Commission approves €960 million Czech State aid scheme to support investments in strategic sectors

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The European Commission has approved a €960 million Czech scheme to support investments in strategic sectors to foster the transition to a net-zero economy. The scheme contributes to the achievement of the priorities of the European Commission for 2024-2029, based on the Political Guidelines, which call for investments in clean energy and technologies. The scheme also contributes to the achievement of the Clean Industrial Deal. The scheme was approved under the State aid Temporary Crisis and Transition Framework (‘TCTF’) adopted by the Commission on 9 March 2023 and amended on 20 November 2023 and on 2 May 2024.

The Czech measure

Czechia notified to the Commission, under the TCTF, a €960 million scheme to support investments in strategic sectors to foster the transition towards a net-zero economy.

The purpose of the scheme is to support investments for the production of strategic equipment (namely batteries, solar panels, wind turbines, heat-pumps, electrolysers and carbon capture usage and storage), as well as key components designed and primarily used as direct input for the production of such equipment or related critical raw materials necessary for their production.

Under the scheme, the aid will take the form of direct grants. The measure will be open to undertakings of all sizes.  

The Commission found that the Czech scheme is in line with the conditions set out in the TCTF. In particular, the aid (i) will respect the maximum aid ceilings; (ii) will incentivise the production of relevant equipment for the transition to a climate neutral economy; and (iii) will be granted no later than 31 December 2025.

The Commission concluded that the Czech scheme is necessary, appropriate and proportionate to accelerate the green transition and facilitate the development of certain economic activities, which are of importance for the implementation of the Clean Industrial Deal, in line with Article 107(3)(c) Treaty on the Functioning of the EU and the conditions set out in the TCTF.

On this basis, the Commission approved the aid measure under EU State aid rules.

Background

On 9 March 2023, the Commission adopted the TCTF to foster support measures in sectors which are key for the transition to a net-zero economy.

The TCTF provides for the following types of aid, which can be granted by Member States until 31 December 2025 in order to accelerate the green transition:

• Measures accelerating the rollout of renewable energy (section 2.5). Member States can set up schemes for investments in all renewable energy sources, with simplified tender procedures.
• Measures facilitating the decarbonisation of industrial processes (section 2.6). Member States can support investments in the decarbonisation of industrial activities with a view to reduce dependency on imported fossil fuels, in particular 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 to further accelerate investments in key sectors for the transition towards a net-zero economy (section 2.8). Member States can grant 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. Support is capped at a certain percentage of the investment costs up to specific amounts, depending on the location of the investment and the size of the beneficiary. Higher support is possible for small and medium-sized companies, as well as companies located in disadvantaged regions to ensure that cohesion objectives are duly taken into account. Furthermore, in exceptional cases, Member States may provide higher support to individual companies, where there is a real risk of investments being diverted away from Europe, subject to a number of safeguards.

More information on the TCTF can be found here.

The non-confidential version of today’s decision will be made available under the case number SA.117292 in the State aid register on the Commission’s competition website once any confidentiality issues have been resolved. New publications of State aid decisions on the internet and in the Official Journal are listed in the Competition Weekly e-News.