Lawsuit lurks despite Hinkley Point C progress

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Despite the enthusiasm greeting yesterday’s Hinkley Point C investment announcement, there still remains the matter of lawsuits filed by the Austrian government, Greenpeace Energy and nine German and Austrian utilities.

The parties contesting the decision to facilitate the nuclear power project hold that the European Commission has breached the EU’s state aid guidelines, and if their challenge is successful it would make the project much more expensive as well as lead to Hinkley Point C sign potential, costly delays.

In relation to the news of Chinese participation, top Austrian lawyer, Reinhard Schanda, a partner at the Vienna-based law firm Sattler & Schanda told Power Engineering International, “I can’t see why the identity of the shareholders of the project should influence the legal opinion of the European Court of Justice re the admissibility of state aid promised by the UK.”

“Should the ECJ finally decide that the state aid promised by the UK must not be granted, the investment will prove a very unprofitable investment. This will be true for any investor, be it EDF alone, or EDF plus CGN.”

Schanda had previously told PEi he felt the lawsuit had a good chance of success while Dr Dorte Fouquet, Partner, BBH Brussels who has been advising Vienna on the matter of their objection to Britain’s flagship nuclear power project on the basis of State Aid contravention, told an audience at Platts Power Summit in central London at the end of April that if Vienna presses on with its challenge it could set back construction of the Hinkley Point C project for around four years based on average case statistics.

Meanwhile the Austrian government is continuing to wait for the UK’s Final Investment Decision on the project, which would activate its legal challenge.

Austrian Federal Ministry of Science, Research and Economy spokesperson Alexandra Perl, told Power Engineering International, “There is nothing new to report. Austria has filed a lawsuit at the European Court of Justice and is now waiting for the further development.”

Luxembourg had expressed its intent to follow Austria’s example telling this publication in March, “Yes we are going to follow Austria. That’s the decision of the Luxembourg government.” On Thursday, their government environment department press spokesperson, Olaf Munichsdorfer reaffirmed that intent, telling PEi, "Luxembourg still supports Austria so nothing has really changed. We will submit our intervention request in the case within the deadline set."

Meanwhile ClientEarth energy lawyer Susan Shaw said the British government ought to understand the implications the lawsuits continue to represent.

“Much as David Cameron might like to think otherwise, the future of Hinkley point is not just a decision for the British or Chinese governments.  There remain ongoing legal challenges against the Commission’s approval of the eye-watering public subsidies for the project and the distorting effect they will ultimately have on the entire EU internal energy market."

“Although the UK government seem intent on pressing on with construction at any cost, these legal challenges will hang over this project for a number of years to come. If ultimately successful, the outcome is that any aid already received would have to be repaid.  There is also the question of whether the aid approved is in fact implemented in accordance with the approved terms. These risks are ultimately paid for by every British tax-payer. And it is clear that there will be many market participants and others actively monitoring these developments over the coming months and years.” 


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