News: €8.5 million EU aid for solar wafer production in Spain

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[tweetmeme http://www.URL.com%5D Brussels, 20 July 2010. The European Commission has authorised €8.5 million of regional investment aid to the Spanish company Silicio Solar SAU for the production of solar wafers in Puertollano, Ciudad Real (Castilla-La–Mancha). The project involves investments of €219 million for the construction of a new plant next to an already existing one. The Commission found the measure to be compatible with the requirements of the Regional Aid Guidelines 2007-2013 (see IP/05/1653), and in particular with their rules on large investment projects. The Commission concluded that, on balance, the positive effects of the aid on regional development outweigh potential distortions of competition brought about by the aid.
“This investment project is expected to create 400 new jobs in Puertollano and will contribute to the development of the region without unduly distorting competition.” said Commission Vice President in charge of competition policy Joaquín Almunia.
Silicio Solar SAU belongs to Pillar BV, a Dutch company. Silicio is extending its existing site in Puertollano by building a second solar wafer plant. Solar wafers are used to produce solar cells out of which solar modules are made. Solar modules convert sunlight into electricity. Silicio’s full production is sold intra-group to Global Sun, a subsidiary of Pillar BV which is responsible for the commercialization of the wafers. The Pillar group does not produce solar cells or modules, only wafers.
The project is to be carried out in Puertollano, Ciudad Real, an area eligible for regional aid under Article 107(3)(a) of the EU Treaty as a region with an abnormally low standard of living and high unemployment.
The Spanish authorities already granted a €20.9 million aid for the same investment under an approved aid scheme. The second aid, also based on an existing aid scheme, had to be notified to the Commission for individual assessment and clearance, because the aid amount exceeded the individual notification threshold.
The aid package is in line with the applicable regional aid rules: in particular, the applicable regional aid ceiling for large investment projects is not exceeded, and Silicio Solar´s market shares on the world market for solar wafers are below 25% , as established in point 68 of the Regional Aid Guidelines, before and after the investment. As the photovoltaic market has a double-digit growth rate, which is fairly above the EEA growth rate, the Commission also concluded that the additional production capacity created by the project would not raise concerns. As these thresholds are not exceeded, the effect of the aid on competition is deemed to be outweighed by its positive contribution to regional development.
The non-confidential version of the decision will be made available under the case number N 285/2009 in the State Aid Register on the DG Competition website once any confidentiality issues have been resolved. New publications of state aid decisions on the internet and in the Official Journal are listed in the State Aid Weekly e-News.

Citation: Press Release of the European Commission IP/10/974

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