EFTA SURVEILLANCE AUTHORITY DECISION

No 329/09/COL

of 15 July 2009

on the Norwegian scheme on support for alternative, renewable heating and electricity savings in private households

(Norway)

THE EFTA SURVEILLANCE AUTHORITY (1),

HAVING REGARD to the Agreement on the European Economic Area (2), in particular to Articles 61 to 63 and Protocol 26 thereof,

HAVING REGARD to the Agreement between the EFTA States on the Establishment of a Surveillance Authority and a Court of Justice (3), in particular to Article 24 thereof,

HAVING REGARD to Article 1(2) of Part I and Articles 4(4), 6 and 7(3) of Part II of Protocol 3 to the Surveillance and Court Agreement (4),

HAVING REGARD to the Authority‘檚 Guidelines on the application and interpretation of Articles 61 and 62 of the EEA Agreement (5),

HAVING REGARD to the Authority‘檚 Decision No 195/04/COL of 14 July 2004 on the implementing provisions referred to under Article 27 of Part II of Protocol 3 (6),

HAVING CALLED on interested parties to submit their comments pursuant to those provisions (7) and having regard to their comments,

Whereas:

I. FACTS

1. PROCEDURE

By letter dated 13 October 2006 (Event No 393383) the Norwegian Association of Heat Producers (Varmeprodusentenes Forening) (8), filed a complaint alleging that state aid was granted in connection with the Norwegian scheme for alternative, renewable heating and electricity saving measures in private households (9). The Complainant is an independent organisation whose objective is to safeguard the interests of producers of wood burning stoves. The Complainant submitted supplementary information by letter dated 19 October 2006 (Event No 395451).

On 19 December 2007, after various exchanges of correspondence (10), the Authority decided to initiate the procedure laid down in Article 1(2) of Part I of Protocol 3. The Authority‘檚 Decision No 716/07/COL to initiate the procedure was published in the Official Journal of the European Union and the EEA Supplement thereto (11). The Authority called on interested parties to submit their comments thereon.

On 4 February 2008, the Norwegian authorities submitted comments (Event No 463573).

The Authority also received comments from interested parties, which were forwarded to the Norwegian authorities on 21 May 2008, 26 May 2008 and 14 January 2009 (respectively Event Nos 477954, 477902 and 503830). The Norwegian authorities submitted their observations on these comments by letters dated 25 June 2008, 4 July 2008 and 6 March 2009 (respectively Event Nos 483303, 484722 and 511580).

By letter dated 2 April 2009, the Complainant supplied further information (Event No 514264), which was forwarded to the Norwegian authorities on 8 April 2009 (Event No 514886). By letter dated 7 May 2009, the Norwegian authorities presented further comments (Event No 517749).

On 21 April 2009, representatives of the Authority met with representatives from the Norwegian Bio Energy Association (12), an independent association whose objective is to promote rational utilisation of bioenergy in Norway. NOBIO had submitted observations to the Authority‘檚 Decision on 21 May 2008 (Event No 477954).

2. DESCRIPTION OF THE PROPOSED MEASURE

2.1. THE ALTERNATIVE HEATING SCHEME

The alternative heating scheme was introduced in 2006 (13). The Norwegian authorities have explained that it is aimed at giving consumers an incentive to invest in certain environmentally friendly heating technologies which have a limited spread on the Norwegian market and which can contribute to the reduction the use of electricity in private households (14). The Norwegian authorities have explained that only technologies which are suitable replacements to electricity as a primary source of heating are included under the alternative heating scheme. The scheme covers pellet stoves and boilers, heat pumps connected to waterborne heating systems and control systems for reducing consumption of electricity. As of August 2008 (15), investments in solar heating collectors connected to waterborne heating systems are also included in the scheme.

Only households that invest in the relevant heating technologies after submitting an application are eligible for funding. The grants are disbursed ex post, after the recipient has submitted a proof of purchase. Private households can apply for a maximum refund of 20 % of documented and eligible costs. The grants are limited to NOK 4 000 for pellet stoves and electronic control systems. For heat pumps, pellet boilers and solar heating collectors the limit is NOK 10 000.

The aid scheme is administered by Enova SF, a public company (‘�span class="italic">statsforetak