* Britain working with Commission
* Lawyers say legal fix would take time
* Politicians say member states likely to oppose EU rule
By Barbara Lewis and Karolin Schaps
BRUSSELS/LONDON, March 21 Britain's plans to
reward nuclear plant operators through fixed prices for
low-carbon energy are illegal under existing EU rules and
efforts to adapt them are likely to draw opposition from other
member states, EU and legal sources said.
Britain plans to reform its electricity market to fix a
minimum price for nuclear, wind and solar-generated power, which
is carbon free.
The proposals are being assessed by the British parliament
but the subsidy instruments, named contracts-for-difference
(CfDs), will also require approval from the European Commission,
the EU executive, under state aid rules.
"Neither under the current (...) nor under possible future
frameworks could the CfD scheme for nuclear generators be
declared compatible with European state aid rules," said Doerte
Fouquet, a lawyer specialised in EU law at Becker Buettner Held
The British government is already in talks with France's EDF
about a CfD for the company's Hinkley point C nuclear
project in south-west England, Britain's first nuclear plant
since 1995, which is expected to start operating around the turn
of the decade.
The European Commission said it had not yet received a
formal notification from Britain, but added that, in general,
state aid is only authorised when the benefits of aid outweigh
the distortion of competition brought about.
A spokesman for Britain's Department of Energy and Climate
Change said Britain was talking to the EU executive.
"We are working with the European Commission to ensure
mechanisms and institutional arrangements within Electricity
Market Reform are consistent with EU state aid rules," he said.
To make changes to state aid rules, the Commission would
have to go through a lengthy consultation process with member
states and other parties that could take between one-and-a-half
and two years, Fouquet of Becker Buettner Held said.
Others question whether Britain could drum up enough support
for legal changes to be made to extend state aid rules to
"This raises the question if governments opposed to nuclear
energy, and they are in the majority, will allow such a legal
act to be drafted and decided by the EU Commission," said Claude
Turmes, vice president of the Green party in the European
The European Union has 27 member states.
Twelve of them issued a joint statement two weeks ago saying
their countries were supportive of nuclear power playing a role
in the future European energy mix.
Signatories included France, the Netherlands, Britain and
Poland. In contrast, dominant EU member state Germany has said
it will phase out nuclear power.