EFTA Surveillance Authority Backs State Aid to Midtfjellet Vindkraft Wind Project in Norway Under the Energy Fund

EFTA Surveillance Authority (ESA) has approved today a state aid in favour of a wind power production project to Midtfjellet Vindkraft AS. The amount of the aid is of NOK 346.5 million (nearly EUR 44.5 million), focusing on the coverage of the investment costs of the project. The aid was notified to ESA in February 2011, and submitted to a detailed assessment under the State aid Guidelines for environmental protection. In its press release, ESA justifies its positive assessement in the following standard terms:

"...the Authority has found that the positive effect of increasing renewbale energy production outweighs the limited effect of the aid on competition. The aid is proportional as it is limited to the aid necessary to trigger investments in the wind park. The aid also provides an incentive effect since the project would not be commercially viable without the aid. Finally, the market power of Midtfjellet Vindkraft AS is less than 1% and hence the structure of the market for electricity production is unlikely to be altered by the grant of aid."

As previous state aids approved by ESA, the present one is given under the Norwegian Energy Fund Scheme. See previous post here.