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A question/request on terminology: do you consider a feed-in law a "subsidy", as opposed to "support"?

In my understanding, a "subsidy" means extra money paid from tax money, and thus doesn't describe a proper feed-in law (though there are 'feed-in laws' that involve a compensation of the price difference to distributors by the state, for example Hungary...). A feed-in law is a guarantee on the entire price, whether it's above or below the market price. Treating the entire price as if it were the extra price, and calling it subsidy, is one of the nasty tricks of its detractors.

So I would make a consequent distinction in the text.

*Lunatic*, n.
One whose delusions are out of fashion.

by DoDo on Sun Mar 2nd, 2008 at 01:30:51 PM EST
Feed in laws would be subsidies if the money came from the state, but that is not necessarily the case, e.g. in Germany under the Erneuerbare Energien Gesetz the situation is that the power companies have to buy renewables at this rate.

There's a even an ECJ judgment stating that this is not 'State Aid', as I'm sure you will all be very interested to learn ;-)

From the judgment:

THE COURT,

in answer to the questions referred to it by the Landgericht Kiel by order of 13 October 1998, hereby rules:

  1. Statutory provisions of a Member State which, first, require private electricity supply undertakings to purchase electricity produced in their area of supply from renewable energy sources at minimum prices higher than the real economic value of that type of electricity, and, second, distribute the financial burden resulting from that obligation between those electricity supply undertakings and upstream private electricity network operators do not constitute State aid within the meaning of Article 92(1) of the EC Treaty (now, after amendment, Article 87(1) EC).

  2. In the current state of Community law concerning the electricity market, such provisions are not incompatible with Article 30 of the EC Treaty (now, after amendment, Article 28 EC).
by nanne (zwaerdenmaecker@gmail.com) on Sun Mar 2nd, 2008 at 04:44:13 PM EST
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