The Greek government has redirected a significant portion of emissions trading revenues away from renewable energy and consumer energy subsidies to support energy-intensive industries.
According to a report at OT, a recent decision by Greece’s Ministry of Environment and Energy (YPEN) increases the share of CO₂ emissions auction revenues allocated to industries like aluminum, steel, and refineries. In accordance with the decision, energy-intensive industries will now receive 25% (up from the previously planned 17%) of the revenue from CO₂ emission allowances for 2024. The percentage for 2023 had already been raised (through a decision at the end of December) to 19.6% (from 16.01%).
Cuts to Renewable Energy and Consumer Subsidies
To accommodate this shift, funding for renewable energy and energy transition programs has been reduced:
- The Special Renewable Energy Account (ELAPE), which supports renewable energy producers, saw its share drop from 14.61% to 9.51%, losing €56 million.
- The Energy Transition Fund (TEM), which subsidizes consumer electricity bills, was cut by €44 million, dropping to 41.82% from 45.82%.
- The Green Fund, which finances environmental and climate projects, lost €52 million, with its share falling to 6.08% from 10.8%.
Economic Justification vs. Climate Concerns
The government defends these changes as a necessary measure to prevent “carbon leakage”—the relocation of industrial production to countries with weaker environmental regulations and lower energy costs, says OT.
A recent Green Tank report highlights that Greek energy-intensive industries received €681 million in ETS support from 2021-2023, compared to just €151 million in the entire 2013-2020 period. Meanwhile, the EU has set ambitious renewable energy targets, and concerns are mounting that Greece’s policy shift may delay necessary investments in clean energy infrastructure.
