Renewable energy policy database and support: single

Tax regulation mechanism (Development Law)

Updated: 17.01.2019

Author: Georgios Maroulis

The Development Law that came into force in July 2016, foresees support for biofuels production in a form of an income tax relief and a stabilisation of the income tax coefficient (art. 9 par. 8 Law No. 4399/2016). They can be substituted with other support mechanisms, i.e. subsidies, under the Development Law (s. “Subsidies”).

Eligible technologies

Production of sustainable biofuels which are not based on edible plants and are not subject to a supply obligation or blending is eligible for support (art.9 par.8 Law No.4399/2016).

Biofuels	Eligible for support are biofuels which are not based on edible plants and are not subject to a supply obligation or blending(art.9 par.8 Law No.4399/2016).

Biofuels

Eligible for support are biofuels which are not based on edible plants and are not subject to a supply obligation or blending(art.9 par.8 Law No.4399/2016).

Amount

Only the production of sustainable biofuels which are not based on edible plants and are not subject to a supply obligation or mixing is supported (art.9 par.8 Law No.4399/2016). To be eligible for support, minimum investment should amount to (art.5 par.3 Law No. 4399/2016):

Large enterprises: € 500,000
Medium enterprises: € 250,000
Small enterprises: € 150,000
Very small enterprises: € 100,000
Social cooperatives/ cooperatives: € 50,000

The following types of support are alternatively offered by the Development law (art. 10 Law No. 4399/2016): 1. Income tax relief and 2. Stabilisation of income tax coefficient RES are supported in the following investment categories:

General entrepreneurship (art.38 Law No.4399/2016). Only income tax relief is eligible
New independent SMEs (art.43 Law No.4399/2016). Only income tax relief is eligible
Supporting innovation for SMEs (art.48 Law No.4399/2016). Only income tax relief is eligible
Major investment plans (art.66 Law No.4399/2016). Tax relief can be provided for 12 years and stabilisation of income tax coefficient is provided for 10% of the total investment cost, up to a maximum amount of € 5 million.

RES are eligible for support, subject to the following limitations (art. 11 par.3 subpar.2h and 2z Law No. 4399/2016): For biofuels (art. 11 par.3 subpar. 2h Law No. 4399/2016) there are two options: Option 1 If extra investment costs necessary to promote the production of energy from renewable sources are eligible costs under art. 41 par. 6 cases a and b of the EU Regulation 651/2014:

45% of the eligible expenditure for large enterprises
55% of the eligible expenditure for medium enterprises
65% of the eligible expenditure for small enterprises.

Option 2 If extra investment costs necessary to promote the production of energy from renewable sources are eligible costs under art. 41 par. 6 case c of the EU Regulation 651/2014:

30% of the eligible expenditure for large enterprises
40% of the eligible expenditure for medium enterprises
50% of the eligible expenditure for small enterprises.

Further support between 5%-15% is foreseen, if the investment takes place in certain regions specified stipulated in the Regional Support Map (C (2014) 2642/7.5.2014), which is approved by the European Commission and is available at: http://ec.europa.eu/competition/state_aid/cases/252063/252063_1547272_57_2.pdf

Addressees

Procedure

Process flow	Proposal Submission: Interested parties submit their proposals to the Ministry of Economy, Development and Tourism or to the respective Administrative Region Authorities once a related call is issued. Interested parties are also obliged to pay a deposit fee that varies between € 300 - € 5,000 and should not exceed € 50,000 for major investment plans (art.13 Law No.4399/2016). Primary Assessment: All investment plans are assessed according to predefined criteria (art. 14A Law No. 4399/2016). Second Assessment: The second stage of the assessment takes specific economic criteria into consideration. . There are two kinds of Assessment: Comparative and Direct. In relation to the Comparative Assessment, Aa ranking is made and those investment plans that have received the highest scores receive the subsidy. In relation to Direct Assessment, the proposal is examined on a “case-to case” basis according to specific criteria. The process is completed within thirty fifty (530) days. Further inquiries for any of the proposals should be submitted within ten (10) days (art.14B law No.4399/2016). Investment Plan control: Competent authorities will control the realisation process of the investment plan. This control will be carried out once 50% of the investment plan (in economic or physical terms) is completed (art. 16 Law No. 4399/2016). Support approval: The plant operator receives the support as a lump sum or in instalments, depending on the support category (art.20 Law No.4399/2016). More specifically, the tax relief is validated after 50% of the investment plan is completed. The tax relief is offered for a period of fifteen (15) years. For major investment plans tax relief can be provided for 12 years and stabilisation of income tax coefficient is provided for 10% of the total investment cost, up to a maximum amount of € 5 million (art.66 Law No.4399/2016).
Competent authority	The authority in charge is the Ministry of Economy, Development and Tourism. In addition, the Ministry of Interior and the Administrative Regional Authorities are in cases in charge (art.14 par.7 Law No. 4399/2016).

Process flow

Proposal Submission: Interested parties submit their proposals to the Ministry of Economy, Development and Tourism or to the respective Administrative Region Authorities once a related call is issued. Interested parties are also obliged to pay a deposit fee that varies between € 300 - € 5,000 and should not exceed € 50,000 for major investment plans (art.13 Law No.4399/2016).
Primary Assessment: All investment plans are assessed according to predefined criteria (art. 14A Law No. 4399/2016).
Second Assessment: The second stage of the assessment takes specific economic criteria into consideration. . There are two kinds of Assessment: Comparative and Direct. In relation to the Comparative Assessment, Aa ranking is made and those investment plans that have received the highest scores receive the subsidy. In relation to Direct Assessment, the proposal is examined on a “case-to case” basis according to specific criteria. The process is completed within thirty fifty (530) days. Further inquiries for any of the proposals should be submitted within ten (10) days (art.14B law No.4399/2016).
Investment Plan control: Competent authorities will control the realisation process of the investment plan. This control will be carried out once 50% of the investment plan (in economic or physical terms) is completed (art. 16 Law No. 4399/2016).
Support approval: The plant operator receives the support as a lump sum or in instalments, depending on the support category (art.20 Law No.4399/2016). More specifically, the tax relief is validated after 50% of the investment plan is completed. The tax relief is offered for a period of fifteen (15) years. For major investment plans tax relief can be provided for 12 years and stabilisation of income tax coefficient is provided for 10% of the total investment cost, up to a maximum amount of € 5 million (art.66 Law No.4399/2016).

Competent authority

The authority in charge is the Ministry of Economy, Development and Tourism. In addition, the Ministry of Interior and the Administrative Regional Authorities are in cases in charge (art.14 par.7 Law No. 4399/2016).

Distribution of costs

Plant operator	The own contribution amounts to 25% of total investment cost (art.5 par.1 Law No.4399/2016)
State	The support is offered by the state and more specifically Ministry of Economy, Development and Tourism (art.14 par.3 Law No. 4399/2016). The budget varies at each call of an investment category.

Plant operator

The own contribution amounts to 25% of total investment cost (art.5 par.1 Law No.4399/2016)

State

The support is offered by the state and more specifically Ministry of Economy, Development and Tourism (art.14 par.3 Law No. 4399/2016). The budget varies at each call of an investment category.

Renewable energy policy database and support

Legal sources on renewable energy