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The European Commission has sent on 11 July to Member States for consultation a draft proposal to adjust the State aid Temporary Crisis Framework, to support the economy in the context of Russia's invasion of Ukraine.

For reference, the State aid Temporary Crisis Framework, initially adopted on 23 March enables Member States to use the flexibility foreseen under State aid rules to support the economy in the context of Russia's invasion of Ukraine, via limited amounts of aid, liquidity support or financial compensation to alleviate high energy prices. In view of the prolonged war in Ukraine, which has further direct and indirect effects on the economy and on the energy situation, the Commission is assessing the need to adjust the Temporary Crisis Framework. The proposal sent to Member States also takes into consideration the EU objective of becoming independent from fossil fuels. Among others, the Commission considers possible amendments relating to:

• The adjustment of maximum aid ceilings foreseen in the provisions on limited amounts of aid, which allow Member States to provide direct grants or other forms of aid to companies in any sector affected by the crisis;
• The need for additional measures, facilitating the investments in renewable energy, including renewable hydrogen, biogas and biomethane, storage and renewable heat, in line with the REPowerEU Plan.
• The need for additional measures to further accelerate the diversification of energy supplies, reducing the dependency on imported fossil fuels by supporting energy efficiency measures This amendment would enable Member States to either (i) set up new tender-based schemes, or (ii) directly support projects, without tenders, with certain limits on the share of public support per investment.

Member States now have the possibility to comment on the Commission's draft proposal, with an expected adoption by the Commission in the next weeks.

Source: European Commission