The European Commission has approved a €1.5bn French scheme to support biomethane production to be injected into the gas network, considering that the scheme is in line with the State aid Temporary Crisis and Transition Framework (TCTF). Under the scheme, new biomethane installations with a production above 25 GWh/year can take part to a competitive bidding process to secure 15-year long two-way "contracts for differences" (CfD) on the basis of the strike price per MWh of biomethane offered. Under the CfD model, the beneficiary will receive the difference between the strike price and the market price of natural gas; if the market price of natural gas is higher than the strike price, the beneficiary will have to pay back the difference between the two prices to the State. Selected projects must be completed and in operation within 36 months after the granting of the aid and are expected to produce a total of 1.6 TWh/year of biomethane. The aid will be granted no later than 31 December 2025.
Adopted in March 2023 and amended in November 2023 and in May 2024, the TCTF aims to accelerate the rollout of renewable energies, facilitate the decarbonisation of industrial processes, and accelerate investments in key sectors for the transition towards a net-zero economy.
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