Belgium, (Brussels Morning Newspaper) The European Commission approved Poland’s aid scheme worth 10 billion euro to help energy-intensive companies.
In a statement released on Monday, the EC pointed out that electricity prices are rising due to costs under the EU Emission Trading System (ETS).
The scheme will partly cover increased cost of electricity in the period between 2021 and 2030, with the Commission stressing that the move is aimed at lowering the risk of companies moving their production to countries with less strict environmental policies, known as carbon leakage.
The body noted that such relocation of production results in higher global greenhouse gas emissions and added that energy-intensive sectors of the economy are especially exposed to international competition.
Margrethe Vestager, European Commissioner for Competition, pointed out that the scheme “paves the way for Poland to reduce the risk of carbon leakage for its energy-intensive industries.”
“At the same time, the incentives for a cost-effective decarbonisation of its economy will be maintained, in line with the Green Deal objective, and undue competition distortions will be limited,” she concluded.
Higher costs partially refunded
The Commission noted that Polish companies will be partially refunded for higher cost of electricity under the scheme, with maximum aid per recipient capped at 75% of indirect emission costs under the ETS.
To be eligible, companies will have to cover 30% or more of their consumption with renewables, implement energy audit recommendations or invest 50% or more of the aid in projects aimed at lowering their emissions.
The EC stressed that the Polish scheme is appropriate and necessary to support energy-intensive companies and prevent relocation of pollution outside the EU. The body added that the scheme is in line with EU rules and stressed that aid will not have excessive negative effects on trade and competition in the bloc.
The Commission reminded that it introduced the Green Deal at the end of 2019 with the aim of making the EU climate-neutral by 2050. It added that the ETS is an important tool for lowering greenhouse gas emissions and noted that EU Parliament and Council adopted regulations according to which the bloc has to cut greenhouse gas emissions 55% by 2030 compared to levels from 1990.
