European Commission temporarily allows more ‘green’ subsidies

The European Commission is making it easier for EU countries to support key sectors in the transition to a carbon-neutral economy. It wants to stimulate investments in the development of clean technologies. A more favorable subsidy climate should prevent companies from leaving for the United States, for example, where billions of dollars in “green” subsidies are available.

The EU Executive Committee warns that the new measures are temporary in nature. For example, member states may, under certain circumstances, provide government aid until December 31, 2025 for “strategic” production, such as batteries, solar panels, wind turbines, heat pumps, electrolysis, and carbon utilization and storage. The committee hopes for faster deployment of renewable energy, energy storage and the decarbonization of industrial production processes.

The Commission also allows member states to provide an amount to companies in exceptional cases if there is a “real risk that investments will flow away from Europe”. The amount of assistance could be equal to what the company would receive in that other location or something that would encourage the company to stay and invest in Europe. There are strict conditions for this. The first is that the beneficiary must use the latest production technology in terms of emissions.