State aid: Commission approves €1.36 billion Greek scheme to compensate energy-intensive companies for indirect emission costs

The European Commission has approved, under EU state aid rules, a Greek scheme to partially compensate energy-intensive companies for higher electricity prices resulting from indirect emission costs under the EU Emission Trading System (‘ETS').

The €1.36 billion scheme will cover part of the higher electricity prices arising from the impact of carbon prices on electricity generation costs (so-called ‘indirect emission costs') incurred between 2021 and 2030. It aims at reducing the risk of ‘carbon leakage', where companies relocate their production to countries outside the EU with less ambitious climate policies, resulting in increased greenhouse gas emissions globally.

The measure will benefit companies active in sectors at risk of carbon leakage listed in Annex I to the Guidelines on certain state aid measures in the context of the greenhouse gas emission allowance trading scheme post-2021 (‘ETS State aid Guidelines'). Those sectors face significant electricity costs and are particularly exposed to international competition.

The compensation will be granted to eligible companies through a partial refund of the indirect emission costs incurred in the previous year. The maximum aid amount per beneficiary will be equal to 75 % of the indirect emission costs incurred.

The Commission assessed the measure under EU State aid rules, and in particular the ETS State aid Guidelines. On this basis, the Commission approved the Greek scheme under EU State aid rules.

Executive Vice President Margrethe Vestager (pictured), in charge of competition policy, said: "This €1.36 billion scheme enables Greece to reduce the risk that energy-intensive companies move their activities to locations outside the EU with less ambitious climate policies. The scheme maintains the incentives for a cost-effective decarbonisation of Greece's economy, in line with the European Green Deal objectives, while ensuring that competition distortions are kept to the minimum."

A press release is available online.

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