New Environmental State Aid Guidelines

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The new ‘Guidelines on State aid for Climate, Environmental Protection and Energy’ (CEEAG) have been endorsed and adopted by the European Commission on 21 December 2021, coming into force on 1 January 2022. The revision aims to ensure that state aid rules do not impede the European Green Deal goals.

“The new Guidelines endorsed today are about increasing the good and limiting the bad” explained European Commission Vice-President Margrethe Vestager. “Among others, they will facilitate investments by Member States, including in renewables, to accelerate the achievement of our Green Deal, in a cost-effective way. This is a major step to ensuring that our state aid rules play their full role in supporting the European Green Deal.

The revised guidelines will allow support to projects for environmental protection and low-carbon development and will be open to all technologies that can contribute to the European Green Deal. These include renewables, energy efficiency measures, clean mobility, circular economy, pollution reduction, and protection and restoration of biodiversity. The revised rules generally allow for aid of up to 100% of the funding gap, especially where aid is granted after competitive bidding.

To ensure a fast and widespread transition, the guidelines place special focus on empowering citizens, communities, and SMEs. Renewable Energy Communities can now benefit from aid without competitive bidding if projects are below 6MW capacity, or 18MW for wind generation. For energy efficiency, member states can provide up to 300,000 EUR per project to SMEs for energy efficiency improvements, also without competitive bidding.

New sections are introduced into the guidelines for clean mobility and energy efficiency in buildings. Aid may be granted for acquisition and leasing of new and used clean vehicles,  retrofitting, refitting and adaptation of vehicles, and deployment of recharging and refuelling infrastructure. For buildings, aid is allowed for measures aiming to improve energy and environmental performance, including installation of renewables, energy storage and installation of charging infrastructure.

The exemptions in the guidelines are enabled by the General Block Exemption Regulation (GBER) which sets out when state aid may be provided without prior notification to the Commission. The GBER itself is currently under revision to further enable sustainable investments by broadening the range of exempted measures to include new technologies such as hydrogen and carbon capture. The proposal is expected in 2022.

For more information, see the ‘Guidelines on State aid for Climate, Environmental Protection and Energy’, or see Vestager’s speech of 21 December.

Credit: Photo by mpalis on Envato Elements
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