PABLO R. SUANZES
Updated Thursday, October 14, 2021 – 11:37
He believes, speaking about the intervention in the price of electricity, that public service obligations may fall “in electricity but not in some electricity”, but considers that the bond may not have a time limit and that compensatory measures are not necessary.
Electricity in Madrid JAVI MARTNEZ
The social bonus of the electricity companies is discriminatory as it is being applied and contrary to European legislation, but the lack of a time limit and the absence of compensatory measures that characterize it is in accordance with the law. This was estimated by the EU Court of Justice this Thursday, responding to a series of preliminary rulings sent by the Spanish Supreme Court.
In December 2014, E.ON Spain (currently Viesgo Infraestructuras Energticas) filed an appeal with the high court against the Royal Decree of the Government that sets the distribution percentages of the bankable amounts of the social bond, which is the compensatory discount that the most vulnerable households can access, for social or economic reasons, in the electricity bill.
The Supreme Court upheld the appeal considering that it was incompatible with the European Directive, but the General State Administration filed another appeal for protection before the Constitutional Court, which in turn upheld it, annulling the sentence for violating the right to a trial with all legal requirements. guarantees, since the Supreme Court had not consulted with the CJEU about possible doubts and incompatibilities of law. The Supreme Court chose to consult with Luxembourg and the Community magistrates have ruled today.
The main question is whether, with the European directive in hand, it is legal for the financing of the social bond to fall only on some agents of the electrical system (“the matrixes of the groups of companies or, where appropriate, companies that develop simultaneously the activities of production, distribution and commercialization of electrical energy “) when” some of those obliged subjects have very little specific weight in the sector as a whole, while other entities or business groups that may be better off are exempted from said burden. conditions of assuming this cost, either due to their volume of business, due to their relative importance in any of the activity sectors or because they carry out simultaneously and in an integrated manner two of those activities “.
And indeed, the CJEU, in its judgment today, declares that the Community Directive is contrary to the fact that the cost of financing the social bond should fall solely on the parent companies of the groups of companies or companies that develop at the same time the production, distribution and commercialization of electrical energy, since this criterion, chosen by the national legislator, “leads to a difference in treatment between the differentcompanies operating in that market that is not objectively justified“.
The judgment recalls that Community legislation empowers the States to impose on electricity companies, “in the interests of the general economic interest”, public service obligations of various kinds, and the CJEU specifically confirms that the obligation to partially finance the cost of the social bond it is a public service obligation within the meaning of the Directive. But there can be no blatant discrimination.
“This obligation consists of two inseparably linked elements: on the one hand, the discount on the price of electricity supplied to certain vulnerable consumers and, on the other hand, the financial contribution to cover the cost of this discount. Thus, the controversial compulsory financial contribution, as it is an integral part of the public service obligation related to the social bonus, falls within the scope of the Directive “, the European judges say.
The second issue is extremely topical because it affects the intervention of national governments in setting the price of electricity. The judgment recalls that different types of intervention may be admitted if, among others, “the requirement that the public service obligations established must not be discriminatory is met. Thus, the Directive allows the imposition of public service obligations of a general nature. to the electric companies and not to some specific companies.
Therefore, the designation system for companies in charge of public service obligations cannot a priori exclude any of the companies operating in the electricity sector. Consequently, any possible difference in treatment must be objectively justified. ”
The thesis of the State in this matter is that in fact the social bond has been imposed on all electrical companies that commercialize electricity in the Spanish market, but the CJEU agrees that “the financial burden of this obligation, which is intended to cover the costs of the discount in the price of electricity provided for by the social bond, does not affect all these electricity companies “, so it urges the Supreme Court to verify” if the differentiation made between the companies that must bear the weight of said load and those that are exempt from it is justified objectively “, since it understands that the differentiation criterion chosen by the national legislator is not objectively justified “, since it estimates that all companies that develop at least one of the activities mentioned above should contribute to financing it.
The Court of Justice emphasizes that, “if, as indicated by the Spanish Government, the financing scheme of the social bond has the result of transferring more than 99% of the cost of said bond to the five most important operators in the Spanish electricity market, The criterion chosen by the national legislator to distinguish between the companies that must assume, to a greater or lesser degree, this cost and those that are totally exempted from doing so leads to a difference in treatment between the different companies that operate in that market that is not objectively justified “.
In the second preliminary ruling question sent by the Supreme Court, the high community court considers, however, that the European directive does not oppose the financing system of the social bond being established without a time limit and without a compensatory measure, since the principle of proportionality cannot be interpreted “in the sense that Member States are obliged to periodically and frequently re-examine the financing scheme of a public service obligation “and there is also no requirement in the regulations to set any compensation when it comes to public service obligations.
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