The European Court of Justice has rejected Austria's appeal against the European Commission's 2014 decision to approve the UK's support for the Hinkley Point C nuclear power plant, which is under construction in Somerset, England. The Court of Justice, the supreme court of the European Union in matters of European Union law, agreed with the Commission that the project is in line with EU state aid rules.
The Commission had approved aid which the UK planned for Hinkley Point C, with the aim of creating new nuclear energy generating capacity. The plant is scheduled to start operations in 2023.
The aid, which is in three parts, is envisaged for the future operator of Hinkley Point C, NNB Generation Company Limited, which is a subsidiary of EDF Energy plc. The measures at issue were a contract-for-difference; an agreement between NNB Generation’s investors and the UK's Secretary of State for Energy and Climate Change, guaranteeing compensation in the event of an early shutdown of the nuclear power station on political grounds; and a credit guarantee by the UK on bonds to be issued by NNB Generation that is intended to ensure the timely payment of principal and interest of qualifying debt.
In its decision, the Commission classified those three measures as state aid compatible with the internal market pursuant to Article 107(3)(c) TFEU.
The Luxembourg-based Court of Justice announced today: "Hearing an appeal brought by Austria, the Court of Justice was, essentially, called upon to answer the question, not previously addressed in the case-law, whether the construction of a nuclear power station may benefit from state aid approved by the Commission pursuant to Article 107(3)(c) TFEU. Dismissing the appeal, the Court answered that question in the affirmative."
"The Court, first of all, pointed out that, in order to be declared compatible with the internal market under Article 107(3)(c) TFEU, state aid must meet two conditions, the first being that it must be intended to facilitate the development of certain economic activities or of certain economic areas, and the second being that it must not adversely affect trading conditions to an extent contrary to the common interest. That provision does not, on the other hand, require planned aid to pursue an objective of common interest."
