In a landmark departure from long-standing EU policy, Brussels will now allow member states to subsidize the operating costs of energy-intensive industries in an effort to prevent the exodus of key sectors to countries with cheaper power.
The newly approved measure permits governments to offer discounts of up to 50% on half of a company’s electricity usage, effectively covering up to 25% of their total power bills, as long as costs don’t fall below €50 per megawatt-hour. The policy, which breaks from traditional EU restrictions on state aid, will remain in effect until 2030.
“If Europe wants to lead in clean tech, we must act with courage and clarity,” said EU competition chief Teresa Ribera. She called the move essential to keeping European energy systems “stable, affordable, and fair” without distorting the bloc’s single market.
Historically, the EU treaties prohibited state aid to avoid giving domestic firms unfair advantages. While capital investments were occasionally supported, operational subsidies were typically off-limits—until now.
Joachim Schmitz-Brieber of think tank EPICO noted the scale of the change: “This was only conceivable in absolutely exceptional cases. Now it’s policy.” The shift reflects serious concerns about industrial relocation, particularly as European firms struggle to compete with Chinese and U.S. companies enjoying lower energy costs.
Industries eligible for the subsidies include steel, aluminum, and coal operations, which face mounting pressure from foreign competitors. The measure is expected to be most welcomed by Germany and France, which have long lobbied for relaxed state aid rules to help struggling industries.
However, smaller EU countries have voiced concern that such subsidies could create market imbalances by favoring richer member states with deeper pockets.
