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Hydropower concession regimes in Europe: status, issues, lessons to learn

July 2014

Florence School of Regulation


Vincent Rious presented the results of a report jointly prepared by the Florence School of Regulation (Jean-Michel Glachant) and Microeconomix (Marcelo Saguan, Vincent Rious, Sébastien Douguet and Emmanuella Gentzoglanis). This research has benefited from financial support provided by ASSOELETTRICA and FEDERUTILITY.

The European States are in various situations with regard to their legislation for granting or renewing rights to use hydropower. Some countries implement a competitive process to grant rights to use hydropower to new installations (e.g. France, Italy, Great Britain or Spain) or to renew them (e.g. France or Italy) while others do not (e.g. Norway) and their duration greatly varies from some years (in Great-Britain, for new hydropower plants) to unlimited duration (Sweden). In this context, the European Commission actions raise questions: it has launched several procedures concerning the compatibility of hydropower right granting with European laws and regulations in several countries (e.g. France, Spain, Italy, Portugal, etc.) while other hydropower regimes (e.g. in Austria or Sweden) are not subject of such investigations despite not being grounded on competitive process.

Understanding and grabbing the main differences between the national hydropower regimes is then of particular interest.

The main objective of this study is hence to provide a benchmarking of hydropower concession regimes in Europe, describing hydropower regimes in 10 European countries (Austria, France, Germany, Great-Britain, Italy, Norway, Portugal, Spain, Sweden and Switzerland) and regions when appropriate (e.g. cantons in Switzerland or Lands/States in Germany).

This report describes and scrutinizes hydropower regimes through a unified analysis framework around 4 blocks: (1) the institutional framework of hydropower regimes (e.g. type of rights to use hydropower, authorities granting rights to use hydropower, etc.); (2) the framework for granting right to use hydropower (duration of rights and procedure, competitive process and existence of a possible EC infringement procedure); (3) the obligations of the hydropower operator (environmental and investment obligations and royalties); and (4) small hydro characterisation and support schemes. The report draws conclusion on the institutional heterogeneity surrounding hydropower regimes, liabilities on hydropower operators with regard their environmental impacts and unequal pressure for competitive processes. 

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