Banco Sabadell: According to press reports, the EU plans to respond to the US $369 billion (€340 billion) Inflation Reduction Act (IRA) by relaxing state aid rules on tax credits for green investments. A portion of the €800 billion NGEU fund could also be directed towards tax credits. By relaxing restrictions on tax credits, the EC seeks to emulate one of the advantages of the IRA, simplicity of access. The proposal was published this week after discussion in the Commission.
Assessment: This is positive news (pending further details) as it demonstrates the strong commitment of the authorities to encouraging renewable investment in the region. However, this could be a controversial issue in the EU given the disparity of fiscal and administrative situations between the different countries in the region, in light of what has been seen up to December with the speeding up of access permits in some countries, such as Spain. In this regard, we recall that at the end of 2022, up to ~80,000 MW remained stuck in our country pending resolution of their environmental impact statement (EIS) – which would have already begun to be processed.