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Merkel Says Waiver for Energy-Intensive Companies May Be Reduced

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March 7 (Bloomberg) -- German Chancellor Angela Merkel signaled she may reduce power-grid fee waivers for companies that use large amounts of energy as the European Union probes the practice over concerns it may be an illegal government subsidy.

Germany is in “very intensive talks” with the European Commission, the EU’s executive body, and is revising regulation related to the exemptions, Merkel told reporters in Berlin today. The government seeks to come up with “a fair system” that doesn’t put at a disadvantage German companies that are competing globally and identifies those industries that aren’t, she said.

The commission said yesterday that it is probing the exemptions, worth 300 million euros ($393 million) last year, following complaints from consumer groups, energy companies and others. The EU said it was concerned that it gave German companies an unfair advantage over rivals elsewhere. The waiver is financed by a levy paid by other consumers.

Germany is confident the waivers do not constitute illegal subsidies as they aren’t financed with tax money, Economy Minister Philipp Roesler said at the same event. The new regulation could take effect “this summer,” he said.

To contact the reporter on this story: Stefan Nicola in Berlin at snicola2@bloomberg.net

To contact the editor responsible for this story: Reed Landberg at landberg@bloomberg.net

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