On March 9, 2016, the French administrative Supreme Court
("Conseil d'Etat") issued a noteworthy ruling regarding the French Energy Economy
Certificates ("Certificats d'économie
d'énergie" or CEE).
The French CEE scheme was created in 2005, and it requires energy
suppliers (including electricity, gas, fuel, and vehicle
gas/petrol) whose sales are above a certain threshold to
participate in energy saving, either through direct savings on
their own installations or by helping their customers to save
energy. Energy-saving actions eligible to obtain CEEs are defined
and listed by ministerial orders. CEEs can be traded on a market
that is not regulated by the authorities.
An association of alternative energy suppliers
("Association nationale des opérateurs
détaillants en énergie") brought an action
before the Conseil d'Etat to obtain the annulment of a
government decree dated December 20, 2013, modifying CEE
obligations and the CEE scheme. The claimants stated that the CEE
scheme qualified as a State aid, in violation of Article 107
paragraph 1 of the Treaty on the functioning of the European Union
("TFEU").
However, the Conseil d'Etat, which relied on
precedents by the Court of Justice of the European Union, ruled
that the CEE scheme, unlike greenhouse gas quotas, cannot be
considered as a State aid at the European level since it does not
create any aid directly or indirectly granted through State
resources. As a consequence, it was not necessary to submit the
disputed 2013 decree to the European Commission before its entry
into force.
Also, the claimants stated that the 2013 decree created a
difference of treatment between energy suppliers. Their point was
that "historical" energy operators (in particular, the
State-owned EDF and GDF (now Engie)) benefit more from the CEE
scheme than "alternative" (i.e., more recent) energy
operators. The amount of CEE that must be restituted by an energy
operator is calculated based on the volume of sales to end-users as
declared by energy suppliers, rather than their market shares. As a
consequence, historical operators, who have more sales and
therefore an important volume of CEE to obtain but also to trade,
allegedly benefit from more negotiation power on the
certificates' market. The Conseil d'Etat rejected
this last argument since the difference of treatment is created by
the law itself and not by the disputed decree.
This recent dispute demonstrates the existence and significance for
market players of an energy-saving market in France. From a
business point of view, since the launch of the CEE scheme, 90 percent of CEEs have been obtained through
standardized operations aimed at energy suppliers'
customers (private households, companies, public entities).
Additionally, 65 percent of energy savings were implemented in
residential building. It led to the development of a new market
of renovation/retrofitting works and service contracts and to the
creation of companies specialized in the collection and sale of
certificates. This rather recent market should participate in the
energy transition currently carried out in France.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
