Documents seen by POLITICO show that EU competition chief Margrethe Vestager has proposed a new state aid framework that would help counter the “immediate” challenges brought on by the United States’ green-subsidy splash.
In a letter sent to EU finance ministers on January 13, Vestager has targeted the US anti-inflation lawA $369 billion climate-friendly subsidy package. Brussels sees the program as a protectionist move that could potentially violate international trade rules.
The US bill “entices some of our EU businesses to invest in the US,” writes Vestager.
In response, she suggests a new “temporary crisis and transition framework”, which would simplify state aid rules for green projects, and in particular “all renewable energy technologies”.
The hydrogen and electric-vehicle sectors may also be exempt from state aid notification requirements under the block’s general block exemption regulation.
Vestager said the new framework would also offer “anti-relocation investment support” to prevent firms from leaving the bloc to seek more favorable conditions abroad.
“I envisage dedicated provisions to support new investment in production facilities, including tax breaks,” writes Vestager.
Vestager is seeking feedback from member states on its changes, with a deadline of January 25 to respond. EU finance ministers will To meet in Brussels on Tuesday.