​The Ministry of Energy has prepared a project on the application of a state aid scheme for large energy-consuming companies, exempting them from paying certificates. The institution responded to HotNews.ro’s request that preliminary documentation on the state aid scheme was sent in November 2023 to the Directorate General for Competition through the Competition Council. Companies will receive aid from 1 January 2024 through a transitional provision based on the old legislation.

The scheme has been discussed with steel producers

Similar public assistance has been available since 2014 under HG 495/2014, a scheme which is nearing completion. The main beneficiaries were Alro, an aluminum producer, and Liberty Galati, a steel producer. In fact, this is state aid, which appeared as a result of strong lobbying by these companies, and the new project was developed in the conditions in which the old scheme expires this year.

In addition, on November 16, 2023, a meeting was held at the headquarters of the Ministry of Energy with representatives of the Union of Steel Producers of Romania (UniRomSider) “to discuss the provisions of the new state aid scheme, in the context of which the Impact of electricity and gas on end-user costs is likely to support or destabilize the industry “, the Ministry of Energy stated at the request of HotNews.ro.

The institution also reported that on December 6, “associations and employers’ organizations of renewable energy producers in Romania were invited to discuss issues related to this state aid scheme, and the conclusions of the Consumer Exemption Impact Analysis were presented.” intensity from the payment of green certificates”.

Transitional provision: assistance will be provided from January 1 under the old legislation

According to the project, the state aid scheme will be valid until December 31, 2031. The total budget of the scheme is the equivalent of 750 million euros in lei, and the aid provided will not exceed 150 million euros each year.

The approximate number of beneficiaries of state aid under this scheme is approximately 200 people.

The project also has a transitional provision that provides for:

• “In the period 01.01.2024 and until the date of completion of the analysis of the documentation submitted as a result of the approval of this state aid scheme, the beneficiaries of the exemption agreements developed on the basis of the provisions of HG 495/2014 with subsequent amendments and additions will use the exemption percentage specified in the relevant agreement on exemption (40%, 60% or 85%).
• In this sense, after 90 days from the publication of the regulatory act governing this state aid scheme (the period of evaluation of the submitted documentation), the beneficiaries of the exemption agreements developed on the basis of the provisions of HG 495/2014 as subsequently amended and supplemented will receive the exemption agreements in accordance with conditions provided for in ARTICLE 7 of this state aid scheme, and will have the obligation to notify its electricity suppliers and NARE of the new exemption agreement.

HG 495/2014 states that depending on the electricity capacity of the enterprises, the beneficiaries will pay the following percentages on the number of green certificates related to the mandatory quota:

• a) 15% in case of electrical intensity more than 20%;
• b) 40% in case of electrical intensity between 10-20%;
• c) 60% in case of electric intensity between 5-10%.

The scheme operated for 10 years.

Aid condition: Half of energy consumption must come from clean sources

The draft stipulates that in order to receive an annual exemption agreement, companies must work in risk-prone sectors and not register debts to the state.

State aid is provided on the condition that beneficiaries pay 15% or 25% of the costs associated with the obligation to purchase green certificates, depending on the energy intensity. The reductions applied shall not result in a charge below 0.5 EUR/MWh per year.

If, as a result of checks carried out during the analysis stage of the request by the Ministry of Energy, it is found that after the proposed reductions, the remaining payment is equal to or less than 0.5 EUR/MWh, the company cannot obtain permission to release.

They must also invest a significant proportion of at least 50% of the aid amount in projects that lead to a significant reduction in the installation’s greenhouse gas emissions.

Beneficiaries will cover at least 50% of their electricity consumption from carbon-free sources, of which at least 10% will be covered by a forward instrument such as a power purchase agreement, or at least 5% will be covered by on-site or near-site generation.

Assistance may be granted annually

The current draft provides that the state aid is granted annually if the beneficiary has submitted an application to the Ministry of Energy for this purpose, called an Application for an Annual Exemption Agreement.

In the first year of the state aid scheme, potential beneficiaries can apply for an Annual Partial Exemption Agreement within 30 working days from the date of publication of the state aid scheme in the Official Gazette, but not earlier than 31 May.

Starting from the second year of the state aid scheme, the application for the Annual Partial Exemption Agreement (according to the model given in Appendix 1 of this state aid scheme) together with the relevant documents must be submitted by May 31 of each year. year of the state aid scheme.

Annual release agreements can be issued during the 90 day assessment phase, with an effective date of 1 September each year, commencing in the second year of the scheme.

The annual release agreement is valid for 12 months from the date of receipt, excluding the first and last year of the scheme.

For the first year, the agreement is valid until August 31 of the following year, so starting with the second year.

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