PP 40/19European Guidelines for Member States on State Aid in Compensation for Indirect Emission Costs

This publication was reviewed in March 2019 and revalidated without modifications.

The EU Emission Trading Scheme phase 3 will start on January 1, 2013. The Power industry will have to purchase CO2 allowances to cover the CO2 emissions of their plants. Consequently, electricity prices may be increased by the cost of CO2 allowances.

In May 2012, the European Commission published State aid guidelines for Member States who wish to compensate energy intensive industries, particularly exposed to the international competition, for rises in electricity prices as a result of EU ETS.

The guidelines do not consider that the industrial gas sector should be eligible for state aid as a result of indirect emission costs. They do however recognise the principle that both outsourced and insourced production of industrial gases should be treated equally.
In December 2012 several Member States have decided to provide State aid to energy intensive industries affected by indirect emissions costs.

The attached position paper makes explicit the principle of equal treatment in the case of industrial gases industry. The position paper should be used by National Industrial Gases Associations in case of local deviation from the European guidelines.