This Friday, the European Commission decided to extend until December 2023 the time frame for easing state aid rules for European Union (EU) member states to support the economy due to the energy crisis, as well as to increase flexibility.
In a statement, the Community Executive announces that it has adopted, after consultation with the EU countries, “an amendment to the crisis timeframe to allow Member States to continue to use the flexibility provided by state aid rules to support the economy in the context of Russia’s war against Ukraine”, which aggravated energy crisis in the Community block.
These more flexible rules are expected to be in effect until December 31, 2023, and this extension is “without prejudice to the possibility of authorizing other necessary and proportionate measures,” Brussels guarantees.
In addition to extending the time frame for the crisis, state aid was also changed by this Friday’s decision, which then allows countries to support companies operating in the agriculture sectors with 250 thousand euros, fisheries and aquaculture with 300 thousand euros, and the rest up to two million euros.
At the same time, Member States are given additional flexibility to maintain the liquidity of public energy services and provide assistance to companies hit by rising energy prices, subject to safeguards.
New measures have been added to support the reduction in electricity demand, taking into account the approved goal of reducing consumption by countries (by 10% in general and by 5% during peak hours).
In a statement also released today, Margrethe Vestager, Executive Vice President of the European Commission and Head of Competition Portfolio, stresses that the decision “gives Member States more flexibility to create support schemes tailored to the needs of their economies, while continuing to encourage a green transition, while maintaining assurance that aid remains targeted and proportionate.”
“Overall, we have extended the application of the system until the end of 2023 in order to continue the crisis, giving Member States more predictability and time to implement support schemes and providing a stable legal basis for companies,” says Margrethe. Vestager.
So, in addition to increasing aid ceilings and allowing liquidity support, the community executive is advocating aid to offset high energy prices as well as green investment.
In March 2020, due to the economic impact of the pandemic, the European Commission adopted a temporary framework for facilitating state aid, an initiative that expanded the support that member states can provide to their economies, normally prohibited by EU competition rules, such as loans with state guarantees, grants, etc. .
In the meantime, this provisional structure has spawned another, adopted in March 2022 in the context of the war in Ukraine sparked by the Russian invasion last February.
Geopolitical tensions over the war in Ukraine have affected the European energy market, not least because the EU is dependent on Russian fossil fuels such as gas and fears supply cuts this fall and winter.
Author: Lusa
Source: CM Jornal
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