Investment aid to highly efficient power plants, including new power plants which are CCS-ready
Saturday, 31 December 2011 13:04


 

Investment aid granted between 1 January 2013 and 31 December 2016 for new highly efficient power plants shall be considered compatible with the internal market within the meaning of Article 107(3)(c) TFEU provided the following conditions are met:


• the new highly efficient power plant exceeds the efficiency reference value of the power plants set out in Annex I to Commission Decision 2007/74/EC9 or the relevant efficiency reference value in force when the aid is granted. This condition cannot be considered fulfilled for new highly efficient power plants which merely comply with the existing efficiency reference values; and


• the final investment decision to construct the plant is taken between 1 January 2013 and 31 December 2016.


Objective and necessity of the aid


Member States must demonstrate that the aid targets a market failure by having a substantial impact on the environmental protection. Aid must have an incentive effect in that it results in a change in the behaviour of the aid beneficiary; that incentive effect may be shown through a counterfactual scenario providing evidence that without the aid the beneficiary would not have undertaken the investment.

Moreover, the final investment decision for the new power plants has to be taken during the period 2013-2016.


Eligible costs


The eligible costs will be limited to the total costs of investment in equipment and land in the new installation which are strictly necessary for the construction of the new power plant. In the case of construction of a CCS-ready power plant, the costs of demonstrating the overall economic and technical feasibility of implementing a full CCS chain, as well as investment costs in the power plant and land that will allow for cost efficient retrofit with CO2 capture equipment will be eligible. The costs of installing capture, transport and storage equipment will not be considered eligible costs, since aid for CCS implementation does not fall within the scope of these Guidelines.


Maximum aid intensities


For new highly efficient power plants that are CCS-ready and implementation of the full CCS chain starts before 2020, the aid must not exceed 15 % of the eligible costs.


For new highly efficient power plants which are CCS-ready and for which aid is granted after a genuinely competitive bidding process (based on clear, transparent and non-discriminatory criteria) that favours (i) the most environmentally-friendly power generation technologies in the new plant resulting in lower CO2 emissions compared to the state-of-the-art technology and (ii) competition on the electricity generation market, the aid must not exceed 10 % of the eligible costs. Such a bidding process must be non-discriminatory and provide for the participation of a sufficient number of undertakings. In addition, the budget related to the bidding process must be a binding constraint, in the sense that not all participants can receive aid.


For new highly efficient power plants, irrespective of whether they are CCS-ready, for which implementation of the full CCS chain does not start before 2020, the aid must not exceed 5 % of the eligible costs.

 

 

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