The Concept of State Aid and Its Application Criteria

When aiming to achieve market liberalisation objectives, it is essential to find a harmonious equilibrium between the interests of enterprises and consumers. This necessitates considering operators’ investments in infrastructure development and improvement, as well as the execution of new projects. In the energy sector, enterprises frequently can receive subsidies, assistance from public resources, or specific tax provisions for their activities. Furthermore, corporations can take advantage of temporary tax advantages while building a project until they have recovered their investment. Countries adopt several techniques to promote the development of renewable energy sources, often including set rates and a variety of incentives. The main goal of the state assistance control system is to ensure the overall integrity of competition, rather than show preference for certain economic entities. Strong competition is critical to ensuring the supply of goods and services at the most reasonable price. State assistance to inefficient enterprises enables their continued existence in the market by displacing non-subsidised entities. The problem occurs when some actions create distortions in market competition by granting certain benefits to corporations that they would not have acquired under normal market conditions.