State aid: Commission approves €120 million Spanish scheme under Recovery and Resilience Facility to support sustainable rail freight transport

State aid: Commission approves €120 million Spanish scheme under Recovery and Resilience Facility to support sustainable rail freight transport

The European Commission has approved, under EU State aid rules, a €120 million Spanish scheme made available through the Recovery and Resilience Facility (‘RRF’) to encourage freight traffic to shift from road to sustainable rail transport. The measure will also contribute to improving the environmental performance of rail transport, in line with the objectives of the Commission’s Sustainable and Smart Mobility Strategy and the European Green Deal.

Executive Vice-President Margrethe Vestager, in charge of competition policy said: “The €120 million scheme approved today will contribute to improving the competitiveness and greening of rail freight transport in Spain. It will also support the shift from road to rail, in line with the objectives of the European Green Deal, while limiting possible distortions of competition.”

The Spanish measure

The measure notified by Spain, with an estimated budget of €120 million, will be entirely funded through the RRF following the Commission’s positive assessment of the Spanish Recovery and Resilience Plan and its adoption by the Council.

The scheme, which will run until 30 June 2026, is aimed at promoting rail as a more environmentally friendly mean of transportation, as well as at contributing to the greening of rail transport.

The support will take the form of direct grants to compensate freight companies for the cost difference between road and rail transport based on the actual volumes of freight shifted from road to rail transport. The aid amount is also calculated based on the environmental performance of the rail companies, which incentivises performance improvements. The scheme is open to all freight companies established in the European Union and possessing all the necessary licences, such as the single safety certificate. The maximum amount of aid per beneficiary depends on the modal shift achieved. To incentivise freight companies to shift to rail, the concrete aid amounts per beneficiary will depend on the rail freight traffic increase during the previous year.

The Commission’s assessment

The Commission assessed the scheme under EU State aid rules, in particular Article 93 of the Treaty on the Functioning of the European Union (‘TFEU’) on coordination of transport and the 2008 Commission Guidelines on State aid for railway undertakings (‘Railway Guidelines’).

The Commission found that:

  • The Spanish scheme is beneficial for the environment and for mobility, as it supports rail transport, which is less polluting than road transport, and, at the same time, decreases road congestion.
  • The measure is necessary to achieve the pursued objectives, namely the coordination of rail transport and the shift of freight transport from road to rail.
  • The maximum amount of aid respects the caps set out in the Railway Guidelines and, therefore, the measure is proportionate, i.e. limited to the minimum necessary.
  • The aid is limited to compensation for the cost difference between road and rail transport and, therefore, will not have undue negative effects on competition and trade in the EU.

On this basis, the Commission approved the measure under EU State aid rules.

Background

All investments and reforms entailing State aid included in the national recovery plans presented in the context of the RRF must be notified to the Commission for prior approval, unless covered by one of the State aid block-exemption 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. At the same time, the Commission makes sure in its decision that the applicable State aid rules are complied with, in order to preserve the level playing field in the single market and ensure that the RRF funds are used in a way that minimises competition distortions and do not crowd out private investment.

Source: State aid: Commission approves €120 million Spanish scheme (europa.eu)

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