State aid as a tool encouraging production of energy from renewable sources

Abstract

Providing aid because of its negative impact on competition in the European market is allowed only for specific purposes that are defined in legislation. One of the areas where state aid is permissible is aid to protect the environment, and within it we can provide assistance to support the production of renewable energy sources. The rationale for the provision of such aid is the fact that the production of energy from renewable sources is more expensive than the production of energy from conventional sources. On the other hand, it is more environmentally friendly. The European Commission has decided aim before Member States of increasing the use of renewable energy sources. One of the instruments contributing to increased production of renewable energy is state aid. The article presents the justification for granting state aid in the field of renewable energy sources, indicates what are the conditions for the granting thereof. Also shown is an example of Polish aid program on support for biofuel production.