* EU nations can limit renewable support to within borders
* Ruling goes against advocate-general opinion in January
* Overhaul of EU countries' green energy laws avoided
* German econmin says no obstacles now to renewables law
(Adds comment from the European Commission)
By Nina Chestney
LONDON, July 1 Sweden's renewable energy support
scheme is compatible with European Union law, the EU's top court
said on Tuesday, in a ruling that means member states will avoid
a radical overhaul of their renewable energy laws.
The EU's Court of Justice (ECJ) said the ruling meant EU
member states can continue to limit renewables support schemes
to within their national borders.
The ruling was unexpected as it went against the opinion of
the court's top legal official in January, which had argued that
Sweden had broken rules in EU treaties on free movement of
goods. The ECJ tends to follow the official's judgement in most
"The Swedish support scheme promoting green energy
production in the national territory is compatible with EU law,"
the Luxembourg-based ECJ said in Tuesday's ruling.
EU states that support the production of green energy, such
as wind and solar power, through subsidies or incentives are not
required to support the use of green energy which is produced in
another EU country, it said.
The case has political resonance as Europe struggles to wean
itself off green energy subsidies, which are blamed for
inflating costs and making the European Union less competitive.
The Commission has been pushing for harmonised subsidies
across the bloc and encourages cross-border movement of power as
part of a single energy market to limit costs and maximise
The ruling will put less pressure on Germany - which is at
odds with the European Commission over its energy subsidies - to
reach a compromise with the Commission.
German economy minister Sigmar Gabriel welcomed Tuesday's
"The European Court of Justice has sent a clear signal on
the continued support of renewable energy in Europe," Gabriel
said in a statement.
The Swedish case arose after Sweden, which offers energy
subsidies to companies in Sweden, refused to award them to wind
power generated on the Aland archipelago, which lies between
Finland and Sweden.
Although it is part of Finland, Aland is connected to
Sweden's power grid and it is Swedish-speaking.
Wind energy company Alands Vindkraft in 2009 appealed
Sweden's decision on subsidies to the Swedish courts, saying the
support scheme violated principles on the free movement of
The case was referred to the ECJ in 2012 and in January this
year the court's advocate-general Yves Bot advised that member
states be given up to two years to restructure their support
schemes to make them compatible with EU law, which would have
paved the way for an integrated EU renewable energy market.
GERMAN RENEWABLES LAW
Renewable energy industry groups also welcomed Tuesday's
"(The ruling) will provide added clarity for investors in
the wind industry and reinforces stable regulatory frameworks,
which are of paramount importance," said Justin Wilkes, deputy
chief executive officer of the European Wind Energy Association.
Germany and the European Commission have been wrangling for
a while over a German policy under which consumers pay a
surcharge to finance renewable energy while heavy industrial
users are exempt.
The Commission raised new objections last week, which led to
Germany offering to change its planned reform at the last
The German government proposed that industrial companies
which generate their own power on-site in new renewable or
combined heat-power plants would pay a higher surcharge than
Economy minister Gabriel said Tuesday's ruling had removed
any lingering EU obstacles to Berlin's renewable energy law.
"I am assuming now that there are no more state-aid related
obstacles to the German renewable energy law," Gabriel said in
his statement on Tuesday.
The European Commission said it was analysing the possible
implications of the ruling.
"Regarding the ongoing assessment of the German Renewable
Energy Act 2014, it should also be borne in mind that the
concerns raised by the Commission relate to other treaty
provisions than free movement and quantitative restrictions on
imports," a spokesman for Joaquin Almunia, vice president of the
European Commission, said.
(Additional reporting by Vera Eckert and Markus Wacket in
Germany and Martin Santa in Brussels; Editing by Greg Mahlich
and Susan Fenton)