A series of measures by the Dublin local authorities in Ireland to participate in the Poolbeg waste to energy project have been found to be in line with the EU state aid rules.
According to the European Commission, which made the ruling, since the project will be carried out on market terms, it does not involve any state aid within the meaning of the EU rules.
Following a public tender, the Dublin local authorities entered into negotiations with Dublin Waste to Energy Limited (DWTEL) concerning the construction, maintenance and operation of a large-scale waste to energy plant located on the Poolbeg peninsula in Dublin.
The planned facility will be a combined heat and power system (CHP) that uses municipal solid waste as fuel to generate electricity for the general public and is expected to process approximately 550 000 tonnes per annum of waste.
The Dublin authorities will participate in the project through a series of measures, such as a waste revenue guarantee, a waste and electricity revenue sharing mechanism and a profit sharing schedule.
This raised the question as it whether or not such activity constitutes ‘state aid.
Public interventions in companies that carry out economic activities can be considered free of state aid within the meaning of the EU rules when they are made on terms that a private player operating under market conditions would have accepted - the so-called ‘market economy investor principle’.
However, the Commission explained that its investigation demonstrated that the project will be carried out on terms that a private investor operating in a market economy would have accepted. Indeed, Dublin’s local authorities see in the project a business opportunity with a fair return on investment.
As such, the Commission said that the Poolbeg waste to energy project involves no state aid as defined by Article 107 of the Treaty on the Functioning of the European Union (TFEU).
The non-confidential version of the decision will be made available under the case number SA.36591 in the State Aid Register on the competition website once any confidentiality issues have been resolved.
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