BRUSSELS -- After resolving the drawn-out dispute over state backing for German public-sector banks, the European Commission has another German case: a law aimed at fostering ecologically produced electrical power.
German officials met commission negotiators Friday to discuss the issue after European Competition Commissioner Mario Monti, sent a letter to German Finance Minister Hans Eichel.
Mr. Monti criticized Germany's Renewable Energy Act, a project initiated by the governing coalition of Social Democrats and the Greens. The act forces not only private-sector customers but also public-sector city grids and regional providers to pay high minimum prices for ecological power from private-sector energy producers, the communiqué said.
Since the city and regional customers are state-owned, the law effectively gives rise to a transfer of public funds to the private sector, which therefore qualify as state backing, according to Mr. Monti's complaint.
The German government calls the objections "nitpicky and misguided," and has been pushing for a review of the law by Michel Petite, chief judge of the European Court of Justice. The court had granted approval to the law, but later, the commission's legal arm recommended an inquiry.
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