The UK government's plans to subsidize development of a new nuclear power plant are in line with EU state aid and environmental law, according to a ruling from the EU's highest court Sept. 22. The EU Court of Justice dismissed a case brought by Austria, which had sought to block construction of the planned Hinkley Point C nuclear power station in southwest England.
"The principle of protection of the environment, the precautionary principle, the 'polluter pays' principle and the principle of sustainability, relied on by Austria in support of its action for annulment, cannot be regarded as precluding, in all circumstances, the grant of state aid for the construction or operation of a nuclear power plant," the court's judgment said.
Austria had argued that an agreement to support plant owners EDF Energy through a guaranteed price, or strike price, for the electricity produced at Hinkley Point C was illegal state aid.
The Luxembourg-based Court of Justice today added "that the generation of nuclear energy... does indeed constitute an economic activity" eligible for state aid.
The European Commission in 2014 approved the UK government plans for state aid to create new capacity for the generation of nuclear energy at Hinkley. In 2018 Austria lost an appeal for the Commission's decision to be annulled at the EU's lower tier General Court. Austria then asked the Court of Justice to set the General Court judgment aside.
The latest judgment finds that the General Court "rightly" confirmed that the UK "was free to determine the composition of its own energy mix."
This ruling is in line with a May 7 opinion from an advocate general for the EU Court of Justice, finding that there is nothing in the EU treaties to block investment in Hinkley Point.
The judgment also rejects "as unfounded Austria's various arguments to the effect that the construction of a new nuclear power station does not constitute an objective of common interest."
The UK formally left the EU on Jan. 31 and is in a transition period until Dec. 31, 2020, during which it has agreed to abide by EU court decisions.
This judgment is the final ruling in the case, meaning there is no possibility of appeal by Austria.
