), pp. 13 et seq.

  8. 8.

    With further references Ekardt (2019): ch. 1.2; Becker and Richter (2015); Ekardt et al. (2018).

  9. 9.

    On the design of tendering models e.g. Kahles et al. (2014), pp. 21 et seq.; Grashof (2014), pp. 28 et seq.; Frenz (2014), pp. 231 et seq.; critical Maly et al. (2014), pp. 147 et seq.; Ekardt, in: Frenz et al. (2017), No. 33–34; Hennig (2017), pp. 366 et seq.

  10. 10.

    Generally, on lessons learned with tenders in Germany German Wind Energy Association: Ausschreibungen. www.wind-energie.de/en/node/4412 (13.5.2018); Ringel et al. (2016), passim.

  11. 11.

    For more see Buhofer (2017).

  12. 12.

    Höhne et al. (2016); likewise Rahmstorf (2017), Ekardt et al. (2015b) and Rogelj et al. (2016).

  13. 13.

    See also Peters (2017).

  14. 14.

    Summarised by Rahmstorf (2017), Peters (2017), Figueres et al. (2017) and Rogelj et al. (2017); further more recent views in Schellnhuber et al. (2016), Rahmstorf and Levermann (2017), Berger et al. (2016), Canadell and Quéré (2017), Anderson and Broderick (2017) and Steininger and Meyer (2017).

  15. 15.

    See Ekardt (2014), pp. 317 et seq.; Hennig (2017).

  16. 16.

    More on this Ekardt and Schmeichel (2009b), pp. 171 (179 et seq. and 204).

  17. 17.

    Directive 2001/77/EC of the European Parliament and of the Council of 27 September 2001 on the promotion of electricity produced from renewable energy sources in the internal electricity market.

  18. 18.

    Directive 2009/28/EC of the European Parliament and of the Council of 23 April 2009 on the promotion of the use of energy from renewable sources and amending and subsequently repealing Directives 2001/77/EC and 2003/30/EC. See also Introduction No. 29, pp. 48 et seq. as well as the Introduction European Law.

  19. 19.

    See Rusche (2007), p. 143; Ekardt and Schmeichel (2009b), pp. 171 (179 et seq.).

  20. 20.

    On the dimensions in the meaning of “public”—and critically in the term public interest respectively common good—Ekardt (2010), § 1 E.; Ekardt (2016), § 4 F. I.

  21. 21.

    This is according to the settled case law since the judgment of the ECJ of 12 Oct 1993, Case C-37/92, Vanacker and Lesage[1993] ECR I-4947 para. 19; judgment of the ECJ of 7 May 1998, Joined Cases C-52/97 and C-54/97 Epifanio Viscido, Mauro Scandella and others, and Massimiliano Terragnolo and others v Ente Poste Italiane [1998] ECR I-2629 para. 14 et seq.); Ekardt and Schmeichel (2009b), pp. 171 (207).

  22. 22.

    See Ehricke (2007), Art. 87 EG, No. 63.

  23. 23.

    Judgment of the ECJ of 13 Mar 2001, Case C-379/98, PreussenElektra AG v Schleswag AG [2001] ECR I-2099 para. 58; see also judgment of the ECJ of 24 Jan 1978, Case 82/77, Openbaar Ministerie (Public Prosecutor) of the Kingdom of the v van Tiggele [1978] ECR 25 para. 24–25; judgment of the ECJ of 30 Nov 1993, Case C-189/91, Kirsammer-Hack v Sidal [1993] ECR I-6185 para. 16; judgment of the ECJ of 17 Jun 1999, Case C-295/97 (Piaggio v Ifitalia and others [1999] ECR I-3735 para. 35. Ehrke (2002), p. 677.

  24. 24.

    Judgment of the ECJ of 13 Mar 2001, Case C-379/98, PreussenElektra AG v Schleswag AG [2001] ECR I-2099 para. 59; judgment of the ECJ of 13 Oct 1982 Joined Cases 213/81 to 215/81 Norddeutsches Vieh- und Fleischkontor Herbert Will, Trawako, Transit-Warenhandels-Kontor GmbH & Co., and Gedelfi, Großeinkauf GmbH & Co. v Bundesanstalt für landwirtschaftliche Marktordnung [1982] ECR 3583 para. 22.

  25. 25.

    Judgment of the ECJ of 13 Mar 2001, Case C-379/98, PreussenElektra AG v Schleswag AG [2001] ECR I-2099 para. 58–62.

  26. 26.

    Kirchhof (2001), pp. 117 et seq.; Heller (2001), pp. 191 (192–193).

  27. 27.

    EU Commission Memo of 5 Nov 2013, MEMO/13/948 and IP/13/1021 Press Release on Guidance for state intervention in electricity; judgment of the ECJ of 19 Dec 2013, Case C-262/12 Association Vent De Colère! Fédération nationale and Others v Ministre de l’Écologie, du Développement durable, des Transports et du Logement and Ministre de l’Économie, des Finances et de l’Industrie [2013] ECR 851; Opinion ECR 469 para. 23, 28, 58 and 70.

  28. 28.

    Judgement of the Commission of 2 Mar 2005, Aid No. NN 80/2004 (turns into C 7/2005), Official Journal of the EU 2005 C 63/2 et seq. On the discussion about Austrian subsidy for renewable energies Ekardt and Steffenhagen (2011), pp. 319 et seq.

  29. 29.

    Judgment of the ECJ of 2 Aug 1993, Case C-266/91, Cellulose Beira Industrial Sa v Fazenda Pública, [1993] ECR I-4337, para. 2.

  30. 30.

    Judgment of the ECJ of 1 July 2014, Case C-573/12, Aland [2014].

  31. 31.

    On the following already Ekardt et al. (2009), pp. 319 et seq.

  32. 32.

    Judgment of the ECJ of 17 Mar 1993, Case C-72/91, Sloman Neptun v Bodo Ziesemer [1993] ECR I-887 et seq.; see also Soltész (1998), p. 747.

  33. 33.

    Judgment of the ECJ of 16 May 2000, Case C-83/98, French Republic v Ladbroke Racing Ltd and Commission of the European Communities [2000] ECR I-3271, para. 50.

  34. 34.

    Judgment of the ECJ of 25 Jun 1970, Case 47/69 French Republic v Commission of the European Communities [1970] ECR 487; judgment of the ECJ of 2 Jul 1974, Case 173/73 Italian Republic v Commission [1974] ECR 709—Family allowances in the textile industry; judgment of the ECJ of 22 Mar 1977, Case. 78/76 Steinike and Weinlig v Germany [1977] ECR 595; judgement of the ECJ of 11 Nov 1987, Case 259/85 French Republic v Commission of the European Communities [1987] ECR 4393—State aid—Textile and clothing sector; see also furthermore judgement of the ECJ of 16 Dec 1992, Case C-114/91 Criminal proceedings against G. J. Claeys [1992] ECR I-6566; judgement of the Commission of 30 Mar 1989 ruling on a financial measure taken by the Federal Republic of Germany in respect of the coal industry during 1988 and a supplementary financial measure in respect of the coal industry during 1987, Official Journal of the EC [1989] L 116/52 et seq.

  35. 35.

    Judgement of the ECJ of 22 Mar 1977, Case 78/76 Steinike and Weinlig v Germany [1977] ECR 595, para. 4–6.

  36. 36.

    Judgement of the ECJ of 13 Jan 2005, Case C-174/02 Streekgewest Westelijk Noord-Brabant v Staatssecretaris van Financiën [2005] ECR I-85, para. 26, referencing Judgment of the ECJ of 25 Jun 1970, Case 47/69 Government of the French Republic v Commission of the European Communities [1970] ECR 487, para. 17, 20–21.

  37. 37.

    Streekgewest Westelijk Noord-Brabant v Staatssecretaris van Financiën [2005] ECR I-85, para. 26, referencing Judgment of the ECJ of 25 Jun 1970, Case 47/69 Government of the French Republic v Commission of the European Communities [1970] ECR 487, para. 17, 20–21.; Ekardt and Schmeichel (2009b), p. 171.

  38. 38.

    Judgment of the ECJ of 20 Nov 2003, Case C-126/01 Ministre de l’Économie, des Finances et de l’Industrie v GEMO SA [2003] ECR I-13769 et seq.; judgment of the ECJ of 2 Aug 1993, Case C-266/91, Cellulose Beira Industrial Sa v Fazenda Pública, [1993] ECR I-4337, para. 2.; judgment of the ECJ of 27 Oct 1993, Case C-72/92 Scharbatke v Germany [1993] ECR I-5509; judgment of the ECJ of 21 Nov 1991, Case C-354/90 FNCE v France [1991] ECR I-5505; judgement of the ECJ of 22 Mar 1977, Case 78/76 Steinike and Weinlig [1977] ECR 595, para. 4–6. The parafiscal institutions are bound by the state aid supervision; see decision of the European Commission of 18 Jul 1969 concerning the French aid system on promoting research as well as industrial and revenue-related structural improvements on the textile industry (official language is French), Official Journal of the EC [1969] L 220/1; of 30 Nov 1988 on the Belgian funds for the promotion of the farming of poultry and other small animals and of fruit and vegetable growing Official Journal of the EC [1989] L 85/45; of 17 May 1989 concerning a fund to encourage the marketing of pigmeat, beef and veal, sheepmeat, goatmeat and horsemeat, Official Journal of the EC [1990] L 179/38 et seq.; and of 19 Jun 2003, Aid No. N 707 and 708/2003, Official Journal of the EC [2004] C 148/12; likewise then also the decisions of the EC of 19 May 2006, Aid No. NN162/A/2003, N 317/A/2006, NN 162/B/2003 and N 317/B/2006, Official Journal of the EU [2006] C 221/8 and [2006] C 221/9.

  39. 39.

    Judgment of the ECJ of 17 Mar 1993, Case C-72/91 Sloman Neptun v B. Ziesemer [1993] ECR I-887; judgment of the ECJ of 30 Nov 1993, Case C-189/91 Kirsammer-Hack v Sidal, [1993] ECR I-6185; judgment of the ECJ of 7 May 1998, Joined Cases C-52/97, C-53/97 and C-54/97 Epifanio Viscido, Mauro Scandella and others and Massimiliano Terragnolo and other v Ente Poste Italiane [1998] ECR I-2629, para. 13; judgment of the ECJ of 8 May 2008 Joined Cases C-95/07 and C-96/07 Ecotrade SpA v Agenzia delle Entrate—Ufficio di Genova [1998] ECR I-7907, para. 35; judgment of the ECJ of 17 Jun 1999, Case C-295/97 Piaggio v Ifitalia and others [1999] ECR I-3735; judgment of the ECJ of 13 Mar 2001, Case C-379/98 PreussenElektra AG v Schleswag AG [2001] ECR I-2099.

  40. 40.

    Judgment of the ECJ of 2 Feb 1988, Cases 67/85, 68/85 and 70/85 van der Kooy and others v Commission [1988] ECR 219, para. 28; judgment of the ECJ of 8 Nov 2001, Case C-143/99 Adria-Wien Pipeline GmbH, Wietersdorfer & Peggauer Zementwerke GmbH v Finanzlandesdirektion für Kärnten [2001] ECR I-8365, para. 39; judgment of the ECJ of 17 Mar 1993, Case C-72/91 Sloman Neptun v B. Ziesemer [1993] ECR I-887, para. 19.

  41. 41.

    Judgment of the ECJ of 15 Jul 2004, Case C-345/02 Pearle BV and others v Hoofdbedrijfschap Ambachten [2004] ECR I-7139, para. 34.

  42. 42.

    Judgment of the ECJ of 16 May 2002, Case C-482/99 French Republic v Commission of the European Communities [2002] ECR I-4397, para. 37—Stardust Marine; Jaeger (2004), p. 558.

  43. 43.

    Art. 2 para. 2 Directive 80/723/EEC in the version of Directive 2005/81/EC.

  44. 44.

    Judgment of the ECJ of 15 Jul 2004, Case C-345/02 Pearle BV and others v Hoofdbedrijfschap Ambachten [2004] ECR I-7139, para. 36.

  45. 45.

    See judgment of the ECJ of 15 Jul 2004, Case C-345/02 Pearle BV and others v Hoofdbedrijfschap Ambachten [2004] ECR I-7139, para. 36.

  46. 46.

    Judgment of the ECJ of 30 Jan 1985, Case C-290/83 Commission v French Republic [1985] ECR 439, para. 5, 14, 15; judgment of the ECJ of 16 May 2000, Case C-83/98 French Republic v Ladbroke Racing Ltd and Commission [2000] ECR I-3271; judgment of the ECJ of 2 Feb 1988, Cases 67/85, 68/85 and 70/85 van der Kooy and others v Commission [1988] ECR 219, para. 36–37; judgment of the ECJ of 21 Mar 1991, Case C-303/88 Italian Republic v Commission [1991] ECR I-1433, para. 14; Ehricke (2007); art. 87 EC, para. 69.

  47. 47.

    Judgment of the ECJ of 2 Jul 1974, Case 173/73 Italian Republic v Commission [1974] ECR 709, para. 35—Family allowances in the textile industry.

  48. 48.

    Judgement of the ECJ of 22 Mar 1977, Case 78/76 Steinike and Weinlig v Germany [1977] ECR 595 judgement of the ECJ of 11 Nov 1987, Case 259/85 French Republic v Commission of the European Communities [1987] ECR 4393—State aid—Textile and clothing sector.

  49. 49.

    Judgment of the ECJ of 15 Jul 2004, Case C-345/02 Pearle BV and others v Hoofdbedrijfschap Ambachten [2004] ECR I-7139, para. 37.

  50. 50.

    Judgment of the ECJ of 30 Jan 1985, Case C-290/83 Commission v French Republic [1985] ECR 439, para. 5, 14, 15; judgment of the ECJ of 16 May 2000, Case C-83/98 French Republic v Ladbroke Racing Ltd and Commission [2000] ECR I-3271; judgment of the ECJ of 2 Feb 1988, Cases 67/85, 68/85 and 70/85 van der Kooy and others v Commission [1988] ECR 219, para. 36–37.

  51. 51.

    Decision of the EC of 19 Jun 2003, Aid No. N 707 and 708/2002 (Netherlands), Official Journal of the EC [2004] C 148/12; and of 19 May 2006, Aid No. NN 162/A/2003, N 317/A/2006, NN 161/B/2003 and N 317/B/2003, C-221/8 and C-221/9 2006—juris; decision of the EC of 5 Jun 2002, Aid No. C-43/2002 (Luxembourg), C-255/15 2002—juris; as well as of 19 May 2006, Aid No. NN 162/A/2003, N 317/A/2006, NN 161/B/2003 and N 317/B/2003, C-221/8 and C-221/9 2006—juris.

  52. 52.

    Decision of the EC of 5 Jun 2002, Aid No. C-43/2002 (Luxembourg), C-255/15 2002—juris.

  53. 53.

    Nagel (2000), pp. 161 et seq.; Schwintowski (2001), pp. 82 et seq.; Koenig and Kühling (2001), pp. 768–769.

  54. 54.

    Judgment of the ECJ of 13 Mar 2001, Case C-379/98, PreussenElektra AG v Schleswag AG [2001] ECR I-2099 para. 65; judgment of the ECJ of 22 Nov 2001, Case C-53/00 Ferring SA v ACOSS [2001] ECR I-9067, para. 16; Judgment of the ECJ of 17 Mar 1993, Case C-72/91, Sloman Neptun v B. Ziesemer [1993] ECR I-887, para. 21; Koenig et al. (2005), No. 162; Kruse (2001), pp. 576 et seq. Also the reference to duty to loyalty in art. 4 para. 3 TEU does little to change all this, because art. 107 TFEU is in this regard obviously lex specialis see Koenig and Sander (2000), p. 743; Ekardt and Schmeichel (2009b), pp. 171 (209); Ehricke (2007); Art. 87 EC, para. 69 et seq.

  55. 55.

    On the particular comparison see Ekardt et al. (2009), pp. 319 et seq.; furthermore Schlacke and Kröger (2013), pp. 313 (314).

  56. 56.

    Judgment of the ECJ of 2 Feb 1988, Cases 67/85, 68/85 and 70/85 van der Kooy and others v Commission [1988] ECR 219, para. 219 et seq.

  57. 57.

    Judgment of the ECJ of 15 Mar 1994, Case C-387/92 Banco Exterior de España v Ayuntamiento de Valencia [1994] ECR I-877, para. 14); judgment of the ECJ of 16 May 2002, Case C-482/99 French Republic v Commission [2002] ECR I-4397, para. 36.

  58. 58.

    Judgment of the ECJ of 8 Nov 2001, Case C-143/99 Adria-Wien Pipeline GmbH, Wietersdorfer and Peggauer Zementwerke GmbH v Finanzlandesdirektion für Kärnten [2001] ECR I-8365, para. 39–40; judgment of the ECJ of 2 Feb 1988, Cases 67/85, 68/85 and 70/85 van der Kooy and others v Commission [1988] ECR 219, para. 219 et seq.

  59. 59.

    See in place of many Schwintowski (2001), pp. 82 (84).

  60. 60.

    More detailed on this Ekardt and Schmeichel (2009a), pp. 737 et seq. as well as Ekardt (2019), ch. 4.8.

  61. 61.

    See Ekardt (2019) and Ekardt and Hennig (2015).

  62. 62.

    On the link between freedom and responsibility for consequences as an element of basic right assessment Ekardt (2006), pp. 63 et seq.; Ekardt (2016) § 4 C. V.; this is hinted on in judisdiction e.g. BVerfGE (German Federal Constitutional Court) pp. 115, 118 et seq.—Aviation Security Act.

  63. 63.

    (More on for instance issues if distribution and Border Adjustments) especially in Ekardt (2019); furthermore Bosnjak (2015), Hennig (2017), Hentrich et al. (2009), Nader and Reichert (2015) and Ekardt et al. (2015a).

  64. 64.

    Also on this Bach (2009), pp. 22 et seq.; Rodi (2008), pp. 49 et seq.

  65. 65.

    See Schwerd (2008), p. 355 and passim.

  66. 66.

    On this Franks et al. (2017), pp. 445 et seq.

  67. 67.

    See the short analysis on http://www.voxeu.org/article/joint-design-emission-tax-and-trading-systems#.VhWHiw_Pxox.twitter (accessed on 13.5.2018).

  68. 68.

    To avoid misunderstandings in this regard Ekardt et al. (2015a), ch. 3.3.2.1.

  69. 69.

    More on this already Ekardt et al. (2015a), ch. 2.4 and passim.

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  1. Research Unit Sustainability and Climate Policy, Leipzig, Germany

    Felix Ekardt & Jutta Wieding

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    Klaus Mathis

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    Avishalom Tor

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Ekardt, F., Wieding, J. (2019). EU Competition Law, Renewable Energies and the Tendering Model: Quantity Control Versus Price Control in Climate Politics. In: Mathis, K., Tor, A. (eds) New Developments in Competition Law and Economics. Economic Analysis of Law in European Legal Scholarship, vol 7. Springer, Cham. https://doi.org/10.1007/978-3-030-11611-8_16

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