EC Approves Funding for French Power Plant Project

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Written by Martin Lynch, European News Editor for Industrial Info (Galway, Ireland)--The European Commission (EC) has approved a funding plan by the French government for the proposed Landivisiau gas-fired power plant, which is designed to help alleviate blackouts in the Brittany region.

Commissioner Margrethe Vestager, in charge of competition policy, said: "The construction of the Landivisiau power plant in Brittany will help to make sure that there are no electricity blackouts in Brittany. At the same time, competition in the electricity market is preserved. The Commission has worked closely with France to ensure that support for the construction of the power plant is in line with European Union (EU) state aid rules."

The 422-megawatt (MW) plant is being built by Compagnie Electrique de Bretagne (CEB), a joint venture created by Direct Energie (Paris, France) and German engineering major Siemens (NYSE:SI) (Munich, Germany). The project, which is under construction, will cost 450 million euro ($498 million). The plant was granted a subsidy of €94,000 ($104,000) per megawatt produced per year over a 20-year period in return for a commitment from the plant operators to ensure electricity generation when required by the network operator.

The Commission began its in-depth investigation into the state-aid proposals in November 2015. It concluded that "the measure was compatible with EU state aid rules, in particular its 2014 Guidelines for Energy and Environmental Protection."

"This part of the network is more exposed to voltage control issues because it is located far away from electricity generation plants," the Commission stated. "France has also demonstrated that the measure is appropriate to address the supply needs in the region, as the plant's output is flexible and can be ramped up and down at very short notice to ensure voltage levels at this location. Finally, the Commission considered that the aid amount is proportionate given the expected rate of return of the beneficiary."

Brittany, located in the northwest of the country, is one of France's 18 regions but is largely reliant on electricity generated elsewhere. It is prone to electrical outages, and in 2010, an agreement called the Breton Pact was signed between local authorities, grid operator RTE and the French Environment and Energy Management Agency (ADEME). It sets out three key proposals to address the control of electricity consumption, development of renewable energy and improving the security of electricity supply. Since then, Brittany has become an important region for the country's young offshore wind industry.

Last month, Industrial Info reported that construction of one of the country's first large offshore wind projects, the 496-MW Saint-Brieuc project in Brittany, was ready to kick off after the developer received all three administrative authorisations required. For additional information, see April 26, 2017, article - Green Light for Brittany's First Offshore Windfarm.

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