Information communicated by Member States regarding State aid granted under Commission Regulation (EC) No 70/2001 of 12 January 2001 on the application of Articles 87 and 88 of the EC Treaty to State aid to small and medium-sized enterprises

(2002/C 42/02)

(Text with EEA relevance)

Aid No: XS/41/2001

Member State: United Kingdom

Region: Scotland

Title of aid scheme or name of the company receiving an individual aid: Scottish energy demonstration scheme

Legal basis: Section 5(1) of the Science and Technology Act 1965

Annual expenditure planned under the scheme or overall amount of individual aid granted to the company: Maximum annual budget during the period 2001-2006 should not exceed GBP 1 million

Maximum aid intensity: Aid levels would be offered to beneficiaries in gross terms. They would be calculated individually in terms of the circumstances of the development, and recalculated in net grant equivalent (nge) terms as appropriate in order to check that they do not exceed the following maximum nge or nge and gross level combinations. Proposed aid levels would then be corrected if necessary to conform with the maximum aid levels defined below (definitions as in Regulation (EC) No 70/2001):

Table 1

Investment aid intensity limits

>TABLE>

Notes:

1. These are maximum levels equal to maximum nge and SME supplements as per the AA map approved in July 2000 for the UK. Actual levels of aid offered are set at the minimum level necessary to enable the project to proceed with a viable three-year business plan

2. Nge would be calculated for control purposes by computer on each project using the procedures in the Annex to the guidelines on national regional aid (OJ C 74, 10.3.1998)

3. These ceilings will be replaced by the specific limits for certain sectors when special EU rules are in force. At the commencement of this scheme, these sectors were: shipbuilding, coal, steel, synthetic fibres, motor vehicles and transport

A condition of aid under this scheme is that it will be maintained in the recipient region of Scotland for at least five years

The ceilings in Table 1 apply to intensity of the aid calculated either as a percentage of the investment's eligible costs or as a percentage of the wage costs of employment created by the carrying out of an investment, or a combination thereof, provided that the aid does not exceed the most favourable amount resulting from the application of either calculation

AID FOR CONSULTANCY SERVICES

Maximum aid intensity is 50 % gross towards eligible costs

Eligible costs are:

- outside consultants. The activities on which the consultants shall be employed will be towards specific business development objectives and not of a continuous or ongoing nature. They will not provide services in connection with the normal operating expenditure such as management supervision, tax or financial processing, legal services and advertising

- participation for the first time at a particular trade fair or exhibition. Eligible costs are those additional to normal business operations, and specifically costs incurred in renting a stand or space, setting up, and running the presence at the event

MAXIMUM SCALE OF PROJECT AND AID

Individual awards under this scheme will become ineligible for aid if either of the following limits applies to the project proposal:

1. the total eligible cost of the project is at least EUR 25 million and:

- in areas which do not qualify for regional aid under the current UK national assisted area map, the gross aid intensity is at least 50 % of the ceilings laid down in Article 4(2) of Regulation (EC) No 70/2001, Annex 1,

- in areas which qualify for regional aid, the net aid intensity is at least 50 % of the net aid ceiling as determined in the UK national assisted areas map; or

2. the gross aid amount is at least EUR 15 million

Date of implementation: 31 May 2001

Duration of scheme or individual aid award: Scheme ends 31 May 2006

Objective of aid: The Scottish Executive is committed to working together with the people of Scotland to build a sustainable country. To that end Scottish Executive Ministers want to encourage the take-up of energy efficiency measures and clean energy sources in Scotland

The purpose of the scheme is to provide grant aid to encourage the development, demonstration, application and replication of energy efficiency measures and renewable energy technologies within Scotland. In the case of SMEs the funds will be utilised to assist them invest in the creation of a new establishment, the extension of existing premises or making fundamental change in the production process of an existing establishment through rationalisation, diversification or modernisation. We are especially keen to support projects in the SME sector, as often these companies do not have ready access to funds to develop innovative energy practices. An essential element to the scheme is its emphasis on promoting projects that have a demonstration value. Consequently, all recipients of grant assistance under the scheme must be prepared to afford reasonable access to their projects for a three-year period

The aim of this initiative is to facilitate access to the provision of cleaner, more efficient and sustainable energy. It provides an opportunity for SMEs, the public and voluntary sectors to pursue best practice in energy efficiency thereby reducing their environmental impact, contributing to the improvement of the global environment and mitigating the impact of climate change. The introduction of such a scheme will encourage and assist SMEs and others to adopt a more sustainable approach to their activities. The scheme will stimulate activity within the SME, local authorities and the voluntary sectors, which could lead potentially to the development of new markets in low carbon technologies. It will encourage resource efficiency across all these sectors. Bids in which private industrial and commercial organisations collaborate as part of consortium bids will be strongly encouraged

Economic sector(s) concerned: All sectors may be assisted, but with the specific exceptions of the activities as in Article 1 of Commission Regulation (EC) No 70/2001 concerning Treaty Annex I goods, export-related aid and aid contingent upon the use of domestic goods. In addition, any special restrictions contained within specific sectoral rules via Community Directives or Regulations will apply when these sectors are assisted under this scheme

This scheme does not apply to:

1. activities linked to the production, processing or marketing of products listed in Annex 1 to the Treaty

2. aid to export-related activities, namely aid directly linked to the quantities exported, to the establishment and operation of a distribution networkor to other current expenditure linked to the export activity

3. aid contingent upon the use of domestic goods rather than imported goods

Name and address of the granting authority: Scottish Executive ( Scottish Energy Efficiency Office ) 2nd floor

Meridian Court

5 Cadogan Street

Glasgow G2 6AT United Kingdom

Other information: This scheme will be applied in accordance with Regulation (EC) No 70/2001 of 12 January 2001

Contact: Allan Mackie Scottish Energy Efficiency Office 2nd floor

Meridian Court

5 Cadogan Street

Glasgow G2 6AT United Kingdom Tel. (44-141) 242 58 14 Fax (44-141) 242 58 08 E-Mail: allan.mackie@scotland.gsi.gov.uk