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The EAG under scrutiny – unconstitutional subsidy limit for energy communities?


We are already examining possible strategies for the practical enforcement of your claims due to the probably unconstitutional subsidy limit of 50% for energy communities.

The provisions on the market premium of the Renewable Energy Expansion Act (EAG) are not yet in force. Nevertheless, this has been and continues to be hotly debated, especially in legal literature. At the heart of the matter is the following: Renewable energy communities (EEG) and citizen energy communities (BEG), which operate green electricity plants based on PV, hydropower, wind power, biomass and biogas, can only be subsidized by market premiums up to a maximum of 50% of the total amount of electricity generated within an EEG and BEG (cf. for EEG: § 80 (2) EAG; for BEG: § 16b (5) ElWOG 2010). Consequently, energy communities can feed in and sell up to 100% of the electricity they generate into the public grid, but – unlike all other system operators – only receive market premiums for 50% of the electricity they generate and feed in. There is no question that this can lead to competitive disadvantages in individual cases.

Recently, in an article from Haslinger / Nagele (cf. RdU-UT 2021/17, 62) in the journal RdU, possible concerns under Union and constitutional law regarding the above-mentioned provisions restricting market premiums for EEG and BEG were discussed. These considerations have already been taken up in expert circles (see, for example, Krönke/Tschachler, Decentralized Energy, RdU 2021/127, 249).

In view of these well-founded concerns and the approaching first opportunity to submit bids for subsidies, a possible way for affected energy communities to enforce their rights is outlined below. Upfront: it can be assumed that any individual application to the Constitutional Court for a judicial review (Art. 140 of the Federal Constitution Law) would be inadmissible since the “detour” via the civil courts seems reasonable.

1. Selling more than 50% of the electricity generated within the community:

As a first step, the EEG or BEG should ensure that electricity supply contracts are concluded with third parties who are external to the community (typically the energy suppliers) to the extent of more than 50% of the electricity generated within the community.

2. Submission of a bid within the framework of the relevant tendering procedure of the EAG subsidy processing office:

In the second step, the EEG or BEG should submit a bid to the EAG subsidy processing office as part of the respective tendering procedure and specify more than 50% of the part of the electricity generated within the community as the amount of electricity to be subsidized. The EAG subsidy processing office would most likely restrict the bid so that it applies to exactly 50% of the electricity generated within the community, or even reject it altogether.

3. After rejection by the EAG subsidy processing office: Civil law action for the conclusion of a contract

Since market premiums are paid on the basis of subsidy contracts (Section 17 (1) EAG) and the civil courts are responsible for disputes between an EEG or BEG and the EAG subsidy processing office (Section 99 EAG), EEG or BEG could file an action for the conclusion of a contract for the amount of electricity exceeding 50% at the competent civil court and in doing so already assert the concerns under Union and constitutional law. If the civil court does not share these concerns, it will not allow the lawsuit.

4. On the occasion of an appeal raised against it: individual application for norm control

On the occasion of an appeal raised against it, the EEG or BEG could raise an individual application for norm control (Art. 140 (1) d B-VG) at the Constitutional Court. The high threshold of admissibility, which would go hand in hand with the “direct” way – an individual application for norm control (Art 140 (1) lit c B-VG) – does not have to be passed here. If the Constitutional Court, for example, subsequently joins the constitutional concerns about § 80 (2) EAG, it would grant the party’s application and repeal the contested provision or wording. The civil law appeal proceedings before the appellate instance would be suspended until the Constitutional Court has ruled on the matter.

5. After positive Constitutional Court decision: conclusion of contract for the part exceeding 50%

In this case, the appellate court would have to apply the provision without the successfully contested word sequence. In the present case, this would probably result in the EEG or BEG being awarded the market premium contract over the 50% exceeding part of its community electricity volume. If the law is successfully enforced, an immense economic advantage can be gained compared to the current legal situation.

If you are interested, our members of our 360° Renewable Energy Practice GroupJohannes Hartlieb, Kaleb Kitzmüller, Mario Laimgruber and Emil Nigmatullin – will help you and your energy community to take action against the 50% limit, which we believe is vulnerable, with manageable effort and risk. Contact us via 360ee@haslinger-nagele.com or by phone at +43 1 7186680-0.

 

5. January 2022

 
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