Foreign
THE European Commission has announced that Germany will support businesses to the tune of 27.5 billion euros (27.6 billion U.S. dollars) in subsidies with high energy costs.
EU Competition Commissioner, Margrethe Vestager said in a statement that the subsidy scheme allows Germany “to reduce the impact of indirect emission costs on its energy intensive industries as a result of the EU Emission Trading System (ETS).
ETS, the European Union’s carbon pricing scheme, set up in 2005 and recently scaled up, makes high-polluting sectors like power plants and industry buy permits for the emissions they produce.
The aim of the scheme is to reduce the risk of companies relocating out of the bloc to countries with less ambitious climate polices and increasing carbon emissions globally, according to the commission.
Subsidies are to part cover the cost of higher energy prices as a result of the increased costs of electricity generation due to the impact of carbon prices.
A partial refund is to be issued to companies up to 75 per cent of the increased costs incurred, with some limitations, and calculated using energy consumption benchmarks to encourage efficiency.
The commission said companies must cover 30 per cent of their energy consumption from renewable sources and make further investments from 2023 onwards, worth 50 per cent of the aid amount, to boost energy efficiency and decarbonise operations. (dpa/NAN)
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Tags: Emission Trading System European Commission Margrethe Vestager
