Letter to DG Competition: Observations on the German lignite opening decision

In light of the decision to open a formal investigation procedure, ClientEarth has sent a letter to the European Commission to raise further concerns about the compensations to German lignite operators. The lawyers say that the compensations must be qualified as state aid, that there is no need for this support in the uncompetitive and unprofitable lignite sector, and that there is no incentive effect. Furthermore, it remains unclear how the amounts were calculated and all attempts to do so lead to the conclusion that they are grossly disproportionate. There are strong indications that the payments result in a violation of the ‘polluter pays’ principle and a distortion of the market.