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State Aid

State aid: No aid in power contracts to United Silicon in Helguvík



Today, the EFTA Surveillance Authority cleared United Silicon's power purchase agreement with Landsvirkjun as well as its transmission agreement with Landsnet. The Authority has concluded that these contracts do not involve state aid.

For reasons of legal certainty, the Icelandic authorities notified to the Authority a contract on the sale of electricity for a silicon metal plant to be constructed and operated by United Silicon hf. in Helguvík. The Authority assessed the relevant elements of the power purchase agreement signed by Landsvirkjun, the national power company, and in addition the transmission agreement signed by Landsnet, the operator responsible for transmission of electricity in Iceland.

The Authority found that the power purchase agreement was concluded on market terms and therefore does not entail state aid. The power will be exclusively provided by Landsvirkjun's existing power generation system and the contract price is higher than the average production costs of Landsvirkjun's existing power plants.

Similarly, the Authority concluded that there is no state aid involved in the step-down surcharge and the system contribution pursuant to the transmission agreement. There is no economic advantage conferred to United Silicon in the form of exemptions from charges that should be borne by the company. All surcharges are calculated according to statutory rules and general principles applicable in Iceland and therefore do not entail state aid. 


A non-confidential version of the decisions will be published in the register of state aid decisions on the Authority's website, normally within a month.


For further information, please contact:

Mr. Andreas Kjeldsberg Pihl
Press & Information Officer
tel. (+32)(0)2 286 18 66
mob. (+32)(0)492 900 187

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