The European Commission has approved, under EU State aid rules, a Romanian scheme to partially compensate energy-intensive companies for higher electricity prices resulting from indirect emission costs under the EU Emission Trading System (ETS).
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The scheme notified by Romania, with a total estimated budget of €1.5 billion, 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.
The support measure is aimed 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, with the final payment to be made in 2031.
The maximum aid amount will be equal to 75 % of the indirect emission costs incurred. The aid amount is calculated based on electricity consumption efficiency benchmarks, which ensure that the beneficiaries are encouraged to save energy.
In order to qualify for compensation, beneficiaries have to either implement certain energy audit recommendations, cover at least 30% of their electricity consumption with carbon-free sources (through on-site or near-site renewable energy generation facilities, carbon-free power purchase agreements or guarantees of origin), or invest at least 50 % of the aid amount in projects leading to substantial reductions of their installations' greenhouse gas emissions.
Beneficiaries will have to comply with one of those obligations within three years from the granting of the aid.
Romania also notified an amendment to a previous scheme to partially compensate energy-intensive companies for higher electricity prices resulting from indirect emission costs incurred in the period 2019-2020.
The previous scheme was approved by the Commission in May 2020 (SA.56403). By this amendment, Romania extends the deadline for the payments of the aid for year 2020 until 2022, in view of delayed payments due to an exceptionally high sickness rate in the context of the coronavirus pandemic. ■