Connect with us

Hi, what are you looking for?

CleanTechnica

Policy & Politics

Germany’s FIT & Minimum Wage Are Not “State Aid”

Originally published on the Lenz Blog.

This excellent article at Zeit Online (in German) by Armin Steinbach gives another strong reason the present German feed-in tariff system for renewable energy is not “state aid” under European Union competition law.

The author notes that states can set minimum wages by law. If a state does that, employers need to pay their employees more than under simple market mechanisms. As an alternative, a state could choose to pay workers on low wages some kind of aid from taxpayer funds.

The first case is not state aid, since there are no taxpayer funds involved. The second one is.

In the same way, the feed-in tariff sets a “minimum wage” for solar, wind, and other renewable energy. That means that buyers of that electricity need to pay more than under a model that would leave all prices purely to market forces.

But just like with a minimum wage, there are no taxpayer funds involved. Which means that there is no state aid, and Commissioner Almunia should lose the case the German government just started against him at the European General Court.

That in turn is good news for renewable energy in Germany, which can get rid of the useless and harmful ideas the EU Commission has about how a feed-in tariff should be built. And it would be good news for the principle of democracy, which frowns on attempted power grabs by EU institutions. The Commission gets exactly as much powers as the Member States have transferred to this institution. If they could just start deciding about every policy question around with the excuse that there may be some kind of state aid angle, that would be the end of democracy, and the end of German participation in the European Union.

 
Don't want to miss a cleantech story? Sign up for daily news updates from CleanTechnica on email. Or follow us on Google News!
 

Have a tip for CleanTechnica, want to advertise, or want to suggest a guest for our CleanTech Talk podcast? Contact us here.
Advertisement
 
 

is a professor of German and European Law at Aoyama Gakuin University in Tokyo, blogging since 2003 at Lenz Blog. A free PDF file of his global warming science fiction novel "Great News" is available here.

Comments

You May Also Like

Batteries

The solid-state EV battery of the future is not quite there yet, but BMW Group has seen enough to nail down an R&D partnership...

Cars

Almost one out of every three new vehicles sold in Germany in 2022 had a plug.

Clean Power

One of the big criticisms anti-EV people try to level against cleaner vehicles is the environmental costs of production. In many cases, it’s a...

Aviation

There's a lot to like in the new US transportation decarbonization blueprint. It's actually very good in most ways, which is excellent to see...

Copyright © 2023 CleanTechnica. The content produced by this site is for entertainment purposes only. Opinions and comments published on this site may not be sanctioned by and do not necessarily represent the views of CleanTechnica, its owners, sponsors, affiliates, or subsidiaries.