On Wednesday 16 March, the European Commission authorised two support schemes, one in Spain (€2.9 billion) and one in the Czech Republic (€1.4 billion), to partially compensate energy-intensive companies for higher electricity prices resulting from indirect emissions costs under the EU Emissions Trading System.
Both schemes will cover a portion of the higher electricity prices resulting from the impact of carbon prices on electricity production costs (‘indirect emissions costs’) incurred between 2021 and 2030. The support measures aim to reduce the risk of carbon leakage when companies relocate production to third countries with less ambitious climate policies.
The measure will benefit companies in sectors at risk of carbon leakage listed in Annex I of the Guidelines on State aid in the context of the greenhouse gas Emissions Trading System after 2021. Compensation will be provided to eligible companies in the form of a partial reimbursement of indirect emissions costs incurred in the previous year, with final payment due in 2031.
The maximum aid amount will generally be 75% of the indirect emissions costs incurred. However, in some cases (Spain), the maximum amount of aid can be higher to limit the remaining costs of indirect emissions to 1.5% of the company’s gross value added.
In order to receive compensation, companies will have to implement certain recommendations from energy audits or cover at least 30% of their electricity consumption with carbon-free sources, or (in the case of Spain) invest at least 50% of the amount of aid in projects that lead to substantial reductions in greenhouse gas emissions from their facilities. (Original version in French by Lionel Changeur)