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State Aid

State aid: Green light given for aid to Finnfjord AS

9.2.2011

PR(11)06

Today the Authority adopted a decision approving aid to Finnfjord AS for an energy recovery system under the Norwegian Energy Fund scheme.[1] Finnfjord will receive NOK 175 million (approx. EUR 21.3 million).

Due to the high aid amount of aid, the measure was notified to the Authority in October 2010 and has been subject to a detailed assessment under the State aid Guidelines for environmental protection.

Finnfjord is one of Europe's leading producers of ferrosilicon. Finnfjord also produces microsilica which is a by-product of the ferrosilicon production process. The production process generates a lot of heat. Currently, this heat is not used for energy production or any other useful purpose. The aid will enable Finnfjord to install an energy recovery system to generate 224 GWh of electricity and 125 GWh of steam per year. The electricity will be used in Finnfjord's production process, while the steam is to be sold.

The Authority has examined the aid measure on the basis of the Energy Fund scheme and the Guidelines. The Guidelines allow for state support to environmental objectives where, on balance, the environmental benefits of such support outweigh the potential distortions of competition. In particular, support to energy recovery may be granted to compensate for high investment costs.

The Authority has found that the positive effect of increasing energy savings outweighs the limited effect on trade and competition. The aid is proportional as it is limited to the amount necessary to trigger the investment. The aid also provides an incentive effect since the project would not be commercially viable without the aid. Finally, the structures of the ferrosilicon and microsilica markets are unlikely to be altered by the grant of aid.

For further information, please contact:

Trygve Mellvang-Berg
Press and Information Officer
Tel. (+32)(0)2 286 18 66

Christian Jordal
Temporary Officer
Competition and state aid directorate
Tel. (+32)(0)2 286 18 89



[1] Scheme approved in 2006 (Decision No 125/06/COL) and prolonged in 2010 (Decision No 486/10/COL).




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