Competition

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General block exemption Regulation in the context of the European Green Deal

Summary
Evaluation
Commission Proposal
Legal Act
Implementation

Overall state of play

Commission proposal: ongoing
A public consultation on the proposed changes to the relevant General Block Exemption Regulation (“GBER”) provisions took place from 6 October to 8 December 2021 to collect stakeholders’ input on the proposed targeted amendment¹. Member States were also invited to share their comments on the GBER proposal during an Advisory Committee meeting in December 2021. A second Advisory Committee meeting will take place before the amendment is adopted.
Targeted GBER revision: adopted on 23 July 2021. The Commission adopted Regulation (EU) No 651/2014, in June 2014, declaring certain categories of aid compatible with the internal market in application of Articles 107 and 108 of the Treaty (OJ L 187 26.6.2014, p. 1). It is commonly referred to as the General Block Exemption Regulation.

State of play, main conclusions, outlook

The ongoing amendment of the GBER will provide new rules for State aid to promote the green and digital transition. It complements the parallel revisions of the Guidelines on regional aid, on aid for research, development and innovation, on risk finance aid and on aid for environmental protection and energy, by amending the relevant parts of the GBER.

The GBER lays down ex ante compatibility conditions on the basis of which Member States can implement State aid measures without prior notification to and approval by the Commission.

More specifically, the GBER revision aims at further facilitating green investments by widening the scope of block-exempted measures to cover aid for investments in new technologies, such as hydrogen and carbon capture and storage or usage, and for areas that are key to achieve the objectives of the European Green Deal, like resource efficiency and biodiversity and clean mobility. The GBER revision aims at further refining the provisions on aid for investments in flagship areas such as energy performance of buildings and recharging and refuelling infrastructure, which were already introduced as part of the targeted GBER revision in July 2021.

Estimated savings and benefits

One of the aims of the revision is to make the GBER rules more flexible with regard to the definition of eligible costs and aid intensities.

In particular, the GBER proposal simplifies the calculation of the eligible costs under a number of articles of section 7 on environmental protection and energy (e.g. Article 41) moving away from the counterfactual approach, which has been the subject of many GBER interpretation questions, suggesting that the concept is particularly difficult for Member States to apply. The GBER proposal provides, as an alternative to the competitive bidding requirement, for the possibility to support the investment costs with different aid intensities, thus further simplifying access to aid for beneficiaries.

For those provisions of the GBER that will still require the use of the concept of counterfactual scenario, the GBER proposal intends to provide clarity for Member States as to the various types of counterfactual scenarios that may be used to calculate eligible costs (e.g., Article 36, Article 38 and Article 47). By providing clearer rules, the GBER revision is expected to increase the efficiency of the rules, incentivising Member States to make the full use of the GBER where possible, and consequently lowering administrative burden linked to notifications.

In addition, the broadening of the scope of application of the GBER and the increase in the notification thresholds, allow Member States to implement more and larger projects without requiring an ex ante approval by the European Commission. This represents a simplification of the State aid rules in reducing the administrative burden for public authorities, which will facilitate the implementation of national measures contributing to the achievement of the Green Deal objectives.

¹ https://ec.europa.eu/competition-policy/public-consultations/2021-gber_en

State of Play

Fitness check of State aid rules concluded on 30 October 2020 (SWD (2020) 257)

Scope

The fitness check of State aid rules that concluded on 30 October 2020 covered a number of State aid instruments, including the GBER.

(Linked to the REFIT scoreboard fiche: Fitness check of 2012 State aid modernisation package, railways guidelines and short term export credit insurance)

Evaluation findings

The fitness check on the State aid modernisation package showed that the GBER rules for environmental protection and energy generally delivered on supporting climate targets while maintaining a competitive internal market, but that certain aspects should be revised to be fully up to the challenge of the Green Deal and the Recovery after COVID-19. In particular, around 30% of contributors to the targeted consultation identified the need for further clarification and simplification of the environmental and energy provisions of the GBER and the related EEAG provisions.

As part of the evaluation, an analysis of interpretation questions submitted by Member States also gave an insight on the provisions that were most problematic or unclear. In particular, the Commission uses an online tool accessible to Member States’ authorities to ask questions about the interpretation of the state aid modernisation rules (so-called "eWiki"). It constitutes a particularly important tool to ensure the consistent implementation of the GBER, as it is Member States’ responsibility to apply the GBER provisions directly. These interpretation questions have shown that certain provisions are not always clear. This is the case of provisions on eligible projects and costs, with specific reference to Article 38 on “Investment aid for energy efficiency measures”, Article 41 on “Investment aid for the promotion of energy from renewable sources”, Article 46 on “Investment aid for energy efficient district heating and cooling” and Article 47 on “Investment aid for waste recycling and re-utilisation”. In addition, a number of questions on the definition of the counterfactual investment were received across different articles.

The evaluation also showed, based among others on the data of the State aid Scoreboard, that certain provisions of the GBER were used sparingly or sub-optimally. This is the case, for instance, of Article 39 of the GBER, which aims to facilitate support to energy-efficiency projects in buildings through the use of financial instruments.

State of Play

On-going