Thank you for your Explanatory Memorandum on the Lead Market Initiative. It was considered by Sub-Committee B during its meeting on 10 March 2008. It was agreed to hold this dossier under scrutiny.

  The Committee noted the figures stated in the EM for the expected increase in the size of the renewable energy market in the UK. These figures suggest that the UK is expecting much more significant growth in this area than the Commission is expecting for the EU as a whole.

  The Committee also raised concerns about the possible implications for public finances of this initiative. Although the EM states that the proposals would not include changes to existing state aid rules, the Communication makes reference to the reorientation of National or Regional State aid schemes". The Committee would appreciate clarification on what such reorientation might entail.

  The Committee is due to taken evidence on the EU's renewable energy target from BERR officials at its next meeting, 17 March. The Committee would be grateful if these concerns could be addressed during this meeting.

12 March 2008