BRUSSELS (dpa-AFX) - The path is now clear for an industrial electricity price designed to ease the burden on energy-intensive companies. With a new state aid framework, the EU Commission will, under certain conditions, allow direct government subsidies to lower electricity prices for energy-intensive businesses.

"It is a tool to advance climate protection, strengthen Europe's resilience, and ensure our industry remains globally competitive," said Competition Commissioner Teresa Ribera in Brussels.

The goal is to drive the transformation of industry towards climate neutrality without causing excessive harm to the economy. The subsidies are intended to support energy-intensive companies facing international competition during a transitional period.

The Commission explicitly refers to this as a bridging measure, until the energy transition progresses further and electricity prices, aided by the expansion of grids and renewable energy, return to internationally competitive levels.

Discounts with Caps and Clear Limits

Specifically, the new framework allows for a discount of up to 50 percent on the wholesale electricity price, though at most for half of a company's annual electricity consumption. Additionally, the subsidized price may not fall below €50 per megawatt hour.

The measure is also time-limited: subsidies can be granted to any one company for a maximum of three years and must end no later than the end of 2030. The "Handelsblatt" had already reported details on Monday.

Who Can Benefit

Only companies with high electricity needs for production and whose sectors are deeply involved in international trade are eligible for the electricity price subsidies. This dual requirement is intended to ensure that only firms facing intense global competition and high energy costs receive support.

In Germany, industries such as chemicals and steel are both large and energy-intensive, and are under particular pressure due to high energy costs. According to the Federal Statistical Office, production in energy-intensive industrial sectors has almost continuously declined since early 2022 and has performed significantly worse than the overall industry. In 2021, according to the Office, the five most energy-consuming industrial sectors employed nearly one million people.

The black-red federal government had agreed in its coalition contract to relieve energy-intensive companies with an industrial electricity price, provided EU state aid rules allowed it.

Subsidies Only in Exchange for Investments in Green Technologies

A central element of the new EU rules is that aid must be tied to investments in a more climate-friendly economy. The Commission wants to prevent companies from simply pocketing government subsidies without giving anything in return.

At least half of the state support must therefore be invested in specific projects aimed at modernizing operations and reducing companies' CO2 emissions.

Only new or modernized facilities are eligible for support. Furthermore, claims are excluded if the measures have already received funding from other sources.

According to the EU Commission, eligible investments may include, among others, the expansion of renewable energy, the establishment of electricity storage, measures to increase demand-side flexibility, efficiency improvements, and the use of electrolyzers to produce "green" or low-CO2 hydrogen. Under certain circumstances, support for gas and nuclear energy may also be possible.

Billions in Private Investment Expected

With the new framework, the Commission aims not only to provide short-term relief but also to send a long-term investment signal. State aid is intended to strategically close gaps and, above all, mobilize private investment./mxx/DP/stw