Energy: EU green light to extend and increase state aid to companies

Energy: EU green light to extend and increase state aid to companies

But specifically concerning the support granted for the rise in gas and electricity prices (direct subsidies, tax advantages, guarantees, etc.), a company will now be able to receive up to 4 million euros (compared to 2 million previously) – even up to 100 or 150 million for companies in the most energy-intensive sectors (mines, paper mills, chemicals, cement, glass, steel, etc.).

The terms and conditions of this aid have been drastically simplified. For companies receiving the most significant aid, state support must however be conditional on targets for reducing the carbon footprint of their energy consumption and on “energy efficiency measures“, insists the Commission.

Finally, the Commission is broadening the scope of permitted aid, by authorizing States to provide public guarantees to energy companies to help them cover the financial collateral necessary for their transactions on the energy markets – where the level of Collateral requirements have jumped, posing serious problems for cash-strapped firms.

The revision adopted on Friday “gives Member States more flexibility to put in place appropriate support schemes, while continuing to encourage ecological transition, while maintaining safeguards to ensure that aid remains targeted and proportionate“, assured the Commissioner for Competition, Margrethe Vestager.

At the same time, this framework maintains market incentives for these companies to further reduce their energy consumption, since they will always have to bear part of the price increase.“, she insisted.