Romania: European Commission approves green certificate reduction

The European Commission has agreed that partial compensation for the cost of financing renewable energy support in Romania is necessary, in line with EU state aid rules. The Commission found that the Romanian green certificate reduction scheme, reducing the contributions of certain energy-intensive users to the financing of renewable energy, is in line with its rules, and in particular with the Commission's new Energy and Environmental Aid Guidelines (see IP/14/400 and MEMO/14/276). Financial support will ensure the competitiveness of energy-intensive industries without unduly distorting competition in the Single Market.

Commission Vice President in charge of competition policy Joaquín Almunia said: "The Romanian scheme enables companies that are both electro-intensive and exposed to international trade to remain competitive without unduly distorting competition in the Single Market. It will support Romania in reaching its 2020 climate targets whilst at the same time appropriately addressing the risk of carbon leakage."

This response dates back to notification from Romania in July 2014 that it planned to reduce the contribution to the financing of renewable energy for certain companies active in sectors with particularly high electro-intensity and trade exposure. The beneficiaries will pay 85%, 60% or 40% less RES support if they demonstrate an electro-intensity of more than 20%, between 10% and 20%, or between 5% and 10%, respectively. The beneficiaries would also need to show that they (1) do not record debts to the general consolidated budget of the state; (2) carry out energy audits and implement measures to improve their energy efficiency; (3) do not lay off more than 25% of the employees and maintain activities in the European Economic Area; and (4) conclude partnerships with educational institutions in order to narrow the theory-practice gap, increase professional level and attract skilled personnel.

The Commission investigated and found that reductions are limited to companies active in sectors recognised by the guidelines as being both energy-intensive and exposed to international trade. The additional conditions to select eligible beneficiaries are objective, transparent and do not discriminate between companies that are in a similar factual situation. The green certificate reduction scheme will enter into force on 1 December 2014 and will expire on 31 December 2024. The yearly budget is estimated at around €75 million with approximately 300 beneficiaries.

For more information see the Commission's policy brief on its new Energy and Environmental Aid Guidelines.

Adapted from press release by Katherine Guenioui

Read the article online at: https://www.worldcement.com/europe-cis/16102014/romania-european-commission-approves-green-certificate-reduction-679/