The European Commission has approved Austrian and Spanish state aid schemes worth a combined total of over €9 billion to compensate energy-intensive companies for higher electricity prices linked to carbon costs under the EU Emissions Trading System (ETS).
The ETS is the EU’s carbon market, where companies must buy permits for their greenhouse gas emissions, which can feed through into electricity prices, the Commission noted in a statement on Tuesday.
Austria’s scheme has a budget of up to €900 million and will be open to sectors described as both highly energy-intensive and exposed to international trade, including iron and steel, aluminium and other metal industries, paper and chemicals.
Support will be paid as a refund of up to 75% of “indirect emission costs” incurred in the previous year, with costs covered from 1 January 2025 to 31 December 2029 and final payments due in 2030.
Companies must invest at least 80% of the aid they receive into energy-efficiency or other decarbonisation measures — such as renewable electricity production or changes to reduce emissions in industrial processes — to qualify.
Spain scheme extended and aid intensity raised
For Spain, the Commission approved an amendment to an existing scheme first cleared in March 2022 and amended in November 2023, it said.
The updated Spanish scheme extends eligibility to companies in additional sectors listed in the annex of the amended ETS State aid Guidelines, and raises the maximum aid intensity to 80% from 75% for sectors already covered.
Spain’s scheme provides compensation through a partial refund of indirect emission costs incurred in the previous year, with final payments due in 2031, while the overall budget remains unchanged at €8.51 billion.
Non-confidential versions of the decisions will be published in the Commission’s state aid register under case numbers SA.121338 (Austria) and SA.122532 (Spain), once confidentiality issues have been resolved.
