The European Commission has approved a €60 million Croatian scheme to compensate some energy-intensive companies for higher electricity prices linked to carbon costs under the EU Emissions Trading System (ETS).
The support is designed for companies in sectors described as both highly energy-intensive and exposed to international competition, including iron and steel, paper and chemicals, the Commission.
Under the scheme, eligible firms can receive compensation covering up to 80% of so-called “indirect emission costs” incurred between 2025 and 2030, it said. Indirect emission costs refer to higher electricity prices that reflect the cost of carbon under the ETS, a cap-and-trade system that requires certain polluters to pay for their emissions.
Payments will be made the year after the costs are incurred, with a final payment in 2031 for costs from the previous year, it added.
Conditions attached to the compensation
The Commission said the amount of aid will be calculated using benchmarks linked to electricity consumption efficiency.
To qualify, beneficiaries must meet at least one of several requirements: implement certain recommendations from an energy audit; cover at least 30% of their electricity consumption with carbon-free sources; invest at least 50% of the aid in projects that substantially cut greenhouse gas emissions at their installations; or invest at least 50% of the aid in new or modernised assets intended to reduce electricity system costs, according to the Commission.
The Commission said it assessed the measure under EU State aid rules and its ETS State aid Guidelines, which were amended in December 2025.
A non-confidential version of the decision will be published in the Commission’s State aid register under case number SA.123819 once confidentiality issues have been resolved, it added.
