Extension of compensatory aid for indirect CO2 emissions costs up to 2020

13 July 2017 | Markets

On Wednesday, July 12, 2017, the Royal Decree 655/2017, dated June 23, was published in the Official State Gazette (BOE), amending Royal Decree 1055/2014 of December 12, a mechanism for compensation of costs of indirect greenhouse gas emissions is created for companies in certain industrial sectors and sub-sectors which are considered to be exposed to a significant risk of "carbon leakage" and the regulatory basis for the granting of the subsidies for the 2014 and 2015 financial years, and it will be extended until December 31st of 2020.

These subsidies are designed to reduce exposure to a significant risk of 'carbon leakage' associated with the incorporation of CO2 costs into electricity prices.

In 2014 the call for these subsidies was first published, initially approved for the years 2014 and 2015, although it was foreseen the possibility of extending the period of validity of the compensation mechanism of indirect CO2 costs.

This new Royal Decree expands these aids until 2020 and substantially modifies the previous one, including changes in the percentage of the intensity of the subsidy to receive and in the form of its presentation of the request, among others.

As on previous occasions, subsidies may be requested either by companies that are included in the European Emissions Trading Scheme (EU ETS) or by those that are not, provided that they carry out activities or manufacture of any of the products listed In Annex II to the Commission Communication (2012/C 158/04). In addition, they are compatible with the reception of other subsidies aimed at offsetting the costs related to greenhouse gas emissions passed on to electricity prices.

Although this Royal Decree has been published, it will be necessary to wait for the publication of the call to be able to make the application of compensatory subsidies of costs of indirect emissions of greenhouse gases for the year 2016.

From Factor CO2 we have helped in the previous call to a large number of facilities in their request. Do not hesitate to make any kind of inquiry about it or ask us for a quote.


Iria Flavia Peñalva




Source: Factor