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The European Commission has proposed a clampdown on EU countries’ ability to subsidise clean-tech companies, in a move that is likely to inflame tensions between smaller countries and powerhouses like France and Germany.
According to a draft document seen by Euractiv, Brussels wants to halve the generous industrial subsidy limits temporarily imposed during the COVID pandemic and subsequent energy crisis.
This means capping subsidies at €75 million per project in rich regions, and €175 million for ones in the bloc’s poorest corners, from €150 million and €350 million respectively.
The new state aid guidelines, entitled the “Clean Industry State Aid Framework”, also sets out the particular sectors that are eligible for state subsidies. These include batteries, solar panels, wind turbines, heat pumps, electrolysers, and carbon capture.
The Commission will also allow subsidies for the “production or recovery” of critical raw materials needed for these technologies.
The draft document was obtained by Euractiv hours after Berlin demanded that the current state-aid framework should be continued as part of the bloc’s bid for shares in clean-tech production.
A similar controversy came to blows in 2023, when the Germans interceded after Brussels circulated a first version of the then new temporary rules, which saw the limits increased significantly.
Green Deal Commissioner Teresa Ribera has previously said the EU needed to go “farther and further” on subsidies for clean industry, while also stressing the need to avoid a subsidy race between smaller EU countries and big ones.
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Energy News Beat