• Review of EU Guidelines on State Aid for Environmental Protection

• Consultation paper Environmental and Energy Aid Guidelines 2014 - 2020

• Brigitta Renner-Loquenz, Head of Unit "State aids – Energy and Environment", Competition Directorate–General ,

European Commission

• Workshop Friday 12 April 2013–Albert Borschette

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Purpose of the consultation document

• Identify key areas for review

• Guide the debate with Member States, other stakeholders and experts

• => Your input is welcome!

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Review of EAG is part of SAM

1.More with less: re-launch growth by a more effective and efficient use of (scarcer) public finances (good vs. bad aid)

2.Simplify & target enforcement rules, according to competition threat and impact on the Single Market (GBER & GLs)

3.Clarify rules and improve procedures for faster decisions, based on a common economic approach, and better compliance

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State Aid for Environmental Protection and Energy

Aid can be granted on the basis of the

• Guidelines

• General Block Exemption Regulation (GBER)

• Directly under the Treaty

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Current rules Guidelines

Positive view of environmental aid like:

• Exceeding environmental standards

• Energy savings

• Renewable energy sources

• More efficient energy production

• Environmental taxes – exemptions

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General Block Exemption Regulation

• Simplified approach for a subset of measures (aid beyond standards, energy saving, investment aid RES/CHP, energy tax reductions)

• Aid below € 7.5 M no prior notification, presumed to be compatible

• Mainly used in 2011 for tax reductions

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Environmental aid expenditure

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2008 2009 2010 2011

Block-exempted aid 0.0 0.7 0.7 4.6

Total aid 13.7 15.1 14.7 12.4

Non- block-exempted

aid 13.7 14.4 14.0 7.8

under 2008

Guidelines 3 3.1 3.0 2.3

in € billion. State aid Scoreboard figures

Focus of the review

• Need for environmental measures continues –review allows simplification and adaptations

•

• Increasing interlinks between climate change measures and effects of aid on the functioning of internal energy market may require

• Widening of the scope of guidelines

• Modifications of compatibility criteria

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Challenges for the internal electricity market

• Lack of investment in (cross-border) infrastructure + pressure from (intermittent) RES and phasing out of conventional power plants on infrastructure

• intermittent RES causes concerns on stability of the network and generation adequacy.

• Risk of (further) fragmentation of internal energy market through national support measures, e.g. RES, capacity mechanism

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Main areas under review

1. Harmonise and simplify rules

2. Energy infrastructure

3. System stability and generation adequacy

4. Support to low-carbon energy sources

5. Exemptions from taxes and other charges

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1. Harmonise and simplify rules

• Explore simplification of rules for environmental measures (under GBER)

• Explore adding aid for less distortive measures under GBER

• Ex ante rules in EEAG for measures currently assessed under the Treaty (infrastructure)

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2. Energy infrastructure

• Infrastructure usually beneficial for achieving climate and energy objectives, usually positive for competition (downstream)

• What infrastructure supplied by market (no aid necessary)?

• Focus on cross-border infrastructure?

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3. System stability and generation adequacy

• Is there a market failure?

• How to limit potential distortions?

•Tendering?

•Technology neutral?

•Cross-border mechanisms?

•Limited in time?13

4. Renewable energy support schemes

• How to promote cost-efficient support schemes?

• How to make schemes more market oriented?

• Technology neutral tendering for mature RES?

• Specific support for less mature technologies?

• How to include cross-border supply?

• Support to other low-carbon energy sources?

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5. Exemptions from taxes and other charges

§ EAG: High energy taxes foster environmental protection. Well-targeted reductions can be necessary for competitiveness reasons§ Sound principle, simpler test to demonstrate

necessity?

§ Exemptions from financing of RES systems§ do they merit similar reflection? How to limit

distortive effects?

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Next steps

Comments may be sent until 30 April 2013

• via e-mail Stateaidgreffe@ec.europa.eu• Subject "HT 359 - Consultation on Community Guidelines

on State Aid for Environmental Protection"

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