Résumé : Le 26 septembre 2013, la Cour de Justice a rendu un arrêt, relatif à une question préjudicielle posée par la Cour Constitutionnelle belge. Notamment, la Cour de Justice a décidé que le régime wallon des doubles certificats verts accessible à toutes les installations de cogénération valorisant principalement de la biomasse, sauf celles qui valorisent principalement du bois ou des déchets de bois, ne constitue pas une discrimination, parce que la différence de traitement à l’encontre de ce type de cogénération est justifiée de par le fait que le bois n’a pas la même disponibilité et rentabilité que d’autres catégories de biomasse. Cet arrêt contraste quelque peu avec l’opinion de l’AG Bot rendue il y a quelques mois dans l’affaire précitée.
Samenvatting: Op 26 september 2013 beantwoordde het Hof van Justitie een prejudiciële vraag van het Belgische Grondwettelijk Hof. Het Hof van Justitie stelde daarbij dat het Waalse steunregime van dubbele groenestroomcertificaten aan installaties voor warmtekrachtkoppeling die voornamelijk biomassa valoriseren, met uitzondering van hout en/of houtafvalstoffen, geen schending inhoudt van het beginsel van gelijke behandeling en non-discriminatie, nu hout(afval) niet vergelijkbaar is met andere types biomassa, om redenen van beschikbaarheid en rendabiliteit. Dit arrest wijkt gedeeltelijk af van de opinie van AG Bot in dezelfde zaak.
Abstract: On 26 September 2013 the CJEU ruled upon a preliminary question by the Belgian Constitutional Court. The CJEU ruled that the Walloon regime of double green certificates to plants using principally biomass, other than wood or wood waste, is no violation of the principle of equal treatment, since wood is not comparable to other categories of biomass, for reasons of availability and cost-effectiveness. This ruling contrasts partly with the opinion of AG Bot in the same case.
- INTRODUCTION
For the very first time the CJEU has been called upon to provide its interpretation of Directive 2004/8/EC on the promotion of cogeneration based on a useful heat demand in the internal energy market and amending Directive 92/42/EEC (hereinafter “Directive 2004/8/EC”). Interestingly, the dispute opposes players of the Belgian energy market. Vielsam & Cie (hereinafter “IBV”) a player on the timber market is opposed to the Walloon Region as regards the application of the rules relating to financial support mechanisms for energy generated through cogeneration.
In order to encourage the development of electricity production from renewable energy sources or high quality cogeneration, the Walloon Government introduced a system of green certificates. According to art. 38 of the Walloon Electricity Decree green certificates are granted per 1 MWh of electricity generated, divided by the rate of savings of carbon dioxide. In practice such rate of savings of carbon dioxide is limited to 1 per plant for the production generated above 5 MW. However, for those plants using principally biomass, other than wood (and wood waste), derived from industrial activities performed at the site of the production plant on the basis of a particularly innovative process and acts with a view to sustainable development the regime is less stringent. Indeed, for those plants a more favorable regime, with a rate limited to 2 applies. In other words for these specific production plants a regime of “double green certificates” is organized.
On 26 September 2013 the CJEU ruled upon a preliminary question raised by the Belgian Constitutional Court. The latter inquired as to the conformity of the Walloon green certificates system with the principle of equal treatment and non-discrimination.
- FACTS OF THE CASE
In the realm of its activity, IBV uses wood and/or wood waste to ensure its own power supply through cogeneration. In 2008, IBV introduced an application before the Walloon energy regulator, CWaPE, to benefit from the favorable green certificates system as organized under art. 38 of the Walloon Electricity Decree. Under this provision of the Decree, additional support taking the form of double green certificates can be awarded if three requirements are met: (i) the concerned facilities/installations must mainly use biomass except for wood or wood waste, (ii) the installations must be part of a sustainable development process and (iii) they must be particularly innovative.
Based on the criteria set out in this provision (and explained here above), the Walloon government however considered that IBV was not to benefit from the favorable support mechanism. Consequently, IBV introduced a claim before the Council of State. The Council of State doubted whether the favorable Walloon regime for biomass, which according to the Walloon Electricity Decree does not apply to wood and wood waste, did not violate the principle of equality and non-discrimination (articles 10 and 11 of the Belgian Constitution). It referred a preliminary question to the Constitutional Court, which in its turn referred the question to the CJEU.
More particularly, the Belgian Constitutional Court wondered whether:
- Article 7 of Directive 2004/8/EC, relating to the national support schemes for cogeneration, […], and in the light of the general principle of equality, should be interpreted as meaning that (a), on the one hand, it applies only to facilities for high efficiency cogeneration such as defined in Annex III of Directive 2004/8/EC and, (b) on the other hand, that it imposes, permits or prohibits that a regional support measure is accessible to all installations which primarily use biomass and which comply with the legal requirements, except for those installations which primarily call upon wood and/or wood waste?
- The solution to this question would be different, if the installations only use wood, or on the contrary, only use wood waste?
- RULING OF THE CJEU
With regard to the first part of the first preliminary question, the CJEU noted that the scope of Article 7 of Directive 2004/8 is not limited solely to cogeneration plants which are high efficiency cogeneration plants.
Of greater importance is the answer of the CJEU with regard to: (i) the second part of the first preliminary question, and (ii) the second preliminary question. The CJEU decided to consider these questions together.
The CJEU started by stating that where a Member State adopts measures to support cogeneration and renewable energy sources within the EU framework, and while implementing EU law, it must observe the principle of equal treatment and non-discrimination (§49). Hence, and according to settled case-law of the Court, the principle of equal treatment and non-discrimination requires that comparable situations must not be treated differently and that different situations must not be treated equally, unless such treatment is objectively justified (§50).
With regard to the choices to be made when drawing up the national support schemes for cogeneration and electricity production from renewable energy sources which Directives 2004/8/EC and 2001/77/EC aim to promote, it clearly derives from these directives that the Member States retain a broad margin of discretion (§61). Each Member State is thus allowed to choose the regime that corresponds best to its particular situation, taking account the specific national circumstances especially regarding climatic and economic conditions (§62).
The CJEU noted that wood, which is a resource whose renewal requires a long period of time, may be distinguished from agricultural products or household and industrial waste, when considering (i) the (more or less) renewable nature of the resource, and hence its availability, (ii) the prudent and rational utilisation of natural resources (sustainable development), and (iii) the security of supply (§74). Indeed, e.g. the production of agricultural products or household and industrial waste takes place in a much shorter timeframe (§74). Furthermore, according to the CJEU, it is common ground that the overall environmental impact resulting from the increased use of biomass for energy production following from certain support measures, differs according to the particular characteristics of the type of biomass used (§75). As regards the environmental impact that could follow from enhanced support measures for the use of wood and/or wood waste for energy production, it may thus prove necessary to take into account that any excessive or premature deforestation which may be encouraged by such support measures, is liable to contribute to an increased presence of carbon dioxide in the atmosphere and adverse effects on biodiversity or water quality (§76).
These factors combined with a number of other factors, and while taking into account the broad margin of discretion for the Member States, lead the CJEU to the conclusion that biomass from wood and/or wood waste is not comparable to biomass from other sources. The need to be able to treat those various categories of biomass differently, including with regard to the amount of the support, must therefore be regarded as inherent (§81). The Member States do not manifestly exceed the limits of their broad discretion when granting different amounts of support to biomass from wood and/or wood waste compared to other categories of biomass (§81).
- REFLECTIONS
At first sight this ruling is a mere application of the principle of equal treatment and non-discrimination, that demands to treat alike situations alike and to treat different situations differently.
AG Bot did however propose a different solution in his opinion. According to him, the criteria of availability and cost-effectiveness are factors which must, in fact, be taken into account when considering the justification for different treatment of comparable situations (§67). In so far as concerns determining whether the situations at issue in the main proceedings are comparable, AG Bot was of the opinion that the comparison between the wood sector and other sectors must be carried out in the light of the subject-matter and purpose of the legislation in question, namely the promotion of electricity generation from renewable energy sources and high-quality cogeneration, the protection of the environment and the observance of the objectives of the Kyoto-protocol (§68-69).
Consequently, AG Bot stated that the Walloon support measure of double green certificates constitutes no discrimination, when it excludes from the benefit of double green certificates plants using biomass derived from wood, since the measure is appropriate to attaining the objective of preserving wood resources and safeguarding the wood industry (§82 + 85). Concerning wood waste however AG Bot took a different view to that of the Court.
According to AG Bot, the use of wood waste has no real influence neither on to the protection of forests nor on the competitiveness of the timber industry (§88). Moreover, considering the objectives of utilization of waste, cogeneration which uses biomass generated from wood waste, seems to promote environmental objectives (§92). In this respect AG Bot recalled that the Commission was favorable to investments in favor of energy-efficient technologies for the use of waste as fuel (§93).
According to the AG’s opinion, a policy which would not promote the use of wood waste would be contrary to the environmental objectives pursued by the EU (§94). Further in his opinion, AG Bot then underlined that wood waste has “dormant” potential that should be managed in the most efficient and most environmentally friendly way (§99). In this regard, the use of wood waste to produce energy was to be regarded as positive as it allows for the continuous improvement of waste management on the one hand, and the production of renewable energy, on the other hand.
As one can see, the CJEU and AG Bot do not share a similar position on wood waste. Time shall tell whether the approach of the CJEU discourages potential investors to produce renewable energy from wood or wood waste in the Walloon region.
