New Regulation of the Incentive Scheme “Industry Decarbonization”

Decree no. 325-A/2021, dated 29 December

1.    What is this about?

On December 29, 2021, Ministerial Order no. 325-A/2021, of December 29, was published, approving the Regulation of the Incentive Scheme "Decarbonization of Industry" ("Regulation").

The Regulation creates the Incentive Scheme "Decarbonization of Industry" and proposes to promote and support projects aimed at low carbon processes and technologies in industry, energy efficiency measures in industry, incorporation of energy from renewable sources and storage, and development of roadmaps for industry decarbonization.

This Incentive System is financed by the Recovery and Resilience Program ("PRR") and applies to the entire national territory. The Incentive Scheme "Decarbonization of Industry" is applicable to the economic activities of the industry sector, extractive industries and manufacturing industries.

2.    Eligibility

The following project typologies are eligible:

a)       Low carbon processes and technologies in industry;

b)      Adoption of energy efficiency measures in industry; and

c)       Incorporation of energy from renewable sources and energy storage.

Companies of any size or legal form in the industry sector can benefit from the Incentive Scheme, as well as managing entities of industrial zones whose investments may impact the reduction of greenhouse gas emissions in the industries installed in the areas under their management, as long as they meet the eligibility criteria established in the Regulation.

Only projects that:

a)       Fall within the objectives and priorities defined in the calls for proposals;

b)       Start after the aid application date;

c)       Include all the information required within the scope of the application process;

d)      Have a favorable final evaluation of the selection criteria;

e)      Are in conformity with the applicable national and European laws and regulations,

are eligible.

It is also important to mention that not all expenses are eligible, not being covered by the Regulation those resulting from:

a)       Normal operating costs of the beneficiary, not foreseen in the contracted investment, as well as maintenance and replacement costs, and costs related to periodic or continuous type activities;

b)      Cash payments, except in situations where this proves to be the most frequent means of payment, according to the nature of the expenses, and provided that the unit amount is less than 250 euros;

c)       Expenses paid within the scope of contracts made through intermediaries or consultants, where the amount to be paid is expressed as a percentage of the amount financed by PRR or of the eligible expenses of the operation;

d)      Purchase of used goods;

e)      VAT;

f)        Acquisition of motor vehicles, aircraft and other transport equipment (except those foreseen in the Investments approved in PRR);

g)       Interest and financial charges;

h)      Working capital;

i)        General publicity;

j)        Investments related to the production of renewable gases;

k)       Investments related to the acquisition and installation of fossil fuel consuming equipment;

l)        Costs with the maintenance and operation of the operations to be implemented within the scope of the Regulation;

m)    Travel and shipping costs;

n)      Costs with capacitor batteries or any system aimed solely at mitigating reactive energy;

o)      Costs with portable energy consumption measuring equipment or combustion control equipment;

p)      Expenses associated with registrations, authorizations, licenses and fees;

q)      Purchase of real estate;

r)       Lease and rights of use of real estate.

The support is given in the form of a non-refundable incentive.

The applications are presented within the scope of the tender opening notices and are submitted via an electronic form available at the IAPMEI site.

3.    Entry into force

Ministerial Order 325-A/2021 came into effect on December 30th, 2021.

To access the full version of the decree (link)

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