20 April 2023

Dutch scheme battling increased energy costs 

In March 2023, the European Commission has approved a new €1.4 billion Dutch scheme. The point is to support energy-intensive small and medium-sized enterprises facing increased energy costs in the context of Russia’s war against Ukraine. The scheme was approved under the State aid Temporary Crisis and Transition Framework to foster support measures in sectors which are key to accelerate the green transition and reduce fuel dependencies.  

Direct grants to support the Dutch enterprises

The Netherlands notified to the Commission, under the Temporary Crisis and Transition Framework, a €1.4 billion scheme to support energy-intensive SMEs facing increased energy costs in the context of Russia’s war against Ukraine. 

  • The aid will take the form limited amounts of aid in form of direct grants. 

The purpose of the scheme is to cover part of the increased costs of natural gas and electricity and to mitigate their impact on those companies currently unable to cope with them. It will be available for: 

  • SMEs across sectors; 
  • active in the Netherlands;  
  • whose purchases of natural gas and electricity amount to at least 7% of their annual turnover; 
  • for year 2022. 

Credit or other financial institutions are excluded from the scheme. Each potential beneficiary will be entitled to receive an aid amount covering 50% of the eligible costs, up to a maximum of €160,000. 

In more detail, the aid: 

  • Will not exceed €250,000 per company active in the primary production of agricultural products, €300,000 per company active in the fishery and aquaculture sectors and €2 million per company active in all other sectors; a 
  • And will be granted before 31 December 2023. 

More about the new Framework 

On 9 March 2023, the Commission adopted a new Temporary Crisis and Transition Framework to foster support measures in sectors which are key for the transition to a net-zero economy, in line with the Green Deal Industrial Plan. Together with the amendment to the General Block Exemption Regulation (‘GBER’) that the Commission endorsed on the same day, the Temporary Crisis and Transition Framework will help speed up investment and financing for clean tech production in Europe. It will also assist Member States in delivering on specific projects under National Recovery Plans which fall within their scope. 

The new Framework amends and prolongs in part the Temporary Crisis Framework, adopted on 23 March 2022 to enable Member States to use the flexibility foreseen under State aid rules to support the economy in the context of Russia’s war against Ukraine. The Temporary Crisis and Transition Framework provides for the following types of aid, which can be granted by Member States: 

  • Limited amounts of aid, in any form, for enterprises affected by the current crisis or by the subsequent sanctions and countersanctions up to the increased amount of €250,000 and €300,000 in the agriculture, and fisheries and aquaculture sectors respectively, and up to €2 million in all other sectors; 
  • Liquidity support in form of State guarantees and subsidised loans. In exceptional cases and subject to strict safeguards, Member States may provide to energy utilities for their trading activities public guarantees exceeding 90% coverage, where they are provided as unfunded financial collateral to central counterparties or clearing members. 
  • Aid to compensate for high energy prices. The aid, which can be granted in any form, will partially compensate enterprises, in particular intensive energy users, for additional costs due to exceptional gas and electricity price increases.  
  • Measures accelerating the rollout of renewable energy. Member States can set up schemes for investments in all renewable energy sources, including renewable hydrogen, biogas and biomethane, storage and renewable heat, including through heat pumps, with simplified tender procedures that can be quickly implemented, while including sufficient safeguards to protect the level playing field.  
  • Measures facilitating the decarbonisation of industrial processes. To further accelerate the diversification of energy supplies, Member States can support investments to phase out fossil fuels through electrification, energy efficiency and the switch to the use of renewable and electricity-based hydrogen which complies with certain conditions, with expanded possibilities to support the decarbonisation of industrial processes switching to hydrogen-derived fuels.  
  • Measures aimed at supporting electricity demand reduction 
  • Measures to further accelerate investments in key sectors for the transition towards a net-zero economy, enabling investment support for the manufacturing of strategic equipment, namely batteries, solar panels, wind turbines, heat-pumps, electrolysers and carbon capture usage and storage as well as for production of key components and for production and recycling of related critical raw materials.Sanctioned Russian-controlled entities will be excluded from the scope of these measures. 

Measures particularly important to accelerate the green transition and reduce fuel dependencies will be in place until 31 December 2025. This concerns in particular measures accelerating the rollout of renewable energy and energy storage, measures facilitating the decarbonisation of industrial processes and measures to further accelerate investments in key sectors for the transition towards a net-zero economy. 

FI Group can provide valuable support to enterprises of all sizes looking to optimize their R&D financing strategy. By helping to assess R&D needs, identify funding sources, develop a financing strategy, support the application process, and monitor and evaluate R&D activities, our expert consutlants can help ensure that the enterprise is making the most effective use of available resources to achieve its strategic objectives. 

Yvette Poumpalova

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