The European Commission has approved, under EU State aid rules, a Greek measure to support the construction and operation of a pumped hydroelectricity storage facility in Amfilochia, Greece. The measure will be partly funded by the Recovery and Resilience Facility (‘RRF'), following the Commission's positive assessment of the Greek Recovery and Resilience Plan and its adoption by Council.
The aid will take the form of a €250 million investment grant and of an annual support – financed from a levy on electricity suppliers – to complement market revenues, in order to reach an acceptable rate of return on the investment. The supported storage facility will have a capacity of 680 Megawatts (MW) and will be directly connected to high-voltage transmission lines. By supporting the operation of existing renewable energy units as well as by enabling the introduction of new ones, the project will contribute to a smooth and effective transition to clean renewable energy of the Greek power system, in line with the decarbonisation target of the European Green Deal.
The Commission assessed the measure under EU State aid rules, in particular Article 107(3)(c) of the Treaty on the Functioning of the European Union, which enables EU countries to support the development of certain economic activities subject to certain conditions, and the Guidelines on State aid for environmental protection and energy. The Commission found that the aid is necessary and has an incentive effect, as the project would not be carried out without the public support. Furthermore, the measure is proportionate, as the level of the aid corresponds to the effective financing needs and necessary safeguards limiting the aid to the minimum will be in place (e.g., adjustment of the annual support and of the target internal rate of return, in case of an increase in construction costs). The Commission also took into account the inclusion of the project in the list of European Projects of Common Interest in the energy sector. The Commission therefore concluded that the positive effects of the measure outweigh any potential distortion of competition and trade brought about by the support. On this basis, the Commission approved the measure under EU State aid rules.
The Commission assesses measures entailing State aid contained in the national recovery plans presented in the context of the RRF as a matter of priority and has provided guidance and support to Member States in the preparatory phases of the national plans, to facilitate the rapid deployment of the RRF. The non-confidential version of the decision will be made available under the case number SA.57473 in the State aid register on the Commission's competition website once any confidentiality issues have been resolved.
20 December 2021