State aid - is Europe trying to solve the wrong problem?
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State aid - is Europe trying to solve the wrong problem?

The European Union has announced the relaxation of state financial aid and other rules for green technologies, in an apparent reply to the US IRA subsidies. But what if the issue isn’t financial aid, what if it's something else.

Summary: The European Union has announced the relaxation of state financial aid and other rules for green technologies, in an apparent reply to the US IRA subsidies. But what if the issue isn’t financial aid? What if it's something else?

Why this is important: The amount of finance available is only piece of the puzzle. Having the other resources and a clear process for execution are also key.

The big theme: Europe wants to decarbonise its economy. This includes sectors as diverse as transport, our buildings, our food, and of course our industry. Working out how to do this is a big challenge. There are good reasons why many of these sectors currently use fossil fuels, so decarbonisation is going to need a lot of government assistance. But how best to provide it?



The details


Summary of a article from Euractiv

In a well leaked move, the European Commission on Thursday (9 March) relaxed state aid rules for green technology that helps reduce carbon emissions, in its bid to counter the threat to European industry from US and Chinese subsidies. The EU’s new Temporary Crisis Framework for state aid allows national governments to subsidise “the manufacturing of strategic equipment” such as solar panels, batteries, heat pumps, and electrolysers as well as the production of key components and related critical raw materials.

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