The European Commission has approved a €612m Portuguese scheme to lower electricity levy rates for energy-intensive companies.
The scheme, running until 22 April 2035, intends to prevent companies from relocating to countries outside the EU “with less ambitious climate policies,” according to a statement.
The measure aims to support companies, such as industrial gas suppliers, that rely heavily on electricity and are particularly exposed to international trade.
Teresa Ribera, Executive Vice-President for Clean, Just and Competitive Transition, said, “The scheme maintains incentives for an effective decarbonisation of the Portuguese economy … and strengthens the competitiveness of the supported companies, in line with the [EU’s] Clean Industrial Deal objectives.”
Under the scheme, beneficiaries will have to either implement certain energy audit recommendations, cover at least 30% of electricity consumption with renewable energy sources, or invest at least 50% of the aid in projects that lead to substantial reductions of the installation’s greenhouse gas emissions.
Portugal’s natural gas supply is primarily through long-term contracts with Algeria and Nigeria, with imports also arriving via pipelines from Spain and through LNG terminals.
The latest funding follows a €1bn state aid package for Portugal last September, to foster the transition to Net Zero.
