Security of Electricity Supply – An Investigation of National Measures Aimed at Ensuring a Secure Supply of Electricity and their Compatibility with EU Law

Abstract: Energy policy is a policy area of great significance for the Member States and for the EU. An integral part of every energy policy is the need to ensure a secure supply of electricity. At EU-level, the challenges to security of supply are to be managed via a coherent and coordinated approach aimed at taking into account the interest of the Union. Demand management, the further integration of the internal market in energy leading to increased trade between the Member States and a common definition of the notion of security of supply are all elements of such a coherent approach. In addition, several pieces of legislation have been adopted specifying a number of measures Member States can or should implement in order to safeguard a secure supply of electricity. However, the scope of action of the Member States is restricted by the EU State aid regime, aimed at safeguarding competition on the internal market by preventing excessive interference by the Member States in the electricity market. One purpose of this thesis has therefore been to investigate the restrictions EU State aid control puts on the Member States’ scope of action when implementing measures to ensure security of supply. Another purpose has been to investigate whether the measures envisaged by the Member States contribute to realizing the EU approach to security of supply or whether the national measures in fact hinder the objectives of the EU approach. By analyzing four Commission Decisions on State aid, I have been able to investigate the reasoning of the Commission when it comes to determining whether a specific measure aimed at ensuring security of supply constitutes State aid, and whether this State aid can be justified. My conclusion is that the State measures notified are found compatible with the State aid regime, either on the ground that the notified measure does not constitute State aid, or that the measure indeed constitute State aid but that this State aid can be justified. The consequence of the Commission finding the Member State measures compatible with the internal market is that the national notion of security of supply is reinforced. The measures notified to the Commission cement the borders of the national electricity markets and limit the trade between the Member States. Therefore in practice the success of the EU approach to security of supply is impeded.