WIREDGOV

The European Commission has found Hungary's €24 million investment aid to Volta Energy Solutions for the extension of a battery copper foil plant in the Hungarian region of Közép-Dunántúl (Central Transdanubia) to be in line with EU State aid rules. The aid will contribute to the development of the region, whilst preserving competition.

The Hungarian measure

Volta Energy Solutions (previously Doosan Energy Solution) is a subsidiary of Solus Advanced Materials Co. Ltd, a large Korean company, which produces copper foil, display materials, and biomaterials.

The €24 million Hungarian investment aid will support Volta Energy Solutions' €206 million investment in the extension of its battery copper foil manufacturing plant in Környe, situated in the Hungarian region of Közép-Dunántúl (Central Transdanubia). Copper foil is generally used to manufacture batteries, and the copper foil manufactured in this plant will be specifically used for batteries for electric vehicles.

The project, which started in October 2020 and is planned to be completed in 2022, is expected to create nearly 200 direct jobs. The new unit will more than double the current production capacity of the plant.

The production plant is located in the Közép-Dunántúl (Central Transdanubia) region - an area eligible for regional aid under Art. 107(3)(a) of the Treaty on the Functioning of the European Union.

The Commission's assessment

The Commission assessed the aid measure under the applicable Guidelines on Regional State Aid for 2014-2020, which were prolonged until 31 December 2021. The rules on regional State aid enable Member States to support the economic development and employment in the EU's less developed regions and to foster regional cohesion in the Single Market.

The Commission found that:

• the investment aid will contribute to job creation as well as to the economic development and to the competitiveness of a disadvantaged region;
• in the absence of the public funding, the project would have been carried out outside the European Economic Area (EEA);
• the aid is limited to the minimum necessary to trigger the investment in Hungary, rather than outside the EEA and complies with all aid intensity requirements, also taking into account the aid which Hungary granted to the company for the same plant in 2018 under the General Block Exemption Regulation.

On this basis, the Commission concluded that the positive effects of the project on regional development clearly outweigh any distortion of competition brought about by the State aid. Therefore, it approved the measure under EU State aid rules.

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