Tories seek Holyrood answers on cross-border renewable energy subsidies following European court ruling

With an early start to the new Holyrood parliamentary term today – so as to leave a ‘purdah’ period for Scotland’s Independence Referendum next month – the Scottish Conservatives have set a potential trap for the Scottish Government over its hopes that that taxpayers in England would continue to subsides development of renewable energy projects in Scotland after independence.

Based on the precedent of the recent European Court of Justice ruling, Murdo Fraser, MSP, Chairman of the Scottish Parliament’s Energy Committee, has put down two questions for Scottish Energy Minister Fergus Ewing to answer on this issue.

In the ECJ case, the court rule in the case of Alands Vindkraft AB v Energimyndigheten [the Swedish Energy Agency] it was decided that such cross-border subsidies are not legal. Consequently, Fraser has asked the Scottish Government:

“What impact the European Court of Justice ruling ] will have on its plans for renewable energy in an independent Scotland and how an independent Scotland will fund (a) existing and (b) planned renewable energy schemes and what impact this will have on consumers.”

In  its  ruling  in  Ålands  Vindkraft  AB  v  Energimyndigheten  (C-573/12)  the  European  Court  of  Justice  (ECJ)  found  that  the  Swedish  green certificate scheme  is compatible with EU law.  The case was brought in Sweden and referred by the competent Swedish court to Luxembourg. The referring court asked the  ECJ  whether  a  support  scheme  for  renewable  energy,  which  excludes  foreign generation  sources  from  participating  in  the  scheme,  such  as  the  Swedish  green certificate  scheme,  infringes  EU  rules  guaranteeing  free  trade  within  the  internal market. 

The  ECJ  considered,  in  essence,  that  a  restriction  of  the  internal  market rules  is  justified  based  on  current  EU  law,  notably  given  that  the  EU  has  not harmonised  national  support  schemes  for  green  electricity. 

Many renewable industry observers consider the judgment,  which contradicts the Opinion of Advocate General Bot issued earlier this year,  to be a  missed opportunity to help Europe find a more efficient way to support renewables and restore the integrity of the internal electricity market (IEM).

* Meanwhile, Tavish Scott, LibDem MSP (Shetland) has also asked the Scottish Government ‘what plans or proposals there are to take forward renewables projects in the Scottish Government estate.’