The European Commission has approved a €200 million budget increase in state aid to further support Irish companies in the context of Russia’s war against Ukraine.
The amendments to an existing Irish scheme are in line with the state aid Temporary Crisis Framework adopted by the commission in March 2022.
Ireland’s original scheme was approved in August this year, under which limited amounts of aid address the current liquidity shortage, and the additional costs due to severe price increases for natural gas and electricity.
Modifications to the existing scheme also include an extension of the period during which aid may be granted until December 31, 2023, and an increase of the maximum aid ceilings.
Ceilings were set at aid up to €250,000 and €300,000 for companies in the agriculture, and fisheries and aquaculture sectors respectively, and up to €2 million for companies in all other sectors.
For companies receiving larger aid amounts, the framework foresees commitments to set a path towards reducing the carbon footprint of energy consumption, and implementing energy efficiency measures.
The modified scheme remains necessary, appropriate and proportionate to remedy a serious disturbance in the Irish economy, and the commission will assess at a later stage the need for a further extension of the Temporary Crisis Framework.
Under the framework, the commission recently signed off on a €1.2 billion support scheme in the form of guarantees on loans and will be available to primary producers across all sectors.
Executive vice-president in charge of competition policy, Margrethe Vestager said:
“This €1.2 billion guarantee scheme will enable Ireland to mitigate the impact of the current crisis on smaller companies and on primary producers, allowing them to continue their activities.”
Under the Temporary Crisis Framework Ireland can benefit from the following types of support:
- Limited amounts of aid, in any form, for companies affected by the current crisis;
- Liquidity support in form of state guarantees and subsidised loans;
- Aid to compensate for high energy prices;
- Measures accelerating the rollout of renewable energy;
- Measures facilitating the decarbonisation of industrial processes;
- Measures aimed at supporting electricity demand reduction.