Brussels approves German aid

08/11/2023

Source: Energy & Management Powernews

Germany may distribute billions in subsidies to energy-intensive companies. With millions in government subsidies, the charging infrastructure can be expanded

The federal government may, on the one hand, generously support energy-intensive companies and, on the other hand, provide 350 million euros in subsidies for the expansion of charging infrastructure.

As the EU Commission announced in Brussels, the German government may spend up to 6.5 billion euros to compensate energy-intensive companies for the costs arising from emissions trading (ETS). This would prevent these companies from relocating parts of their production abroad (carbon leakage), according to a Commission statement. It concerns industries, which are listed in the "carbon leakage list of the EU", like the manufacturers of cement or glass and glass fibers.

They are exposed to a particularly strong, international competition, lead the commission to the reason. The aid takes the form of partial compensation for the additional costs in the respective previous year until 2030, so that the last payments would be due in 2031. Depending on the emissions intensity of the products, the compensation can reach between 65 and 95 percent of the additional costs.

The amount of compensation is not based on the actual additional costs, but on standards (benchmarks) that take into account the state of the art. This is intended to create an incentive to use lower-emission technology. Care has also been taken to ensure that the aid does not unduly affect competition, said the EU commissioner responsible, Margrethe Vestager.

Nearly 1,000 high-power charging stations

The Commission also approved aid of 350 million euros, for the installation of fast-charging stations on German autobahns. There, 952 so-called High-Power Chargings (HPC) are to be installed at 200 rest areas. The aid is available in the form of grants for both the investment and the ongoing operation of the infrastructure. All companies that participate in the construction and operation can profit from this. The selection is made by a public tender of the projects.

The German subsidies are "necessary and appropriate" to expand the infrastructure for electromobility on a broad basis, it says in justification in Brussels. They contribute to the EU achieving its climate goals, it said, because the investments would not be made without the aid. At the same time, the subsidies would be limited to the minimum necessary to affect competition as little as possible. He added that the German government had also promised that the prices for charging vehicles at subsidized HCPs would be based on the general price level in this market.

The " Carbon Leakage List of the EU " can be downloaded from the Internet.

Author: Tom Weingärtner