The European Commission’s (EC’s) latest guidance on state subsidies in the electricity sector said it wants the market, rather than government guarantees, to be the prime driver of wind, solar and other renewable sources.

In a statement on the guidance – which could help determine whether national governments are within future EU state-aid rules – the EC said “in practical terms” this would mean feed-in tariffs being replaced by feed-in premiums, where the incentive element rises or falls with power prices.

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