Press Release: State aid: Commission opens in-depth investigation into grants for new oil-shale fuelled power plants in Estonia

The European Commission has opened an in-depth investigation under EU state aid rules into an Estonian project to grant state support of up to €1.5 billion spread over 20 years to the operators of two newly-constructed 300 MW power plants. The aid would be paid for the mere availability of the plants, provided that they are mainly fuelled with oil-shale, a hydrocarbon widely available in Estonia. Estonia claims that the aid is necessary to increase the security of energy supply. While the Commission acknowledges the importance of securing energy supplies, it has, at this stage, doubts that the proposed Estonian measure would be the least distortive means to achieve this objective.

In particular, large-scale subsidies would be allocated over a long period without a tender procedure. This could result in discouraging investment into alternative technologies in Estonia and in neighbouring Member States and in crowding out competitors, who would have to operate without such aid. The opening of an in-depth investigation allows interested third parties to comment on the measure under scrutiny. It does not prejudge the outcome of the procedure.

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