EnergyBit: State aid complaint on the disposal of nuclear waste in the Netherlands

Loyens & Loeff, European Union, Netherlands, August 22 2017

According to LAKA, an environmental protection organisation, it is not the nuclear waste producers who pay for the processing and storage of nuclear waste themselves, but the Dutch state. Consequently LAKA lodged a state aid complaint with the European Commission.

LAKA is supported in its claim by fifteen individuals who produce renewable energy with solar panels (for an explanation about state aid issues regarding renewable energy we refer to a previously published EnergyBit). They argue that the Dutch state distorts the competition on the energy market by exempting undertakings that produce nuclear waste by paying for the costs related to the processing and storage of such waste.

Companies that produce nuclear waste pay a state-owned company, named COVRA, a certain fee to process and store the waste and in the long term, in about 130 years, for the final disposal of the waste.

In essence LAKA argues that the fee that nuclear waste producing companies pay, is not in line with market conditions compared to obligations for (private) individuals who produce energy using solar panels or windmills. This, among others, has an anti-competitive effect on the latter group. In particular, the interest rate that COVRA expects to gain on the fees is unrealistic according to LAKA, and will therefore be insufficient to cover the costs for the final disposal of the nuclear waste. LAKA states that the system in the Netherlands differs from systems for the processing and storage of nuclear waste in other countries, because from the moment a company sells its waste to COVRA it is indemnified from all risks and costs that could arise from the storage and final disposal of the waste.

A spokesperson of the Ministry of Infrastructure and the Environment already commented on the complaint, stating that nuclear waste producing companies pay for all the phases of the processing and storage of nuclear waste and that the fees charged by COVRA are therefore in accordance with market conditions and European Union state aid legislation.

It is now up to the European Commission to decide whether to open an in-depth investigation or to dismiss the case. In case the European Commission rules that the Dutch state granted illegal state aid to nuclear waste producing companies, the Dutch state must reclaim the amount that it should have charged to these companies in accordance with market conditions.

It is unclear if this case will be the start of an increase of state aid complaints regarding the nuclear power industry similar to the complaints against certain renewable energy aid schemes. We will monitor this case and keep you updated by means of new EnergyBits.

Loyens & Loeff - Redmar Damsma and Fons Leijten

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