EU Approves €275 Million Aid for Portuguese Electro-Intensive Industries Amid Rising Electricity Costs

EU Greenlights Increased Support for Portuguese Industries

The European Commission has given its approval for Portugal to allocate up to 275 million euros to its electro-intensive industries. This significant financial support is intended to partially reimburse these companies for the increased electricity costs they have faced, primarily due to carbon costs within the European Union's Emissions Trading Scheme (ETS). The approval, announced on Tuesday, September 23, 2025, represents a 100 million euro budget increase to a scheme originally approved in November 2022.

Addressing Carbon Costs and Preventing Relocation

The aid package is designed to mitigate the impact of higher electricity prices on energy-intensive businesses, which are crucial to the Portuguese economy. The compensation is granted through partial refunds of indirect emission costs incurred between 2021 and 2030. A primary objective of this measure is to prevent these companies from relocating their operations to countries outside the EU that may have less stringent climate policies, thereby safeguarding jobs and industrial activity within the Union.

Environment and Energy Minister Maria da Graça Carvalho emphasized the strategic importance of this support, stating, 'We are protecting national industries that are committed to the energy transition.'

Beneficiaries and Conditions

The scheme targets industries in 'strategic sectors' of the economy that are particularly exposed to electricity price fluctuations. These include, but are not limited to, sectors such as

• metallurgy
• chemicals
• paper

The compensation is granted for indirect emission costs incurred in the previous year. Should the compensation requests exceed the available budget, the amount will be proportionally reduced for each beneficiary.

Broader Context of EU State Aid

This approval falls under the EU's state aid rules, which allow Member States to support specific economic activities under certain conditions. The Commission concluded that the amended scheme remains necessary and appropriate to help energy-intensive companies cope with elevated electricity prices and to avoid their relocation, which could lead to increased global greenhouse gas emissions. The aid is deemed limited to the minimum necessary and is not expected to have undue negative effects on competition and trade within the EU.