Regulation allowing governments to provide state aid without notification to the European Commission must be improved to meet European Green Deal objectives

Brussels, 8 December 2021 – Greater clarity and more stringent criteria in the General Block Exemption Regulation (GBER) are required to encourage EU Member States to subsidise environmentally sound projects more selectively, urges the European Environmental Bureau in response to a public consultation on the review of the Regulation [1].

Through the GBER, the European Commission can declare specific categories of state aid to be exempt from Member States requiring prior notification and approval from the institution.

The European Environmental Bureau (EEB) acknowledged in its response published today [2] that the Regulation is key in this critical time to ensure that EU’s climate neutrality and zero-pollution targets are met and to prevent Member States subsidising harmful projects with public money.

Providing amendments and comments on the proposals of the Commission, the EEB demands greater clarity on definitions in order to prevent greenwashing claims, as well as to increase legal certainty, greater consideration of key environmental principles at the basis of EU Treaties, and to firmly shut the door on funding unsustainable projects. The EEB also called for the exclusion from the Regulation of fossil gas, the reliance on carbon capture and storage/utilisation and storage, low carbon hydrogen and tax reductions favouring energy intensive industries that would be in blatant disregard to the ‘polluter pays’ principle.

Furthermore, the sustainability of projects concerning renewable hydrogen and biomass should be strengthened by better defining ‘sustainable biomass’, and limiting the use of renewable hydrogen to hard-to-abate sectors, such as steel making. Regarding environmental taxes that price negative externalities, the GBER should respect the principles of ‘polluter pays’ and ‘prevention at source’, and keep big polluters accountable with no exemption. The introduction of further criteria and decision-making steps in the section on environmental protection of aid granted by the GBER is also key to improve policy coherence and integration.

These amendments would better align with the EU’s decarbonisation efforts and prevent the perpetuation of fossil gas infrastructures, taking into account the climate-neutrality objectives of the Paris Agreement, the Green Deal and the European Climate Law, as well as the Zero Pollution Ambition to ensure a toxic-free environment.

Riccardo Nigro, EEB Campaign Coordinator on Coal Combustion and Mines, said:

“The Commission must ensure that EU environmental policies are consistent across legislation, and compatible with the Paris Agreement and the European Green Deal. Unfortunately, the GBER proposed by the Commission (as well as the leaked text of the Guidelines for Climate, Environment and Energy) make us fear that it won’t be the case for EU’s competition policy.”

“This is the time to make a decisive step to make public spending boost the uptake of renewable energy and increase energy efficiency, not for wasting precious public resources into false solutions as fossil gas, carbon sequestration or for benefitting the greatest polluters with tax exemptions“, Nigro said.

ENDS

Notes to the editor:
[1] Targeted review of the General Block Exemption Regulation (State aid): revised rules for State aid promoting the green and digital transition

[2] EEB’s comments and amendments to the General Block Exemption Regulation(GBER) consultation