MIL-OSI Europe: MOTION FOR A RESOLUTION on the climate, energy and environmental State aid guidelines (CEEAG) – B9-0537/2021


Source: European Parliament


European Parliament resolution on the climate, energy and environmental State aid guidelines (CEEAG)


The European Parliament,

 having regard to its resolution of 28 November 2019 on the climate and environment emergency[1],

 having regard to Article 107 of the Treaty on the Functioning of the European Union (TFEU),

 having regard to the Commission’s State aid Temporary Framework of 19 March 2020,

 having regard to the draft Commission communication entitled ‘Guidelines on State aid for climate, environmental protection and energy 2022’,

 having regard to the Commission communication of 17 September 2020 entitled ‘Stepping up Europe’s 2030 climate ambition – Investing in a climate-neutral future for the benefit of our people’ (COM(2020)0562),

 having regard to the Commission communication of 11 December 2019 on the European Green Deal (COM(2019)0640),

 having regard to the Paris Agreement of the 21st Conference of the Parties (COP21) to the United Nations Framework Convention on Climate Change, and to the 11th Conference of the Parties serving as the Meeting of the Parties to the Kyoto Protocol, held in Paris, France from 30 November to 11 December 2015,

 having regard to the Commission communication of 14 July 2021 entitled ‘“Fit for 55”: delivering the EU’s 2030 climate target on the way to climate neutrality’ (COM(2021)0550),

 having regard to the Commission’s evaluation of EU State aid rules,

 having regard to the public consultation on the revised climate, energy and environmental aid guidelines (CEEAG),

 having regard to Rule 132(2) of its Rules of Procedure,

A. whereas according to Article 107 TFEU, the Commission may only consider State aid compatible with the single market in order to facilitate the development of certain economic activities within the European Union, where such aid does not adversely affect trading conditions to an extent contrary to the common interest; whereas this narrow definition leaves very limited options for public investment and State aid to play a constructive role in the necessary transition towards an environmentally and socially sustainable society;

B. whereas due to the COVID-19 pandemic, the State aid framework has been temporarily adapted, allowing for more types of State aid to be granted in order to meet certain objectives;

C. whereas the climate and environmental emergency is already affecting every region in the world and will increasingly do so with consequences much more severe than the COVID-19 pandemic has had until now;

D. whereas the rules on State aid for climate, energy and environmental projects should be fit for the sustainable transition and should be in line with the climate, energy, zero-pollution and biodiversity goals and ambitions of the EU in this regard;

E. whereas the current 2014-2020 guidelines on State aid for environmental protection and energy (EEAG) will expire on 31 December 2021;

F. whereas a fundamental review of the EEAG is required in order to fully align the guidelines with the European Green Deal, the UN Sustainable Development Goals, the Paris Agreement and the EU’s 2030 and 2050 climate goals;

G. whereas the EEAG set out the conditions under which State aid for energy and environmental protection may be considered compatible with the single market;

H. whereas the EU’s energy and climate objectives present unprecedented challenges that will require enormous levels of public investment; whereas inaction in this field would be more costly as failing or delaying investments to achieve the ecological transformation could cost the EU up to 5.6 % of its GDP in 2050;

I. whereas the European Green Deal communication specifically stipulates that State aid rules should be revised to reflect the European Green Deal’s objectives, support a cost-effective transition to climate neutrality by 2050 and facilitate the phasing out of fossil fuels, in particular those that are most polluting;

J. whereas the list of sectors eligible for State aid has been significantly reduced in the Commission’s draft CEEAG;

K. whereas on 7 June 2021, the Commission launched a targeted public consultation and published a draft communication entitled ‘Guidelines on State aid for climate, environmental protection and energy 2022’;

L. whereas the Commission has stated that the two main drivers of the CEEAG revision are an enlargement of the scope of the guidelines to new areas and all technologies that can deliver the European Green Deal and greater flexibility in compatibility rules; whereas alignment and consistency with relevant EU environmental and energy legislation and the existing EU acquis is essential;

M. whereas in order to set the EU on a responsible path to becoming climate-neutral by 2050 at the very latest, the European Climate Law[2] stipulates that greenhouse gas emissions must be cut by at least 55 % by 2030 compared to 1990 levels; whereas the 2030 target is not enough to align the EU’s policies with the Paris Agreement and more efforts are needed;

N. whereas the Commission has stated that these climate and energy targets will require EUR 350 billion of additional annual investment;

O. whereas State aid rules and in particular those for climate, energy and environmental protection should not support fossil fuels, cause or create any lock-in effects or stranded assets or support nuclear energy production; whereas State aid rules must not undermine efforts to protect and restore biodiversity within the EU or in non-EU countries;

P. whereas the revision of the CEEAG should take into consideration social aspects so as to counter disproportionate and unintended social consequences and inequalities, bearing in mind that 30 million people or 6.9 % of the EU population live in energy poverty, with marked differences among Member States;

Q. whereas according to the case law of the Court of Justice[3], if a State aid measure under Article 107 TFEU entails a violation of EU law on the environment, that State aid measure cannot be declared compatible with the single market;

R. whereas the Aarhus Convention Compliance Committee, whose findings[4] were delivered on 17 March 2021, found that the EU was in breach of the Aarhus Convention[5] because of its failure to provide access to administrative or judicial procedures for members of the public wishing to challenge decisions on State aid measures taken by the Commission;

S. whereas the Commission should establish clear guidelines to facilitate the assessment of the compatibility of State aid with relevant provisions of EU law, including EU law relating to the environment;

1. Notes the Commission’s draft communication on the CEEAG and its efforts to strengthen the EEAG and to aim at a higher level of environmental protection, including the decarbonisation of the energy sector; welcomes the increased focus on fighting climate change and reducing greenhouse gas emissions in the draft CEEAG, and underlines that these guidelines should go hand in hand with environmental and health protection;

2. Recalls the EU’s climate objective of reducing emissions by at least 55 % by 2030 as laid down in the European Climate Law, and the target of reaching climate neutrality by 2050 at the latest, and considers this to be insufficient to contribute in a way that is equitable to the Paris Agreement goal of limiting global heating to 1.5 °C; points out that the transition to a climate-neutral economic model requires significant public investment and rapid, far-reaching and unprecedented transformations of all sectors, as noted by the Intergovernmental Panel on Climate Change;

3. Upholds that environmentally sustainable State aid is key to meeting the EU’s climate, biodiversity and energy objectives; believes that the Commission should send a clear signal that any support should be compatible with the Paris Agreement and the EU’s green transition and social objectives;

4. Highlights the need to mainstream the EU’s environmental and energy legislation and policies in the new State aid framework while ensuring that it remains up-to-date and in line with the updated climate and energy framework currently under revision;

5. Welcomes the general objectives of extending the scope of the CEEAG to cover new areas such as clean mobility, increasing flexibility and streamlining current rules; notes, however, that more can be done on State aid for climate, environmental protection and energy projects;

6. Stresses that the CEEAG should adequately support the ecological transformation of EU companies in the transition to a carbon-neutral economy, while protecting and restoring biodiversity and safeguarding the recovery from the COVID-19 crisis and job creation;

7. Recalls that the ecological transformation of EU economies is strongly dependent on public investment and public subsidies; stresses that the current State aid framework needs to be revised in order to take this reality into account and provide greater space for public investment and State aid aimed at building an environmentally and socially sustainable society;

8. Deplores the fact that the draft CEEAG would still allow State aid for fossil fuels; underscores the necessity of phasing out all fossil fuels as soon as possible; calls on the Commission to revise the different aid categories to exclude the possibility for Member States to provide any direct or indirect support for fossil fuels;

9. Deplores the fact that the draft CEEAG do not specify a timeframe within which aid could be provided for closing coal plants, implying that operators can ask for compensation even for very late closures if a country’s coal phase-out date allows for it; is also dismayed that the draft guidelines treat fossil gas more favourably than other polluting fossil fuels like coal, peat and oil shale;

10. Deplores the lack of stringent eligibility requirements that clearly prioritise renewable types of hydrogen over non-renewable ones; insists on clear eligibility criteria for hydrogen that exclude all hydrogen that is not from renewable sources;

11. Stresses that all activities that aim at achieving the necessary transition to an environmentally and climate sustainable society should as a general rule be exempt from the restrictions on State aid; stresses that State aid recipients need to comply with specific criteria, especially safeguarding employment and high labour standards;

12. Stresses that State aid can be an effective tool to address energy poverty and to freeze energy bills at their pre-crisis levels; believes that energy efficiency policies, especially in buildings, can contribute to eradicating energy poverty and that they should therefore be prioritised for the most vulnerable parts of society; expresses concern about the fact that the energy performance improvement criteria in the current draft CEEAG are not ambitious enough;

13. Underlines that the CEEAG are intended to clarify how Member States can incentivise early closures of coal, peat and oil shale activities; believes, however, that this aid category must be substantially improved by;

  1. immediately introducing clear safeguards in the phasing out of direct and indirect fossil fuel subsidies and setting mandatory closure dates by no later than 2025;
  2. requiring the presentation of a holistic impact assessment that estimates the cost of inaction and the impacts on future generations and makes comparisons with energy-efficient and more sustainable renewable alternatives to show that State aid is given to the most energy-efficient and sustainable long-term solution, in line with science and the European Green Deal objectives;

14. Stresses that in order to become climate-neutral by 2050 at the latest, the immediate and mass deployment of energy efficiency measures and sustainable renewable energy technologies is needed; stresses that public investment in energy efficiency and renewable energy will in the long term not only reduce emissions but also bring down and stabilise energy prices, thereby freeing up more disposable income and ultimately strengthening the EU’s prosperity and energy security; notes with concern that the draft CEEAG delete the aid category dedicated to supporting renewable energies and put them in competition for State aid with other low-carbon, hence fossil-based solutions; calls, therefore, for the final CEEAG to include a chapter on supporting renewable energies, and for it to underline that technology-specific support schemes should be the rule and not the exception, and to include dedicated provisions to support renewable energy communities and smaller actors, for example by exempting them from mandatory auctioning and/or ensuring the provisions are mainly in line with the Renewable Energy Directive[6];

15. Recalls the importance of the ‘energy efficiency first’ principle; insists on the integration into the CEEAG of the energy cascading principles, which put energy efficiency first, followed by renewable direct electrification and enhanced use of renewable heat from non-burning technologies and finally by the use sustainable renewable-based fuels or gases only for applications that do not have an alternative for their transition; asks the Commission to also revise the aid in the form of reductions on electricity levies for energy-intensive users in the light of these principles by ensuring that such support is linked to real investments in energy efficiency and renewable energies;

16. Underlines that not all Member States will be able to provide the same level of State aid to firms, creating the risk of increasing socio-economic disparities between countries and regions; calls, therefore, for a fundamental overhaul of the Stability and Growth Pact in order to allow for urgently needed public investment;

17. Stresses that investments in energy-efficient and renewable technologies require economic predictability in order to minimise investment risks; calls on the Commission to authorise aid schemes for a sufficiently long period that take into account the planning and development time frames of the relevant projects;

18. Calls on the Commission to ensure legal certainty; calls on the Commission to include a review mechanism in the new CEEAG;

19. Calls on the Commission to set a deadline of the end of 2023, beyond which time aid could not be provided for shutting down coal plants;

20. Believes that the ecological transition must be grounded in the protection of workers’ rights and a just transition for all; stresses the key importance of preserving and creating sustainable and quality jobs in the context of the sustainable transition;

21. Reiterates its call to the Commission to adopt guidelines to facilitate the assessment of the compatibility of State aid with relevant provisions of EU law relating to the environment, including on the information to be submitted by Member States when they notify the Commission of State aid, in order to comply with the requirements laid down in the Aarhus Convention;

22. Instructs its President to forward this resolution to the Commission and the Council. 


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