This document is an excerpt from the EUR-Lex website
Document 52014XC0628(01)
State aid: environmental protection and energy
This summary has been archived and will not be updated, because the summarised document is no longer in force or does not reflect the current situation.
- Date of last review:
- 06/09/2019
- Initial creation date:
- 30/07/2015
- Summary code:
-
- 08.99.00.00 Archived summaries
- EUROVOC descriptor:
- Directory code:
-
- 08.60.00.00 Competition policy / State aids and other subsidies
- Summarised document(s):
- Author:
- Publications Office of the European Union
- Responsible entity(ies):
- Directorate-General for Competition
State aid: environmental protection and energy
SUMMARY OF:
Communication on Guidelines on State aid for environmental protection and energy 2014-2020
WHAT IS THE AIM OF THE GUIDELINES?
These European Commission guidelines are new rules on public support for environmental protection and energy to help renewable sources of energy enter the marketplace. Their aim is to support EU countries in reaching their 2020 climate targets while addressing the market distortions that may result from subsidies granted to renewable energy sources.
KEY POINTS
The EU’s 2020 targets include 3 climate targets, which are as follows:
- greenhouse gas emissions 20% (or even 30%, if the conditions are right) lower than 1990 levels;
- 20% of energy from renewables; and
- 20% increase in energy efficiency.
Moving towards market signals
In recent years, renewable energy sources have been heavily supported with fixed tariffs. This has encouraged the growth of renewables in the energy mix* and has put the EU on track to meeting its 20% renewables target.
However, this type of support has also sheltered the renewables sector from price signals (which, under normal circumstances, reflect supply-and-demand conditions) and has thus led to market distortions. In particular, electricity from renewable energy sources has been generated irrespective of the actual market demand. In fact, it has out-competed other forms of generation which have to rely solely on the market price to operate economically.
As renewable energy technologies mature and their production achieves a substantial market share, the sector will need to adapt to market signals (i.e. interpret market trends) and aid amounts should respond to falling production costs.
Limits
The new guidelines therefore aim to limit State aid support to what is truly necessary. This will be done partly by gradually moving from feed-in tariffs* to competitive bidding processes* for the allocation of public support. A pilot phase in 2015 and 2016 will allow EU countries to test competitive bidding procedures in a small share of their new electricity capacity.
Infrastructure
The new guidelines also include criteria for supporting energy infrastructure, focusing on projects that improve cross-border energy flows and promote infrastructure in EU’s less developed regions.
FROM WHEN DO THE GUIDELINES APPLY?
The guidelines have applied since 1 July 2014 and remain valid until the end of 2020.
BACKGROUND
For more information, see:
- Energy and environmental State aid guidelines — Frequently asked questions (European Commission).
KEY TERMS
MAIN DOCUMENT
Communication from the Commission — Guidelines on State aid for environmental protection and energy 2014-2020 (OJ C 200, 28.6.2014, pp. 1-55)
last update 06.09.2019