General Court dismisses action against Commission’s decision on State aid for Iberian Electricity Price Adjustment Mechanism
Today, the General Court (GC) has issued its judgment on case PGI Spain and Others v Commission (T-596/22), concerning an action for the annulment of Commission Decision SA. 102454 and SA. 102569 dealing with the production cost adjustment mechanism for the reduction of the electricity wholesale price in the Iberian market.
The applicants contended that the Commission’s assessment of the notified measure was inaccurate. They argued that the Commission failed to account for retail market buyers also use hedging mechanisms, such as financial power purchase agreements (PPAs), similar to wholesale buyers. Furthermore, they claimed the Commission breached the principle of non-discrimination by excluding retail buyers with hedging agreements from receiving the same benefits as wholesale buyers, despite their comparable circumstances.
The Court dismissed these claims ruling that the Commission had appropriately differentiated between wholesale and retail market buyers and that the applicants failed to present sufficient evidence to substantiate their arguments.
Moreover, the Court also dismissed the applicants’ claim that the Commission and the EU had encouraged financial power purchase agreements, particularly to support renewable energy, and that they could have reasonably expected equal treatment with companies that had not used hedging mechanisms.
As a result, the GC dismissed the applicants’ action in its entirety.
For more information, see the GC’s judgment.