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IP/07/815
Brussels, 13th June 2007
State aid: Commission opens investigation
into regulated electricity tariffs in France
The European Commission has opened under EC Treaty
state aid rules a formal investigation into potential aid to large and
medium-sized companies in France in the form of artificially low regulated
electricity tariffs that are financed by the state directly or indirectly. The
Commission will assess whether the regulated tariffs constituted state subsidies
to large and medium-sized companies and if so, whether such aid could give rise
to disproportionate distortions of trade and competition within the EU Single
Market. The Commission's state aid investigation does not however concern
regulated tariffs for households and small companies. The decision to open an
investigation gives interested parties an opportunity to comment on the proposed
measure. It does not prejudge the outcome of the investigation.
Competition Commissioner Neelie Kroes commented: “The state financing
of certain companies' electricity costs could distort competition between
European industries and prevent consumers from fully enjoying the benefits of
the Single Market."
French electricity consumers can buy their electricity either on the
liberalised market or on the regulated market. On the regulated market, they buy
the electricity from distributors designated by the French State, at regulated
prices. The regulated prices are currently considerably lower than the
electricity prices on the liberalised market. Since the beginning of 2007,
clients who had left the regulated market can return to it and pay electricity
prices that are above the original regulated prices, but still below the market
prices. The system appears to be financed mainly by the state-owned company
Electricité de France (EDF) and by parafiscal contributions levied on all
French electricity consumers and administered by the state.
The Commission is concerned in particular about the potential distortion of
competition entailed in the "green" and "yellow" tariffs which are the lowest
ones and applicable to medium and large companies, and can effect mostly in the
markets for products made by energy-intensive companies. The investigation does
not cover the "blue" tariffs (applicable mainly to households and small
companies) since they do not seem to grant any economic advantage to the
relevant companies.
The competition problems raised by artificially low state-regulated tariffs
were highlighted by the conclusions of the Commission's energy sector
competition inquiry (see IP/07/26
and MEMO/07/15).
The Commission has already opened an infringement case against France concerning
the regulated tariffs arrangements, which may be incompatible with the
electricity liberalisation Directive 2003/54/EC (see IP/06/1768).
The Commission opened already an in-depth investigation into regulated
electricity tariffs in Spain on 25 January 2007 (see IP/07/93).
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