EU probes AustriaÂ’s green power act

The 27-nation European Union's executive also approved a plan to grant subsidized feed-in tariffs — electricity prices above market price — paid to producers of green electricity to compensate them for extra costs.

"The Commission supports the development of renewable energy," EU Competition Commissioner Neelie Kroes said in a statement.

"However, at this stage, the envisaged exemption of large electricity consumers from the funding of green electricity needs further investigation."

The Commission said it had doubts that the proposed exemptions for energy-intensive industries were compatible with EU state aid rules.

Austria's new green electricity act stipulates that energy intensive industries may be exempted from the obligation to buy green electricity and contribute to the funding of green electricity in Austria, the Commission said.

"An exemption from contributions to the funding of green electricity may provide these industries with an unfair competitive advantage," the EU executive said.

"As a result, enterprises not qualifying for exemption may be burdened with extra cost for purchasing additional amounts of green electricity," it added.

The Commission said the lunch of an in-depth probe did not prejudge its final decision and has invited third parties to comment on the case.