EU consults on decarbonisation, clean tech aid

: Biofuels, Biomass, Emissions, Hydrogen
25/03/11

The European Commission has opened a consultation on updates to its state aid rules, which aim to take into account the bloc's proposed clean industrial deal — designed to simplify and speed decarbonisation.

The commission is aiming to publish the rules in June, following input from EU states. The updated state aid rules would then apply to how the commission decides on EU states' financing of projects up until the end of 2030. The draft provides for member states' simplified tender procedures for renewables and energy storage. The commission specifically notes the possibility of granting aid without tender for less mature technologies, such as renewable hydrogen.

There would also be more flexibility for EU states aiding industrial decarbonisation, with a choice of tender-based schemes, direct support and new limits for very large projects. The commission lists batteries, solar panels, wind turbines, heat-pumps, electrolysers and carbon capture usage and storage among clean technologies that can be supported, as well as their key components and critical raw materials. Officials note the possibility of EU countries de-risking private investment.

The rules, when adopted, would also allow for investment in storage for renewable fuels of non-biological origin (RFNBOs), biofuels, bioliquids, biogas, biomethane, and biomass fuels as long as they obtain at least 75pc of their content from a directly connected and related production facility. Aid can only be granted for biofuels, biogas, and biomass fuel production if compliant with the bloc's renewables directive.

While the rules for biofuels are not new, they do reflect the wider scope of aid now foreseen by the commission. And officials say the rules allow for projects in the EU to receive aid from a member state if a comparably project would receive aid in a third country.

The commission released its proposed clean industrial deal in late February. The deal targets a simplification of rules, to allow EU member states to aid industrial decarbonisation, renewables rollout, clean tech manufacturing and de-risking private investments. Today's consultation runs until 25 April.

By Dafydd ab Iago

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