Guidelines on new energy state aid changes

These have been produced to help member states to design state aid measures that contribute to reaching their 2020 climate targets and provide sustainable and secure energy, while being cost-effective for society and without causing distortions of competition or a fragmentation of the Single Market.

In relation to renewable energy sources and their growing share of electricity generation, coupled with the falling production costs associated with maturing technologies, the guidelines aim to move away from fixed, feed-in tariffs and subsidy schemes which insulate against the realities of market forces as experienced by other sources.

In a move expected to reduce the cost to governments of renewables subsidy schemes, member states will henceforth be required to gradually move towards feed-in premiums. They will also need to place a greater emphasis on auctioning, and a technology-neutral approach through the use of competitive bidding (although smaller installations or technologies in an early stage of development will continue to be able to benefit from the current regime and may even avail of any form of aid including feed-in tariffs).

Some flexibility to take account of national circumstances will also be granted. This move follows the March Council meeting of Energy and Environment Ministers and the European Council summit of EU Leaders, where strong opposition to previously-proposed changes to renewable energy subsidies was voiced. Details: