European Commission approves €180m Czech scheme to support rail operators using electric traction

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The European Commission has approved, under EU State aid rules, a €180m Czech scheme to better support rail and urban public transport operators using electric traction.

The measure will contribute to improving the environmental performance of rail and urban transport, in line with the objectives of the Commission’s Sustainable and Smart Mobility Strategy and the European Green Deal.

Czechia notified the Commission of its plans to support operators of rail passenger and freight transport and urban public transport, which run their vehicles on electric traction. The scheme will run until the end of 2026.

The aim of the measure is to promote transport by electric traction as a greener mode of transport as opposed to diesel-powered vehicles, and the shift of freight and passenger transport from road to rail and urban transport.

Under the scheme, the aid will take the form of an exemption for transport operators from the renewable energy sources fee (RES fee), which is included in the electricity bills of electricity consumers and finances renewables energy generation in Czechia.

The Commission assessed the measure under EU State aid rules and found that the scheme is beneficial for the environment and mobility, as it supports rail and urban transport using electric traction, which is less polluting than road transport and diesel traction and decreases road congestion.

The EC also found that the measure will support the modal shift from road to rail and urban transport using electric traction.

Today's decision follows the Commission's approval, on July 16, 2021, of a further €45m Czech scheme which provides additional support in the form of direct grants to rail freight operators using electric traction.

“This €180m scheme will allow Czechia to support electric traction, which is a more environmental-friendly mode of rail and urban transport compared to diesel-fueled vehicles. It will help Czechia meet the European Green Deal objectives, while reducing the burden of rising electricity costs for transport operators, passengers, and freight customers,” explained Margrethe Vestager, executive vice-president in charge of competition policy at the EC.