The European Commission has approved a €2.36 billion ($2.6 billion) scheme to boost clean tech manufacturing in Hungary as per the tenets set by the Green Deal Industrial Plan.
The scheme, which was approved under the State aid Temporary Crisis and Transition Framework, seeks to accelerate investments in strategic sectors in Hungary, in line with the Green Deal Industrial Plan.
The measure will be open to companies producing relevant equipment, namely batteries, heat pumps, solar panels, wind turbines, electrolysers, equipment for carbon capture usage and storage, as well as key components designed and primarily used as direct input for the production of such equipment or related critical raw materials necessary for their production.
Under the measure, the aid will take the form of direct grants and tax advantages.
Aid under the scheme aims to incentivise the production of equipment needed for net zero and will be granted no later than 31 December 2025.
Europe’s green industry
The State aid Temporary Crisis and Transition Framework will help speed up investment and financing for clean tech production and manufacturing in the continent and will assist Member States in delivering on specific projects under National Recovery and Resilience Plans.
Under the Framework, the following types of aid will be granted by Member States:
• Liquidity support through state guarantees and subsidised loans.
• Aid to compensate for high energy prices.
• Measures accelerating the rollout of renewable energy. Member States can set up schemes for investments in all renewable energy sources, including renewable hydrogen, biogas and biomethane, storage and renewable heat, including through heat pumps, with simplified tender procedures that can be quickly implemented.
• Measures facilitating the decarbonisation of industrial processes, including investments to phase out from fossil fuels, in particular through electrification, energy efficiency and the switch to the use of renewable and electricity-based hydrogen.
• Measures aimed at supporting electricity demand reduction.
• Measures to further accelerate investments in key sectors for the transition towards a net-zero economy, enabling investment support for the manufacturing of strategic equipment, namely batteries, solar panels, wind turbines, heat-pumps, electrolysers and carbon capture usage and storage as well as for production of key components and for production and recycling of related critical raw materials.
Sanctioned Russian-controlled entities will be excluded from the scope of these measures.
Smart Energy Finances: €3bn for German low-carbon tech
The Green Deal Industrial Plan, announced earlier this year in March, is Europe’s response to increasing global competition in the energy sector and is hoped to enhance the competitiveness of Europe’s net-zero industry.
Also in March, the Commission adopted a new Temporary Crisis and Transition Framework to foster net zero support measures that are aligned with the Green Deal Industrial Plan.
A week before the announcement, a €3 billion ($3.9 billion) German scheme was announced by the Commission under the same category.