July 31, 2018

EC approves €500m German energy-efficiency scheme

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The scheme will provide public support for investment in technologies to make rail transport more cost and energy efficient. The scheme will provide public support for investment in technologies to make rail transport more cost and energy efficient.

THE European Commission (EC) approved on July 27 a German scheme to support rail companies that invest in energy efficiency technologies which it says will promote the shift of freight traffic from road to rail and contribute to a reduction of CO2 emissions.


In January 2018, Germany notified the Commission of a scheme to provide public support for investment in technologies to make rail transport more cost and energy efficient. The scheme has an overall budget of €500m and will run from 2018 to 2022.

 

Through the scheme, approved under European Union (EU) state aid rules, companies providing electrically-powered rail transport services may be compensated for up to 50% of expenses incurred from energy-efficiency measures, such as the purchase of modern energy-saving rolling stock including hybrid locomotives or automated solutions that allow rail transport companies to increase their energy efficiency.

To benefit from this public support, rail transport companies must demonstrate a year-on-year improvement of 1.75% in their energy efficiency. From 2020, this energy efficiency must increase by at least 2% year-on-year for companies to be eligible for support.

“Electrically-powered rail transport is one of the most environmentally-friendly transport options,” says Ms Margrethe Vestager, competition policy commissioner. “By promoting a shift from road to rail, the German scheme will contribute to meeting the EU's environmental and transport objectives, without distorting competition.”

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