Italy electricity subsides challenged by European Commission.
A GROUP of heavy electricity consumers in Italy may have to repay
special electricity bill reductions allowed by the Italian government,
which could be condemned as illegal by the European Commission. It has
launched a detailed probe into compensation from a state fund, the Cassa
Conguaglio del Mercato Elettrico, for part of their power bills.
Aluminium producer Alcoa for its smelters in Sardinia and Fusina, near
Venice, is a key beneficiary, along with heavy industrial plants
operated by Thyssen-Krupp Acciai Speciali Terni, Cementir and Nuova
Terni Industria Chimica. Alcoa's Sardinia plant is a particular
bugbear, with Brussels claiming the subsidies "could create a
serious distortion of competition in the European market of primary
aluminium, where energy is an important ... cost." But the other
plants' subsidies are also questioned on the serious grounds that
they are ineligible for regional aid because they "are not located
in areas with a very low standard of living and high unemployment".