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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".
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Author:Nuthall, Keith
Publication:International News
Date:Jul 1, 2006
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