State Aid

COMMISSION FURTHER EXTENDS SUPPORT FOR ENERGY PRICE INCREASES

The Commission has partially postponed the end of measures under the Temporary Crisis and Transition Framework (the “Framework”) to compensate for higher energy costs. Member states can continue to grant limited compensation until 30 June 2024. Other measures under the Framework, such as state guarantees and loans will expire on 31 December 2023 and supports to assist with decarbonisation and independence from fossil fuels will expire on 31 December 2025. Further information is available here.

COMMISSION PROPOSES ADOPTING AMENDMENTS TO IRELAND’S RECOVERY AND RESILIENCE PLAN

The Commission has proposed that the Council of the European Union adopt amendments to Ireland’s national recovery and resilience plan (“RRP”). The revisions are to the RRP first approved in 2021 under the Recovery and Resilience Facility, which covers investments in drinking water, wastewater infrastructure, renewables, energy storage, energy efficiency and public charging points. Specific changes include focusing on supporting fewer but larger-sized projects to reduce CO2 emissions and extended timelines to develop Cork commuter rail and a shared government data centre. Further information is available here.

MEASURES TO SUPPORT ITALIAN RAILWAYS

The Commission approved intra-group transfers of railway assets between Italy’s state-owned railway holding company, Ferrovie dello Stato Group (“FS Group”), but found that compensation for rail freight transport to FS Group’s subsidiary Trenitalia constituted incompatible aid. The Commission determined that certain transfers of assets (including terminals, maintenance facilities and depots) free of charge were in line with market conditions. However, Italy will be required to recover subsidies for certain freight routes. The routes were deemed incompatible as Italy had either not sufficiently defined the nature of the public service obligations or had not established a market failure. Further information is available here.

MEASURE TO SUPPORT RENEWABLE ENERGY

The Commission approved a €5.7 billion Italian scheme to support the production and self-consumption of renewable electricity. In line with the European Green Deal and its 2022 guidelines, the scheme will be made available in part through the Recovery and Resilience Facility. The scheme will support constructing and expanding power generation installations, with capacities of up to 1 MW. The Commission determined the measure is necessary for Italy to meet its European and national environmental targets. Further information is available here.

MEASURE TO SUPPORT AUSTRIAN ENERGY COSTS

In line with the Temporary Crisis and Transition Framework, the Commission has approved a €3 billion Austrian state aid scheme to support companies’ increased energy costs. The aid will consist of direct grants and will be open to all types of companies, with limited exceptions. Energy-intensive companies will be entitled to the highest amount of aid. Companies receiving higher aid amounts will be subject to recommendations from mandatory energy audit reports. Further information is available here.