A State Aid Framework for a Green Recovery

The report argues that the EU Commission should integrate climate and environmental protection objectives into its State aid decision-making process to ensure that national economic recovery programmes are consistent with the European Green Deal and the goal of climate neutrality by 2050.

• The EU Commission has historically focused State aid oversight on limiting market distortions and has been reluctant to align national aid measures with European climate and energy objectives when the aid is intended for non-environmental purposes.
• Legal analysis indicates that the EU Commission is both authorised and required under the EU Treaties to apply environmental considerations even when assessing non-environmental aid, specifically citing Article 11 TFEU.
• There is a risk that COVID-19 economic recovery funds may lead to a 'lock-in' of obsolete and polluting technologies if they are not tied to green conditions, potentially cancelling the roadmap of the European Green Deal.
• The report proposes a new compatibility assessment criterion for State aid that evaluates the impact of the supported project or activity on Green Deal objectives, consisting of two primary rules: compliance with EU environmental laws and a climate and environment compatibility assessment.
• Under the proposed 'Rule 1', any State aid that contravenes EU environmental law should be declared incompatible with the internal market, and recovery of the aid should be triggered in cases of non-compliance.
• The proposed 'Rule 2' suggests that aid should be more restrictive if it increases negative environmental effects, has long-term negative impacts, lacks less-harmful alternatives, or lacks mitigation safeguards.
• The report argues for the immediate and definite phasing out of all public subsidies for fossil fuel projects, noting that such an objective has existed in State aid rules for a decade without concrete implementation.
• Member States have an indirect obligation under Article 4(3) TFEU (the 'duty of cooperation') to refrain from granting aid that jeopardises the attainment of the Union's environmental objectives.
• The report identifies specific examples of green recovery measures, such as Germany's EUR 40 billion for climate-centred policies, France and Austria's green conditions for airline bailouts, and Italy's 110% tax rebate for energy-efficient building renovations.

APA

ClientEarth (2020). A State Aid Framework for a Green Recovery. https://www.clientearth.org/media/c45naoms/2020-09-30-a-state-aid-framework-for-a-green-recovery-coll-en.pdf

Chicago

ClientEarth. A State Aid Framework for a Green Recovery. 2020. https://www.clientearth.org/media/c45naoms/2020-09-30-a-state-aid-framework-for-a-green-recovery-coll-en.pdf.

Wikipedia

{{cite report |author=ClientEarth |title=A State Aid Framework for a Green Recovery |date=September 2020 |url=https://www.clientearth.org/media/c45naoms/2020-09-30-a-state-aid-framework-for-a-green-recovery-coll-en.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{clientearth2020state, author = {{ClientEarth}}, title = {{A State Aid Framework for a Green Recovery}}, institution = {ClientEarth}, year = {2020}, month = sep, url = {https://www.clientearth.org/media/c45naoms/2020-09-30-a-state-aid-framework-for-a-green-recovery-coll-en.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }