Under EU State aid rules, European Commission has approved a Polish scheme to partially compensate energy-intensive companies for higher electricity prices resulting from indirect emission costs under the EU Emission Trading System (‘ETS’).

The scheme notified by Poland, with a total estimated budget of €10 billion (PLN 45 435 million), will cover part of the higher electricity prices arising from the impact of carbon prices on electricity generation costs (so-called ‘indirect emission costs’) incurred between 2021 and 2030.

The compensation will be granted to eligible companies through a partial refund of the indirect emission costs incurred in the previous year, with the final payment to be made in 2031. The maximum aid amount per beneficiary will be equal to 75 % of the indirect emission costs incurred.

The additional aid granted to limit the remaining indirect emission costs will not exceed one third of the regular compensation based on the 75 % aid intensity.

In order to qualify for compensation, beneficiaries have to either (i) implement certain energy audit recommendations, (ii) cover at least 30% of their electricity consumption with renewable energy sources (i.e. guarantees of origin, renewable power purchase agreements or renewable electricity self-generation facilities), or (iii) invest at least 50 % of the aid amount in projects leading to substantial reductions of their installations’ greenhouse gas emissions.

Source: State aid: Commission approves €10 billion Polish scheme to compensate energy-intensive companies for indirect emission costs