By Decision C(2022) 1427 final of 3 March 2022 (hereinafter, the “Decision”), the European Commission approved a state aid scheme[1] aimed at promoting the shift of freight traffic from road to rail or waterways transport in the Friuli-Venezia Giulia Region (hereinafter, “FVG”)[2].
Grants will be disbursed by FVG until 31 December 2027 for a total amount of EUR 30 million to the so-called “multimodal transport operators”[3] combining a rail or waterway route as an alternative to (more polluting) road transport.
Such a measure is set in a national context where multimodal transport operators are often forced to prefer road as a cheaper and faster transport solution (but which, as mentioned, has certainly a greater impact on the environment) compared to, for example, rail transport.
This happens because, being rail (or waterway) transport more expensive than road transport, multimodal transport operators should be granted an economic advantage that “relieves” them of part of their operating costs.
The above especially for medium-to-short routes (in the case at hand, those within FVG) where no economies of scale can be achieved by multimodal transport operators as long as the fixed costs of such intermodal operations remain structurally high[4].
The rationale of the FVG measure could be outlined as follows:
In other words: FVG seems to have realized that one of the solutions to achieve as soon as possible an effective ecological transition in the transport sector within the FVG region (by significantly decreasing negative externalities due to CO2 emissions into the environment) is to actively support – through grants – multimodal transport operators that prefer an alternative transport solution to road transport.
The European Commission appreciated such approach, considering the state aid scheme in question to be fully in line with the priorities and aims of the EU policy set out in the Strategy for Sustainable and Intelligent Mobility[5] and the European Green Deal agenda[6].
Here is a brief overview of the main features of the state aid scheme proposed by FVG (and approved by the European Commission).
Aid will be granted in the form of direct grants based on the reduction of negative externalities related to freight transport[7].
The eligible costs in the framework of the FVG state aid scheme correspond to the part of the so-called “external costs”[8] which the transport of an “Intermodal Transport Unit” (hereinafter, “ITU”) of 44 tonnes by rail or short sea shipping allows to avoid compared with road transport over a distance of 91 km.
With regard to intermodal long-haul services[9], the baseline aid amount is set at EUR 50 per ITU transported.
Such baseline aid amount may be adjusted by applying a coefficient that takes into account, for example, for intermodal rail transport services[10]:
With regard, on the other hand, to short-sea shipping transport services, the coefficient will also take into account any intermediate port calls.
With regard to intermodal shuttle services within FVG, the baseline aid amount is set at EUR 50 per ITU transported (we refer, in particular, to non-exceptional transport operations).
Even in such case, the baseline aid amount may be adjusted by applying a coefficient that takes into account, for example, for shuttle services by rail, the avoided alternative road leg[11].
In its (positive) assessment of the state aid scheme in question, the European Commission therefore considered – inter alia – that the same:
In conclusion: considering the legal and development policy assessments set out in the Decision in question, a state aid scheme similar to the one authorised by the European Commission could be – in our opinion – a solution potentially applicable also in other Italian regions (obviously through the specific formal procedure for the examination of the regional aid in question – pursuant to Article 108 of the Treaty on the Functioning of the European Union – before the European Commission).
In particular, with the aid measure in question FVG is supporting both an effective modal integration of the different transport systems and the increasing shift of freight traffic from road to alternative modes (rail and waterways).
It would therefore be desirable for similar initiatives to be implemented also in the rest of Italy and – to this end – we hope that appropriate technical meetings can be set up as soon as possible (probably on a regional basis and perhaps also involving the reference stakeholders) to increase intermodality in Italy and enhance synergies with the so-called “dry ports” also through the use of special incentives already provided by national law (see, for example, the so-called Ferrobonus)[15].
We believe that the efficiency of logistics services and the boost to intermodality (also through initiatives such as the one commented on here) can be important factors also for a concrete development of local and national ports.
The development of rail transport systems would make it possible to “lighten” the pressure on the road network of ports and their territories and thus improve and make more efficient the entire logistics supply chain. This would also allow ports, in line with their Port Master Plans, to be prepared when major port infrastructure works will be ready (see, among others, Darsena Europa in Livorno and, above all, the new breakwater of Genoa).
This article is for information purposes only and is not, and cannot be intended as, a professional opinion on the topics dealt with. For any further information please contact Alberto Torrazza and Emanuele Rinaldi.
[1] The aid scheme in question is based on the following FVG regional legislation:
[2] The scheme notified by the Italian authorities represents the continuation of two previous state aid measures (SA.18169, approved on 22 March 2006 and extended twice with numbers SA.29788 on 10 June 2010 and SA.45606 on 18 July 2016; SA.50115, approved on 20 December 2018), both expired in 2021. Such notified scheme provided for appropriate adjustments to bring the new measures in line with the objectives of the European Green Deal.
[3] As mentioned/specified in paragraph (35) of the Decision, multimodal transport operator means any private and public logistic company (registered in any Member State of the European Union) providing:
In order to possibly be admitted to the State aid scheme (which in any case requires a specific admission procedure), multimodal transport operators must – inter alia – organise intermodal transport involving rail or short-sea shipping and at least one other mode of transport (road and short-sea shipping or rail respectively), as well as organise complete packages of intermodal transport services in a regime of free access by users, also taking care of the main part of the transport service.
[4] See section 2.4.1. and 2.5. of the Decision. In particular, one of the three main objectives of FVG is to further promote and support intermodal transport operations on medium to short distance connections within the regional territory (between ports, logistic hubs and heavy industry production centres) in order to decongest roads and shift heavy goods traffic to more sustainable transport modes such as rail and waterborne transport.
[5] By Communication COM(2020) 789 final of 9.12.2020, the Commission presented a set of measures that aim to set the European Union on the path to a future system of sustainable, intelligent and resilient mobility, making the main changes necessary to achieve the goals of the European Green Deal.
[6] The European Green Deal is a package of strategic initiatives aiming to set the European Union on the path towards a green transition, with the ultimate goal of achieving climate neutrality by 2050.
[7] Potential beneficiaries must submit their application (with the documentation provided for in paragraph (59) of the Decision) to the competent authorities by the end of March of the relevant year.
[8] The categories of external costs are exemplified in paragraph 1.3.1. of the “Handbook on the external costs of transport”, (version 2019 – 1.1) commissioned by the European Commission DG MOVE and developed by a consortium led by CE Delft. Specifically, external costs are those related to accidents, air and noise pollution, climate change, traffic congestion, well-to-tank (WTT) emissions, damage to natural habitat, and other external cost categories (e.g. soil and water pollution).
[9] For the sake of completeness on this point, as can be inferred from paragraphs 2.9.1. and 2.10.1. of the Decision, it should be emphasised – inter alia – that an “intermodal short-sea shipping service” is defined as a new service started from the date of publication of the amended implementing regulation referred to in footnote 7 above, on the maritime routes:
[10] Such baseline amount may be increased by up to EUR 55 per ITU transported.
[11] Such baseline amount may be increased by up to EUR 55 per ITU transported.
[12] See paragraphs (51), (53) and (55) of the Decision.
[13] See paragraph (45) of the Decision.
[14] See paragraph (96) of the Decision.
[15] By Decree No. 24 of 7 March 2022, Ferrobonus, the national incentive to support combined and transhipment transport by rail, was extended for the year 2022.
