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This is ClientEarth’s reply to the European Commission’s call for evidence and public consultation on the revised State aid General Block Exemption Regulation (GBER).
The GBER sets out the conditions under which State aid can be paid by the Member States without having to be notified for prior authorisation to the European Commission. As Member States are alone to assess whether their support to economic activities complies with the GBER, the rules therein must be clear and straightforward.
The Commissions is reviewing the GBER, in line with the EU’s Competitiveness Compass and the Clean Industrial Deal. The aim is to cut red tape and promote necessary investments, while keeping a level playing field in the Single market.
For environmental protection and energy, the rules laid down in the GBER are complementary to the State Aid Guidelines for Climate, Environment and Energy (CEEAG) and the Clean Industrial Deal State Aid Framework (CISAF): they thus need to be consistent and future-proof.
ClientEarth provided input on the call for evidence and the public consultation.
For reaching the objective of supporting the transition toward a climate neutral, clean and sustainable economy, it is key for the GBER to include aid categories for environmental protection. However, the conditions for granting aid for environment protection are sometimes inappropriate, insufficiently strict or simply too vague, to effectively contribute to its objective of environmental protection.
More generally, the GBER lacks effective environmental safeguards. Such safeguards are particularly relevant for measures that do not have environmental protection as their primary objective. In this respect, our key recommendations in our feedback are the following.
· Integrate environmental conditionalities: Compliance with EU environmental law and the Do No Significant Harm principle should be mandatory across all aid categories and should be implemented in the form of an explicit condition for eligibility. Embedding the DNSH principle by formulating concrete conditionalities in aid categories is a matter of consistency with other State aid frameworks and is necessary to comply with the environmental integration principle stemming from Article 11 TFEU.
· Prioritize energy efficiency: The Energy Efficiency First principle should be embedded in GBER design. Compliance with this principle is paramount to ensure that Member States prioritise energy efficiency considerations in the development of their environmental and energy policies.
· Remove direct and indirect support for fossil gas: we strongly oppose the possibility to support fossil gas under the GBER because it contradicts EU climate goals. Given the nature of the GBER, it is impossible to verify that Member States restrict aid for fossil gas to those last resort applications/situations where no other technology would be readily available. Aid for fossil gas should therefore be removed from the scope of the GBER and only be subject to prior notification. However, if the Commission remains supportive of aid to fossil gas in the GBER, it should be clearly constrained and subject to effective environmental conditionality.
· Restrict CCUS support: The conditions for investment aid for CCS are too loose to safeguard actual decarbonization (Art. 36). Aid for carbon capture should be limited to hard-to-abate sectors, tied to effective criteria ensuring high capture rates, and must not enable fossil fuel expansion.