EU competition regulators have granted authorization to a €2.9 billion Spanish and €1.4 billion Czech scheme designed to compensate companies that have faced increased electricity prices due to indirect emission costs under the EU Emissions Trading System (ETS). The approved aid will be capped at 75% of the incurred indirect emission costs.
The primary objective of these measures is to mitigate the risk of carbon leakage, wherein companies relocate their operations to regions with less stringent emission regulations. The approved schemes enable eligible companies to receive partial refunds, reimbursing them for up to 75% of the indirect emission costs they incurred in the preceding year. The final payments will be made in 2031.
By providing financial support, these schemes aim to alleviate the economic burden on affected companies while promoting the transition towards lower-carbon practices. The EU's approval of these compensation schemes represents a significant step in addressing the challenges faced by industries impacted by indirect emission costs.
