EU Lays Out State Aid Push to Stoke Green Investments Public Comment DEADLINE: April 25, 2025

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March 11, 2025

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by Francesca Micheletti and Aude van den Hove (Politico) State aid rules underpinning the Clean Industrial Deal aim to boost renewable power, decarbonization and clean tech. --

New European Union state aid rules would allow governments to speed up aid to renewable energy, help pay the costs of industrial decarbonization and stoke demand for clean-tech products.

The European Commission is seeking feedback by April 25 on its proposed state aid framework to support the Clean Industrial Deal, aiming to finalize the subsidy rules in June.

The rules also open up more support for industries to invest in hydrogen to decarbonize, which could help steelmakers and other energy-intensive industries who are complaining about heavy demands in meeting new climate rules and paying higher energy bills.

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Industry investments in decarbonization could get state aid of up to €200 million, up to 50 percent of the cost of a project that enables the use of hydrogen, up to 35 percent for renewable energy projects and 30 percent of carbon capture equipment.

To roll out programs more quickly, aid for renewable hydrogen and other "less mature technologies" could be granted without a tender. Governments must insist that hydrogen investments mostly use renewable hydrogen.

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The rules allow EU governments to match subsidies offered by a non-EU country to lure a project overseas. The rules specifically say they can't back a project relocating within the EU.

The proposal aims to replace the current Temporary Crisis and Transition Framework and be in force until 2030. READ MORE

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Commission invites comments on the draft State aid Framework supporting the Clean Industrial Deal (European Commission)

Excerpt from European Commission: The European Commission has launched today a consultation inviting all interested stakeholders to comment on its draft State aid Framework accompanying the Clean Industrial Deal (‘CISAF').

On 26 February 2025, the Commission published the Communication on the Clean Industrial Deal: A joint roadmap for competitiveness and decarbonization, announcing the adoption of a new State aid Framework in the second quarter of 2025. Today, the Commission is launching a consultation on the draft text of CISAF. The adoption is planned for June 2025.

The CISAF will accompany the Clean Industrial Deal by setting out how Member States can design State aid measures to support its objectives, building on the experience with the Temporary Crisis and Transition Framework (‘TCTF') transition provisions (i.e. sections 2.5, 2.6 and 2.8 TCTF). Once adopted, the CISAF will replace the TCTF and is intended to be in force until 31 December 2030, offering a longer planning horizon for Member States, and investment predictability and certainty for businesses. It will ease certain standard requirements, like the mandatory bidding process to allocate State aid, which will speed up the use of the schemes once they are set up by Member States.

Interested parties can respond to the consultation until 25 April 2025. The proposal and details about the consultation are available here.

The new draft framework

The draft CISAF sets out the conditions under which State aid for certain investments and objectives would be considered compatible with the internal market. The Commission encourages Member States to set up aid schemes where appropriate. Once authorized by the Commission, State aid schemes allow for a quick deployment of individual aid grants. It therefore contributes to the simplification of State aid rules for projects that contribute to accelerating the Clean Industrial Deal objectives.

The draft CISAF contains provisions for the following types of aid measures:

Measures accelerating the rollout of renewable energy: Member States would be able to set up schemes for investments in renewable energy and energy storage with simplified tender procedures that can be quickly implemented, while including sufficient safeguards to protect the level playing field. Member States could devise schemes for specific technologies given their particular national energy mix. They would also be able to grant aid for less mature technologies, such as renewable hydrogen, in a simplified process without a tender. Member States would need to ensure that the eligible projects are implemented within a specific timeline to ensure an effective acceleration effect. The proposal also contains specific facilitations for State aid for non-fossil flexibility and capacity mechanisms;
Measures facilitating industrial decarbonisation: Member States would be able to support investments in all relevant technologies leading to decarbonisation. Member States could either (i) set up tender-based schemes, or (ii) directly support projects, without tenders, within certain limits. For very large projects, Member States would need to show that the public funding does not exceed the project's funding gap. Member States would need to ensure that eligible projects are implemented within a specific timeline to ensure an effective acceleration effect;
Measures ensuring sufficient manufacturing capacity in clean technologies: the proposal would allow support from Member States for the production of certain clean technology equipment (currently defined as: batteries, solar panels, wind turbines, heat-pumps, electrolysers and carbon capture usage and storage) as well as the key components and critical raw materials necessary for the production of such equipment. Member States would be able to set up aid schemes to support the necessary investments up to certain limits (increased for investments in assisted areas). Subject to strict safeguards, Member States could also provide higher aid amounts to match the level of support offered in third countries for a particular project, to avoid such investments being diverted away from Europe.
Measures to de-risk private investments: Member States could adopt measures to reduce the risks associated with private investments in renewable energy, industrial decarbonisation, manufacturing capacity in clean technologies as well as certain energy infrastructure.

Next steps

The consultation is open until 25 April 2025. This will ensure that both Member States and other interested parties have sufficient opportunities to comment on the draft Commission proposal whilst allowing for timely adoption. The draft CISAF is open to comments on all aspects, and is accompanied by a questionnaire posing a number of specific questions.

In addition to the consultation launched today, the proposal will be discussed in a multilateral meeting with the Member States.

Background

The proposal under consultation follows a survey of Member States to gathered information on their experience with the TCTF transition provisions. The survey showed that overall, the TCTF has been useful and helped accelerate investments. The draft CISAF as presented today builds on the information gathered from the Member States as well as the experience of the Commission in implementing the TCTF.

On 20 February the Commission published the latest State aid brief, showcasing data on the use of the TCTF. The document highlights that, by June 2024, the Commission approved €47 billion in aid under the TCTF transition provisions, with €2.4 billion effectively granted by Member States. The data also shows that already in the first semester of 2024, the majority of Member States for which such ‘transition measures' were approved had started implementing them.

The other State aid communications (e.g. the Climate, Environmental protection and Energy Aid Guidelines) continue to apply in parallel and may be used by Member States for different and more complex measures.

Quote(s)
Teresa Ribera, Executive Vice-President for Clean, Just and Competitive Transition
Today's proposal aims to ensure that Member States can provide support – where needed – to accompany the ambitions of the Clean Industrial Deal without causing undue distortions of competition in the Single Market. We encourage all interested stakeholders to share their views

Teresa Ribera, Executive Vice-President for Clean, Just and Competitive Transition READ MORE