State aid: Commission clears Belgian support to long-term operation of three nuclear power reactors Tihange 1, Doel 1 and Doel 2
The European Commission has found Belgian plans to compensate Engie-Electrabel and EDF Belgium for potential financial risks linked to long-term operation of three nuclear reactors to be in line with EU state aid rules.
In September 2016, the Belgian authorities notified measures related to the prolongation of the operational lifetime of three nuclear reactors (Tihange 1, Doel 1 and Doel 2) to the Commission for assessment under EU state aid rules.
Under the EU Treaties, Member States are free to determine their energy mix and have the choice to invest in nuclear technology. The Commission's role is to ensure that, when public funds are used to support companies, this is done in line with EU state aid rules, which aim to preserve competition in the Single Market.
In 2014 and 2015, Belgium concluded two agreements with Engie-Electrabel and EDF Belgium to prolong the operational lifetime of the nuclear reactors Doel 1 and Doel 2 (owned by Engie-Electrabel) and Tihange (owned by Engie-Electrabel together with EDF Belgium). Under the agreements, the companies have committed to invest around 1.3 billion in exchange for authorisation to run the plants for another ten years. The companies would receive financial compensation, if Belgium decides to close the reactors before the end of the ten-year period, modifies the level of nuclear tax to be paid by the owners or changes other economic parameters of the agreements. According to Belgium, nuclear energy requires long-term commitment and these guarantees were necessary to secure the investment of the companies.
The Commission's assessment found that the investment guarantees provide an economic advantage to Engie-Electrabel and EDF, which goes beyond what they would have been entitled to under general Belgian law. Under EU rules, such state aid has to be limited and proportionate to the objectives pursued.
The Commission concluded that Belgium has demonstrated that the measures avoid undue distortions of the Belgian energy market. There will be an obligation on Engie-Electrabel, i.e. the major player on Belgian electricity markets, to sell on regulated electricity markets each year a volume equivalent to Engie-Electrabel's share of the annual production of Tihange 1, Doel 1 and Doel 2. It will ensure liquidity on Belgian electricity markets and help increase competition between electricity suppliers. On this basis, the Commission has approved the measures under EU state aid rules.
The non-confidential version of the decision will be published in the State aid register on the competition website under the case number SA.39487 once eventual confidentiality issues have been resolved. The State Aid Weekly e-News lists new publications of state aid decisions on the internet and in the EU Official Journal.
Separately, the Commission has also issued today (3/17) favourable Points of View with a number of recommendations under Article 43 of the Euratom Treaty on the compatibility of the investment projects related to the long term operation of the three nuclear reactors with the objectives of the Euratom Treaty.