The EU Commission finds that a German noise reduction measure is compatible with the internal market under Article 93 TFEU (German Freight Wagons)
* Article published on StateAidHub: http://stateaidhub.eu, republished in e-Competitions with the courtesy of the author. The original title of this article appears below the e-Competitions title. Authors are welcome to write an alternative article on this case/text, provided they have no relationships with a party or related third party. Article will need e-Competitions Board approval before publication.
The Puzzle of Environmental Aid: Why Do Firms Make Environmental Investments?*
Introduction
Environmental aid is the second largest horizontal category of State aid, after regional aid. It accounts for about 24% of all aid to industry and services. Yet, one often hears from public officials that the current Environmental Aid Guidelines (EAG) do not provide sufficient incentives for environmental protection. The problem is that aid is calculated as a percentage not of the whole investment costs but only of the extra costs. These extra costs are the difference between the cost of conventional technology and the higher cost of more environmentally friendly technology. Therefore, permissible aid is only a fraction of the additional costs.
For normal investments, say investment in a
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